FIVE distribution utilities have yet to register to the Wholesale Electricity Spot Market (WESM), with barely a month left before its target implementation on January 26, 2020.
In the information provided by the Department of Energy in Mindanao (DOE-Mindanao), 82 out of the expected 87 private distribution utilities (DUs) and cooperatives have started their registration in the WESM.
These include those who have already completed the process and those which are still working on it.
With this, the market operators of WESM, the Independent Electricity Market Operator in the Philippines (IEMOP), will return to Mindanao to initiate another round of registration of the trading participants.
“We are still finalizing the dates but we are looking at January and February to go back to Mindanao for registration,” IEMOP corporate communications manager head Eric Nino U. Louis said in a text message with SunStar Davao.
He said they have already given the DUs and cooperatives the temporary access to its Central Registration and Settlement System (CRSS) for the mandatory registration.
Among the requirements that the trading participants must comply with the market operator to be registered is the prudential requirement or the “security deposit”.
According to the WESM Rules, “the purpose of the prudential requirements is to ensure the effective operation of the spot market by providing a level of comfort that WESM members will meet their obligations to make payments as required under the WESM Rules”.
The amount will be calculated by IEMOP based on the “projected gross ex-post energy settlement quantities” that must be determined by the DUs and energy companies (ECs).
“[The trading participants are] just trying to complete them [requirements] actually. [They are] Also awaiting information from us on their prudential computation,” Louis said.
He also encouraged all the utilities in Mindanao to comply with the requirements before January 2020.
“Readiness of the participants should be considered before we operate the market in January,” he said.
The Energy Regulatory Commission (ERC) has earlier noted “the low turnout of participants in the trial operations program (TOP)” for WESM Mindanao in their WESM Mindanao Readiness Assessment (WMRA) last month.
The report added that there is “the incidence of manual load dropping (MLD) despite an oversupply of generating capacity in the region resulting from the DUs’ non-compliance to the IMDP (Interim Mindanao Dispatch Protocol).”
Based on its November 2018 advisory, the Department of Energy (DOE) said it will also impose “applicable penalties and sanctions in accordance with existing policies promulgated and may be adopted by DOE and/or ERC in pursuance of the WESM objectives” for those who will refuse to register in the market.