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Sunday, January 21, 2018

DOE: No Power Disruption Despite ERC Constraints


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The Department of Energy (DOE) and the Wholesale Electricity Spot Market (WESM) agreed to allow power generation companies with expired Certificates of Compliance (COCs) or with pending COC applications with the Energy Regulatory Commission (ERC) to operate and trade in the WESM.

The decision is in line with Energy Secretary Alfonso Cusi's assurance that he will not allow any disruption in the country’s power supply as a result of the delay in the processing of applications before ERC, including COC applications, due to the suspension of its four Commissioners.

"The move aims to protect electricity consumers by preventing disruptions in WESM transactions while the ERC issue is being sorted out,” Cusi said after approving the resolution on the agreement with the Board of Directors of the Philippine Electricity Market Corporation (PEMC), the operator of the WESM, last Thursday.

"The paramount consideration is the overall protection of public interest and the security of the supply of power. This is needed for the Philippines to meet its economic targets. This should take precedence over administrative issuances especially when an administrative body is unable to act," Cusi emphasized.

Cusi also directed PEMC and the DOE to work closely with the ERC to ensure the continuing operations of existing plants and to allow power generation from new plants that will be completed. 

Under the DOE-PEMC resolution, power generation companies with expired COCs can continue trading upon proof of submission of their application for the renewal of their COC with ERC. 

"New plants will also be permitted to trade or submit offers to the WESM upon proof of completion of testing and commissioning and other requirements for the issuance of a COC."

Cusi explained, "The COC is a requirement for the registration and continuing participation of generation companies in the WESM. About 26 generation companies with a total of 3,314.60 MW generator capacities have expired or have expiring COCs in 2018."

"Additional new capacities of at least 720 MWs are also expected to go on commercial operations within the next few months. If not allowed to participate in the WESM, the available electricity supply in the market will be curtailed, which can result in higher market clearing prices," the Energy Chief explained.

"As the summer months draw near, the use of electricity is anticipated to increase. The DOE is monitoring the situation to ensure the sufficiency of supply to meet the rising demand," Cusi concluded.

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