Luzon, Visayas grids see lower spot prices

July 21 ----- THERE was a decline in electricity spot prices in the Luzon and the Visayas grids from June to the first half of July as power demand fell due to the rainy season and Tropical Depression "Dodong," the Independent Electricity Market Operator of the Philippines (Iemop) said.

The Iemop said that despite intermittent hot weather caused by the El Niño, overall demand for electricity went down, leading to an 8.9-percent decrease in spot prices or P6.07 per kilowatt-hour (kWh) for the Luzon and the Visayas markets compared to the previous month's P6.67 per kWh. On the other hand, spot prices in Mindanao saw a slight increase of P0.49 per kWh to P3.83 per kWh compared to June's P3.34 per kWh. Iemop said that despite the slight increase, this is still 38.33 percent lower than the preceding summer month of May.

As the energy sector adapts to the cooler weather, market data for July revealed a decrease of 155 megawatts (MW) in average electricity demand for Luzon and the Visayas, dropping from 11,641 MW in June to 11,486 MW in the current month. Meanwhile, Mindanao experienced a slight increase in average demand from 1,805 MW to 1,809 MW. Despite the decrease in demand, however, a new peak demand record of 12,522 MW was set in Luzon on July 6, 2023 at 2:15 p.m., which was 3.5 percent higher than the previous year's peak recorded on May 12.

On the supply side, no significant issues were encountered, resulting in ample average supply margins for the Luzon, Visayas and Mindanao grids. Supply margins for Luzon-Visayas stood at 2,935 MW while for Mindanao they averaged 1,261 MW. The generation supply mix in Luzon and the Visayas for June 2023 was also boosted with increased contribution from the natural gas plants at 17.1 percent. Contribution from hydropower and wind energy plants also showed an increase to 4 percent and 0.7 percent, respectively. The contribution from oil-powered plants was reduced to 1.4 percent.

Reserve market trial

Iemop also provided an update on the ongoing trial operations program (TOP) for the reserve market. The Reserve Market TOP is scheduled to run for three months, ensuring the preparedness of market participants, the system operator as well as the market operator. The remaining tasks for the reserve market include the approval of the price determination methodology and necessary software certification audits. These tasks are expected to be accomplished in the coming months resulting in the anticipated commercial operations of the reserve market toward the end of this year.

The reserve market is expected to enhance the reliability and security of delivering power from generators to consumers through its mechanism for scheduling and regulating contingency and dispatchable reserves.

Source: manilatimes.net