The Philippine Electricity Market Corporation (PEMC), the governing body of the Wholesale Electricity Spot Market (WESM), emphasized the need for supply diversification to address power supply concerns, considering the country’s dependence on conventional generators for most of its energy supply.
In a presentation during the Philippine Solar PV Energy Virtual Summit, PEMC President Leonido J. Pulido III said that “the problem with too much reliance on conventional generators is the fact that in case of outages, whether planned or forced, it significantly affects our grid’s power supply.”
Pulido further emphasized that, to address the country’s reliance to conventional generators, “we have to look into other sources to augment our supply… through the increased penetration of renewable energy (RE) resources.”
RE, while considered unreliable due to its intermittency, is the cheapest source of electricity and uses locally available clean energy resources such as solar, wind, geothermal, run-of-river hydropower, biomass, impounding hydropower, and ocean energy.
With the steady increase of RE utilization in the Philippines in the last few years, Pulido stressed the need for “a collaborative effort on the part of the government and the power industry where PEMC plays a vital role.”
This collaboration involves the establishment of the Renewable Energy Market (REM) that supports the attainment of the target in the RE generation mix through a market-based policy mechanism under the RE Act of 2008 also known as the Renewable Portfolio Standards; the net metering program which institutionalizes the development of local and national capabilities in the use of RE systems; and the promotion of efficient and cost-effective commercial application of RE technologies through providing fiscal and nonfiscal incentives. Government policies issued by the Department of Energy (DOE), such as the policy on preferential dispatch for RE and the participation of battery energy storage systems and pumped-storage units in the WESM, also concretized measures to improve the power generation from variable RE resources to mainly address the problem of their intermittency.
“PEMC has signed a Partnership Agreement with the United Nations Office for Project Services (UNOPS) through the Southeast Asian Energy Transition Partnership (ETP) to usher in the implementation of an energy transition roadmap focused on introducing market mechanisms and enhancements promoting participation in the market of renewable and sustainable technologies,” said Pulido. “Institutionalizing effective strategies is imperative for us to fully harness the benefits of these RE resources, which include energy prices and supply stability to power up the Philippine economy in the new normal,” he concluded.
WE ARE PEMC
The Philippine Electricity Market Corporation (PEMC) is a non-stock, non-profit corporation incorporated in November 2003 upon the initiative of the Department of Energy (DOE) with representatives from the various sectors of the electric power industry. The PEMC served as the autonomous group market operator and governing body of the Philippine Wholesale Electricity Spot Market (WESM) for over 10 years.
The WESM is a centralized venue for buyers and sellers to trade electricity as a commodity where its prices are determined based on actual use (demand) and availability (supply). It was created pursuant to Republic Act 9136, also known as the Electric Power Industry Reform Act (EPIRA) of 2001. The WESM began commercial operations in Luzon in June 2006 and in the Visayas in December 2010.
The EPIRA mandated the formation of an independent entity to which the market operator functions, assets, and liabilities will be transferred. With this, the DOE, along with the electric power industry market participants, endorsed the transfer of the WESM operations from PEMC to the Independent Electricity Market Operator of the Philippines (IEMOP) on 26 September 2018.
The PEMC remains as the governing body of the WESM primarily through the PEM Board of Directors and the WESM Governance Committees.
PEMC’s role is to remain steadfast and proactive in its mission to ensure that there is POWER, EFFICIENCY, MARKET, and COMPETITION in the energy industry through the effective and efficient governance of the WESM.