Marcos: ERC suspends WESM operations on red alerts

MANILA, Philippines: President Ferdinand Marcos Jr. on Wednesday said the Energy Regulatory Commission (ERC) temporarily suspended the operation of the Wholesale Electricity Spot Market (WESM) during red alerts to mitigate the anticipated increase in electricity prices.

In his speech during a Labor Day event in Malacañang, Marcos said the ERC declared the suspension of WESM operations based on notices issued by the system operator National Grid Corporation of the Philippines (NGCP).

«Due to extreme heat, power consumption rose which would result in an increase in price. Yesterday, the Energy Regulatory Commission moved to temporarily suspend the operations of what we call the Wholesale Electricity Spot Market every time a red alert is declared by the System Operator or NGCP,» he said.

«This is intended to prevent a hike in electric bills amid the calamity caused by El Niño,» the President added.

The WESM, created by virtue of Section 30 of Republic Act 9136, otherwise known as the Electric Power Industry Reform Act of 2001, is a venue for trading electricity as a commodity.

It is where the power generators sell their excess capacities not covered by contracts and where the customers buy additional capacities on top of their contracts.

This developed as the NGCP placed the Luzon grid on yellow alert for the third consecutive day this week due to lack of available reserves.

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A yellow alert is issued when the operating margin is insufficient to meet the transmission grid's contingency requirement.

The Department of Energy (DoE) said that the unexpected power outages in over 32 power plants in April 2024 set a record.

A total of 1,811 megawatts (MW) of power were lost, which is more than double the average of 700 MW of power lost from 2019 to 2023.

Last Monday, the President assured the public that the government would carry out plans and strategies to tame power prices amid the current high demand for electricity.

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«We're continuing to monitor the price and we're continuing to encourage and to endorse all of the programs of NGCP so that they will increase the coverage of their transmission lines all over the country,» Marcos said during a