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PEMC plays an important role in the Government's Fifty Percent Renewable Energy target by 2040
Wed, 29 Nov 2023

Philippine Electricity Market Corporation (PEMC) President Elvin Hayes E. Nidea was one of the keynote speakers for the ASEAN Clean Energy Forum held at the SMX Convention Center in Pasay City on 21 November 2023.  

The annual event was attended by luminaries and stakeholders of the energy sector hoping to get a glimpse of the power industry’s efforts and plans to lessen the carbon footprint and increase sustainable sources of energy in line with the 2020–2040 National Renewable Energy Program (NREP) of the government. 

President Nidea gave important updates on this and detailed the programs that have been implemented by PEMC under the policies and supervision of the Department of Energy (DOE) and the Energy Regulatory Commission (ERC). 

“Renewable Energy has increased based on its share in the power generation mix as of August 2023, which is at 22.44%.” Nidea said in his opening statement. “That is 2.33% higher as compared to the total share of RE in the generation mix in 2022.” He further explained. 

According to Nidea, PEMC is currently in charge of the Renewable Energy Market (REM), which is the venue for Mandated Participants to buy and sell Renewable Energy Certificates (REC) for them to comply with their annual Renewable Portfolio Standards (RPS) obligation, as set by the DOE. The REM is one (1) of the nine (9) programs envisioned to be implemented in the Renewable Energy Act (RE Act) of 2008. 

In the REM, each mandated participant receives RE Certificates based on the generation from Feed-in-Tariff eligible facilities and their contracts with RE generators, as well as the actual generation of their registered net-metering facilities and supply from Green Energy Option Program (GEOP). Through the REM, most of the programs in the RE Law will be implemented and will contribute to the gradual increase in the usage of renewable energy as mandated by the government on the power industry, both for the generators and consumers. 

PEMC, through a tripartite agreement between the DOE and the Independent Electricity Market Operator of the Philippines (IEMOP), is in the process of transferring the operation of the RE Market and its system, the Philippine Renewable Energy Market System (PREMS), to the Market Operator.  

Nidea also explained how this future set up will define the critical roles of PEMC, IEMOP, DOE, and ERC in making sure the operation of the REM is successful. “Focusing on our governance function, PEMC and the REM Governance Committee (RGC) oversee the compliance of the REM participants with their RPS obligations and improve the market rules and efficiency,” Nidea said.  

“The DOE focuses mainly on the policy making aspect such as the promulgation of policies and setting of RPS requirement. On the other hand, ERC issues guidelines and rules on RE-related programs, as well as the cost recovery mechanism for the RPS Mandated Participants and the methodology and determination of REC Price Cap,” he added.  

There also have been efforts from PEMC to promote the increase of investments in the RE sector through a partnership with the United Nations Office for Project Services (UNOPS). The Southeast Asian Energy Transition Partnership (ETP) is looking into the possibility of introducing a Voluntary RE Market (VREM) in the Philippines which could help accelerate the plans of the government of 50% renewables in the power generation mix by 2040. 

President Nidea assures the public that the PEMC, IEMOP, DOE, ERC, and Market Participants will work hand in hand to make sure operations of the RE Market will be successful leading towards a sustainable clean energy future.  

 

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WE ARE PEMC

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, the Visayas in December 2010, and in Mindanao in January 2023.

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.

PEMC remains as the governing body of the WESM primarily through the PEMC Board of Directors (PEM Board) and the WESM and Renewable Energy Market Governance Committees (WGC and RGC).

 

PEMC in the News

Daily Guardian: https://dailyguardian.com.ph/pemc-plays-important-role-in-the-governments-50-percent-renewable-energy-target-by-2040/

Tribune: https://tribune.net.ph/2023/11/pemc-bares-re-trade-rise-in-mart/

PhilStar: https://www.philstar.com/business/2023/12/03/2315949/pemc-targets-successful-rem-operations