Spot electricity 7% costlier in Dec
After softening in the previous month, local spot electricity prices increased by almost 7 percent in the early part of December as a string of power plant outages and capacity reduction threatened electricity supply in Luzon.
Wholesale Electricity Spot Market (WESM) prices averaged P9.12 per kilowatt-hour (kWh) as of Dec. 11 from P8.53 per kWh recorded in the November billing period, based on data from the Independent Electricity Market Operator of the Philippines (Iemop).
“We will still have to determine the final price at the end of the billing period and we will know that by January of next year,” said Iemop corporate communications manager Josell Co in a virtual briefing.
Co noted that red and yellow alerts in the Luzon grid and the Visayas grid had been raised in the latter part of November through the first few days of December.
Grid operator National Grid Corp. of the Philippines (NGCP) raised yellow and red alert notices as many power facilities were on forced outage or slashed their generating capacity at that time.
Red alert is a warning of supply deficiency that can result in power interruptions while yellow alert is raised in the event of thin power reserves.
“Hopefully, [there’s] no untoward … forced outages again that [may] result in tightening of supply in the market. That’s one of the major issues [affecting the supply],” said Iemop head of corporate strategy and communications Isidro Cacho Jr.
On the impact of the suspension of the supply deal between conglomerate San Miguel Corp. and distribution utility Manila Electric Co. (Meralco) on WESM prices, Cacho said this would depend on Meralco’s blended rate for the January billing period.
Iemop noted that supply reached 12,534 megawatts (MW) as of Dec. 13, lower than last month’s 13,691 MW, yet demand rose to 10,499 MW from 10,355 MW. This translated to a margin of 2,085 MW.
“Overall, the electricity demand for 2022 saw a normalcy in terms of its growth as compared with its previous levels in 2020 and 2021 where the effects of the pandemic are extremely felt,” said the energy bourse operator in a statement.
“On average, it has grown by 3.6 percent versus the 2019 levels. In terms of peak demand values, the demand has grown by 8 percent from the recorded peak demand in 2019,” it added.
Co said they had observed a return to normalcy in terms of power demand for 2022 and demand is expected to grow come 2023.
Soaring prices of imported fuel amid Russia’s invasion of Ukraine have also affected spot electricity pricing.