PEMC to be replaced with new firm under IMO regime of WESM
By early part of next year, the Philippine Electricity Market Corporation (PEMC) may already be a “thing of the past”, with the government’s proposal to have it replaced by a new company, as the Wholesale Electricity Spot Market (WESM) will already be placed under the tutelage of an independent market operator (IMO), a prescription under the Electric Power Industry Reform Act.
Energy Secretary Alfonso G. Cusi , in a briefing with reporters, has noted that the WESM will be managed by a new company and that it shall be placed under IMO by February next year.
“WESM will be under an independent entity, a new corporation that will no longer be PEMC,” he said. The President of that company, he qualified, shall already be chosen by and among the members of the IMO Board.
Cusi emphasized that the government’s grip over the power spot market would soon be over, as far as direct management of the WESM is concerned.
Nevertheless, he qualified that the Department of Energy (DOE) shall still exercise “supervision rights” over the power spot market, as anchored on the government’s duty to prevent abuses and protect consumers’ welfare.
“The new company will be independent and separate from PEMC. It shall be independent from government as provided under the law…you have to give them some independence. We don’t have ambition to hold on to it forever,” Cusi said.
PEMC was incorporated to man the power spot market while it transitions from the government’s charge on to full private operations. WESM was commercially launched June 2006, almost a decade delayed now into its envisioned IMO phase.
On the Philippine Stock Exchange’s (PSE) posturing to take over the WESM, Cusi noted that it could be “worth studying if it’s for the good of the consumers” primarily on the operations of a “futures market”. However, this proposition has been generating apprehensions more than acceptance from the industry players on perception that the stock market generally lacks knowledge in managing technically-laden physical assets, like power plants as well as congestion concerns in the transmission system.