ERC seeks independent body to audit PEMC

MANILA, Philippines - An overall audit will be conducted on the electricity spot market as a precursor toward a transition to an independent market operator (IMO), the Energy Regulatory Commission (ERC) said.

The power regulator is looking for interested parties to conduct the independent audit on the Philippine Electricity Market Corp., which operates the Wholesale Electricity Spot Market or (WESM), chairman Jose Vicente Salazar said.

“Our bids and awards committee already published the request for expression of interest and the process is now ongoing for the procurement of an auditing firm which will now conduct the audit on PEMC,” he said.

PEMC, which has been operating the market since 2006, is a 15-man body led by the Energy Secretary and composed of representatives from each sector of the electric power industry as well as independent members.

But according to the Electric Power Industry Reform Act of 2001, the WESM must be transferred to an independent entity or IMO one year after its establishment.

Salazar said the audit will help start initiatives for the electricity spot market.

“Definitely the audit is just the first step in determining the additional initiatives that we have to undertake with respect to the regulation of the market. If we determine if we should undertake additional initiatives to make us more effective in regulation, then we will have to do that,” he said.

During the Senate public hearings held in October, Senator Sergio Osmeña III has called on the ERC to conduct an independent audit on PEMC because it is not subject to audits by the Commission on Audit as is a private entity.

SGV & Co. has been engaged by PEMC as external auditor since its establishment.

Salazar noted its independent audit will be done side by side with that of SGV “to address concerns of certain sectors.”