Electricity spot market prices down in early November

Electricity spot market prices averaged P8.08 per kilowatt-hour (kWh) as of Nov. 13, according to the initial reading of the Independent Electricity Market Operator of the Philippines (Iemop).

This was lower than the P9.22 per kWh recorded in the October billing and P9.12 per kWh in September, breaking the upward trend seen in market prices over the last few months.

Iemop attributed the decline in the Wholesale Electricity Spot Market (WESM) prices to an “upward trend” in supply and lower demand, resulting in a greater margin and lower average prices.

During the comparative period, supply levels recorded at the power bourse reached 13,651 megawatts (MW), an increase of 1.3 percent from a month ago while demand dropped by 6.7 percent to 10,083 MW. This resulted in a margin of 3,568 MW.

Referring to the October data, Iemop noted coal-fired power plants continue to dominate the generation mix, comprising 58.6 percent of the total. Natural gas plants and geothermal facilities came next with 16.6 percent and 9.9 percent, respectively.

The share of natural gas, geothermal and hydro plants in the energy mix declined last month while those of hydropower, biomass and oil-based plants registered a meager increase. Likewise, the percentage share of wind, solar and battery storage facilities was almost the same.

Energy efficiency

WESM is the centralized venue for trading electricity as a commodity where generators can sell their excess capacities not covered by supply contracts and distributors purchase additional capacities to supplement their primary supply. It is run by Iemop.

Meanwhile, Iemop continues its push for the efficient use of energy. Based on its simulations, the efficient usage of energy results in a 3-percent decrease in demand, especially in the summer months when consumption is usually high.

If applied, electricity demand would largely decrease by 346 MW.

Iemop also said WESM prices would significantly drop by 5.8 percent to average at P7.60 per kWh and mitigate the issuance of red and yellow alerts in the power grid.

A yellow alert is issued when power reserves fall below the ideal levels while a red alert is declared due to insufficient electricity, which might result in rotating power interruptions.

Christian Karla Rica, assistant manager of Iemop’s Knowledge Management Services, said the excessive use of electricity places a large burden on the environment and the pockets of consumers.