Despite surges, wholesale power prices still low -- PEMC
PRICES on the wholesale electricity spot market stayed low during the April 8-9 weekend despite surges in market prices at some intervals after earthquakes hit Batangas and caused outages at a number of power plants, the Philippine Electricity Market Corp. (PEMC) said.
“Notwithstanding the issuance of several yellow and red alert notices by the System Operator (National Grid Corp. of the Philippines), the secondary price cap mechanism was not imposed as breach of cumulative price threshold was not triggered,” PEMC said.
Preliminary data at the wholesale electricity spot market (WESM) showed prices remained low, said PEMC, which serves as the market’s governance arm.
It said the effective settlement spot price (ESSP) of March 2017 billing month at P3.59 per kilowatt-hour (kWh) remained the lowest compared to the March billing month of previous years. ESSP is the average price paid by wholesale customers for energy purchased from the spot market.
“PEMC monitors the movement of market prices as we ensure a market that truly espouses competition and level playing field,” said PEMC President Melinda L. Ocampo.
“WESM encourages transparency where spikes in prices provide signals on tightness of supply condition due to forced and planned outages. The secondary price cap and other measures such as lowering of price cap and setting of price floor were instituted to address sustained high prices and volatilities inherent in a competitive electricity market,” Ms. Ocampo said.
For the March billing cycle, PEMC said the spot market was the cheapest source of Meralco’s power requirements where the average price is P4.770 per kWh, or lower than the average prices set in utility’s power purchase agreements at P5.623 per kWh, and power supply agreements at P4.779 per kWh.
“Meralco’s purchases from the WESM accounts only 12.67% of the April 2017 generation charge billed to its end-users,” PEMC said. -- Victor V. Saulon