ERC clarifies role in compensating must-run unit generators
The Energy Regulatory Commission (ERC) is not delayed in acting on compensation claims of power generators who were designated by the Market Operator, the Philippine Electricity Market Corporation (PEMC), to dispatch electricity as Must Run Units (MRUs) under conditions defined in the WESM (Wholesale Electricity Spot Market). This clarification comes in the wake of news reports that the “delay” of the ERC in acting on cost-recovery petitions of power plant operators or owners of power plants partly discourages or makes them hesitant to run their generation facilities.
MRUs’ compensation payments are based on the generation pricing index (GPI). The owner of the power generation plant used as an MRU can be paid additional compensation if it applies to the Market Operator and successfully shows proof that the payment based on the GPI is insufficient to cover generation costs such as: (1) cost of fuel; (2) variable operating and maintenance costs; and (3) start-up and shut-down costs.
“In the interim, the Market Operator is the one responsible for handling applications for additional compensation of MRUs. The ERC only comes into the picture when there are disputes relative to the said applications. So far, the ERC has not received any petition for dispute resolution concerning MRU compensation since the start of the operation of the WESM,” ERC Chairperson and CEO Zenaida G. Cruz-Ducut stressed. “The ERC assures the stakeholders, like the MRU power generators that it remains on top of its functions to maintain a stable regulatory environment in the electric power industry. It will remain focused on its programs and activities to help maintain a steady supply of reliable and quality electricity service,” Chairperson Ducut concluded.
February 25, 2010