WESM commercial operations in Mindanao deferred anew

MANILA, Philippines — Commercial operations of the wholesale electricity spot market (WESM) in Mindanao have been pushed back to coincide with the completion of the Mindanao-Visayas Interconnection Project (MVIP) within the first quarter, according to industry officials.

The Independent Electricity Market Operator of the Philippines (IEMOP) is looking to launch WESM Mindanao once the MVIP starts commercial operations, IEMOP corporate communications manager and spokesperson Andrea Caguete said in a briefing last Friday.

“We’re ready on our part, were continuing our registration. But what we’re looking at, as told by the Department of Energy (DOE) is WESM Mindanao will start commercial operations when the MVIP is completed,” she said.

Caguete said the National Grid Corp. of the Philippines (NGCP) has committed to finish the MVIP within this quarter.

“Their commitment is the MVIP will be completed by March,” she said.

Sought for comment, DOE assistant secretary Redentor Delola said the agency is working on that target to start  WESM Mindanao operations.

“We are working on that (but) we (still) have to evaluate,” he said in a text message.

The DOE earlier published a draft circular proposing to declare the commercial operation of the WESM in Mindanao on Dec. 26, 2021.

This follows the agreement reached on Oct. 8 that the pending registration concerns shall no longer impede the commercial operations of WESM Mindanao.

WESM Mindanao commenced operations last June 25 but only central scheduling of capacities were allowed to be implemented to give time for participants to complete full registration in the WESM.

But after a month, the DOE decided to extend the implementation of the WESM central scheduling until further notice since there were still participants that had yet to register.

As of Oct. 24,  only 39 out of the expected 96 participants in Mindanao had registered in the WESM.

Meanwhile, the MVIP, certified as an Energy Project of National Significance in 2018, was initially targeted for completion by December 2020 but was deferred to December 2021 due to the impact of the COVID-19 pandemic and subsequent quarantine restrictions across the country.

In February last year, the NGCP said the project could not be completed on the adjusted December 2021 target due to the damage of several portions of its fiber optic cable connection.

The project covers 184 circuit kilometers (ckm) of submarine cables and 526 ckm of overhead wires connecting Dapitan, Zamboanga del Norte to Santander, Cebu.

Once completed, the MVIP will connect the Visayas and Mindanao grids through a high-voltage direct current (HVDC) system with a 450-megawatt (MW) initial capacity, realizing a one Philippine grid.

The interconnection of Visayas and Mindanao was first proposed by government in 1984, but it was private entity NGCP which brought the government’s decades old plan from the feasibility stage to the implementation and completion stage.

The MVIP, provisionally approved by the Energy Regulatory Commission (ERC) in 2017, is considered the biggest power infrastructure project in the history of the country with an estimated project cost of P52 billion.

NGCP is a Filipino-led, privately owned company in charge of operating, maintaining, and developing the country’s electricity transmission grid, led by majority shareholders, vice chairman Henry Sy Jr. and co-vice chairman Robert Coyiuto Jr.