Adequate power supply a must prior to start of Visayas spot market

The Department of Energy (DOE) wants assurance of enough supply of power in the Visayas before proceeding with the establishment of a wholesale electricity spot market (WESM) in the area.

Energy Undersecretary Melinda Ocampo told reporters that the Philippine Electricity Market Corp. (PEMC), the operator of the WESM, is currently conducting trial operations of the WESM Visayas.

“The DOE cannot give the go-signal for the WESM Visayas unless we are assured by PEMC that there is sufficient supply of power in the area,” she said.

Ocampo said they need to be assured that there would be additional power generating plants to be built in the Visayas.

“We want assurance that there would be more loads that would come into the Visayas system,” she said.

The DOE official said that if there would be no additional power capacity in the Visayas, the setting up of the WESM Visayas will just create pressure on power rates.

But Ocampo said the WESM Visayas will definitely be put in place by this year although she declined to say if it will be on Jan. 26 as proposed by the PEMC.

PEMC president Lasse Holopainen, on the other hand, assured that the power supply situation in the Visayas will not pose a problem to the operation of the WESM.

“The Visayas has had supply issues since 2002 and mainly these are during certain times of the year and certain times of the day. It forces the use of a lot of oil. You can look at the market as possibly being able to discipline the use of that and to price it properly in order to have new generating capacity to come in,” Holopainen said.

The generation mix in the Visayas area is predominantly geothermal at 81 percent. The remaining sources are diesel, 10 percent; nine percent coal and a minimal percentage of hydro.

By islands, Cebu has the highest average demand of 329 megawatts (mw) followed by Negros, 136 mw, Leyte/Samar, 130 mw, Panay, 74 mw and Bohol, 28 mw for a total average demand of 697 mw.

The PEMC official said one of the concerns in establishing the WESM Visayas is the physical challenge such as metering and reliability of the energy management system data.

PEMC has been conducting trial operations for the WESM in the Visayas, including its integration into the WESM in Luzon since 2005.

In Luzon, PEMC started the WESM, the first of its kind in the Philippines, in June 2006.