| About WESM |
About WESM
WESM is the Wholesale Electricity Spot Market. It is a venue where electricity made by power-producing companies are centrally coordinated and traded like any other commodity in a market of goods in a level playing field and prices are driven by the law of supply and demand to buyers with the objective of giving the best price for consumers of electricity including the ultimate end-user.
As a wholesale market, it is open to distributors, directly connected customers, large users, and eventually, supply aggregators. As a spot market, electricity is traded on a real time basis or on the “spot”.
The WESM's role in the country's overall energy reform is to create a fair, transparent and reliable trading environment that will attract investments and encourage healthy competition leading to the ultimate objective of cheaper electricity for all consumers. The WESM specifically aims to:
The WESM was established after Republic Act 9136, or the Electric Power Industry Reform Act of 2001 (EPIRA) was signed into law on June 8, 2001.
The main objective of EPIRA is to have a power industry that would reflect the true cost of electricity, where stakeholders are empowered to make choices in regard to critical market decisions, and where there will be a marked improvement in the delivery of power supply to end-users due to greater competition and higher levels of efficiency through the creation of a competitive electric power market or the Wholesale Electricity Spot Market (WESM).
On 26 June 2006, the WESM commenced commercial operations in Luzon for the trading of energy, upon declaration by the Department of Energy (DOE) through DOE Circular No. 2006-06-008.
WESM Regulation
Both the DOE and the Energy Regulatory Commission (ERC) perform regulatory oversight functions over the WESM.
As a wholesale market, it is open to distributors, directly connected customers, large users, and eventually, supply aggregators. As a spot market, electricity is traded on a real time basis or on the “spot”.
The WESM's role in the country's overall energy reform is to create a fair, transparent and reliable trading environment that will attract investments and encourage healthy competition leading to the ultimate objective of cheaper electricity for all consumers. The WESM specifically aims to:
- Provide incentives for the cost-efficient dispatch of power through an economic merit while guaranteeing the security and reliability of the power system.
- Create reliable price signals to assist participants in weighing investment options.
- Provide and maintain a fair and level playing field for suppliers and buyers of electricity.
The WESM was established after Republic Act 9136, or the Electric Power Industry Reform Act of 2001 (EPIRA) was signed into law on June 8, 2001.
The main objective of EPIRA is to have a power industry that would reflect the true cost of electricity, where stakeholders are empowered to make choices in regard to critical market decisions, and where there will be a marked improvement in the delivery of power supply to end-users due to greater competition and higher levels of efficiency through the creation of a competitive electric power market or the Wholesale Electricity Spot Market (WESM).
On 26 June 2006, the WESM commenced commercial operations in Luzon for the trading of energy, upon declaration by the Department of Energy (DOE) through DOE Circular No. 2006-06-008.
WESM Regulation
Both the DOE and the Energy Regulatory Commission (ERC) perform regulatory oversight functions over the WESM.