During its media briefing, the Independent Electricity Market Operator of the Philippines (IEMOP) discussed the highlights of the Philippine Wholesale Electricity Spot Market (WESM) operations for the preliminary October 2024 billing period.
The Luzon, Visayas, and Mindanao regions recorded average demand increases from 9,746 MW, 1,955 MW, and 1,999 MW in September to 9,915 MW, 2,003 MW, and 2,054 MW in October 2024, respectively. Regarding demand levels, Luzon recorded a peak of 12,551 MW on 26 September 2024 at 14:25H, Visayas peaked at 2,549 MW on 30 September 2024 at 14:35H, and Mindanao reached a peak of 2,609 MW on 11 October 2024 at 14:05H.
In Luzon, prices increased from ₱3.80/kWh in September to ₱3.89/kWh in October. Similarly, prices in Visayas and Mindanao rose from ₱4.56 and ₱3.48/kWh to ₱5.93 and ₱5.20/kWh, respectively. System-wide, the average price in the WESM for the October 2024 billing period was ₱4.39/kWh, compared to ₱3.88/kWh in the previous billing month. The spot prices used in settlement also increased from ₱4.12 to ₱4.72/kWh between the September and October billing periods. This increase is attributed to a minimal rise in system demand, driven by activities for the upcoming Christmas season.
For the reserve market, the regional reserve capacity mix highlighted the dominance of hydro-based technologies in Luzon and Mindanao, while Visayas is primarily powered by oil-based technologies. This capacity mix influenced the regional prices, with higher costs for regulation, contingency, and dispatchable reserves in Visayas.
With the resumption of commercial operation of the reserve market on 05 August 2024, the reserve requirements set by the Grid Code were met, with the exception of Visayas for certain trading dates due to deficit in regulation reserves. Prior to this, available capacity often fell short of the required levels, which necessitated the scheduling of uncontracted capacity or capacity not covered by the Ancillary Services Procurement Agreement (ASPA) to ensure the grid’s reliability, security, and stability.
Notably maintaining grid reliability comes with associated costs, which are reflected in the zonal prices for each reserve type and region. High zonal prices typically indicate reserve shortages and the use of more expensive power plants, such as oil-based technologies, to meet reserve market needs.
Lower WESM average price is expected with a stable supply and improved demand situation as the colder months approach. IEMOP will continue to closely monitor supply, demand, and prices in the coming months.
