ERC acts on DOE's price determination methodology for WESM

The Energy Regulatory Commission (ERC) approved in principle the application filed by the Department of Energy (DOE) for the approval of the Price Determination Methodology (PDM) for the Philippine Wholesale Electricity Spot Market (WESM).

“The approval of the basic framework will pave the way for the DOE to commence, through the National Transmission Corporation-Market Operator (Transco-MO), the detailed implementation of the Philippine Wholesale Electricity Spot Market (WESM), including the development of the required software for the Market Management System”, ERC Chairman Rodolfo B. Albano, Jr. explained.

In the Order dated March 15, 2004, however, further development of some elements of the said methodology still needs to be addressed. The Order also specified certain elements of the PDM that will eventually be subject to future, separate and independent filing with ERC.

Final approval of the PDM will be granted by the ERC as soon as DOE resubmits the amended methodology, incorporating the amendments and explanations contained in the Order.

The PDM shall govern the overall mechanism of the Philippine WESM which is expected by DOE to be in commercial operation soon.

“The start of WESM operations will signal the start of a liberalized trading environment and healthy competition among the market players. ERC will do its best to balance the interests of consumers and the investors,” the ERC chief said.

March 17, 2004