MANILA, Philippines - The full commercial launch of the Interim Mindanao Electricity Market (IMEM) needs the approval of an offer cap by the infrastructure’s proponents, the Department of Energy (DOE) said in a circular.
The IMEM is a trading floor for electricity in Mindanao, similar to the Wholesale Electricity Spot Market (WESM) to be operated by the Philippine Electricity Market Corp. (PEMC), which is also the operator of the WESM.
In the circular, Energy Secretary Carlos Jericho Petilla said the full commercial operations of the IMEM is set on Nov.26 following the commencement of the initial launch on Sept. 26.
However, the full commercial operations would first need the approval of the offer cap by the Department of Energy, PEMC and the Energy Regulatory Commission (ERC), the power regulator.
According to the DOE, the offer cap – which will influence the rates of electricity to be traded in the market – should not be greater than any limit that may be agreed upon by the DOE, the ERC, and the IMEM operator, which is the PEMC.
Based on the proposed computation for the offer cap, the generation cost would be the basis of the offer cap.
“In computing for the generation cost that will be the basis of the IMEM offer cap, it is integral that the facility that will be used as the benchmark is correctly identified. The selection of the benchmark facility should take into consideration the ability of the resulting offer cap to compensate all generating facilities that would be needed to serve all IMEM demand,†the DOE said.
“Given this consideration, the proposed benchmark facility for setting the IMEM offer cap is a new one-megawatt diesel engine generator set that an embedded IMEM Load Curtailment Resource may acquire to participate in the IMEM and provide additional energy that existing generation capacities may not provide,†the Energy department also said.
The IMEM will be a day-ahead market, and is expected to pool an estimated 200 MW from all available capacities, including all generation capacities from embedded generators and voluntary load curtailment resources in the Mindanao grid. During the first week of the initial commercial operations of IMEM last week, PEMC would collect the data from submissions of all the IMEM mandatory participants of their respective membership forms and participation agreements.