Reserves market starts commercial operations
THE Independent Electricity Market Operator of the Philippines Inc. (IEMOP) and the Department of Energy (DoE) commenced the full commercial operations of the energy reserve market on Friday.
The two entities said that all power generation companies with generating capacity/units that are capable of providing ancillary services (AS) may now offer and sell it even without an Ancillary Service Procurement Agreement with the National Grid Corp. of the Philippines (NGCP).
“Following the green light given by DoE and the Energy Regulatory Commission (ERC) through the issuance of DoE Advisory 2024-01-001- SEC and the ERC’s interim approval of the Price Determination Methodology for the Co-optimized Energy and Reserve Market, we announce the commencement of the full commercial operations of the reserve market at dispatch interval 0005H on January 26, 2024,” IEMOP said.
Reserves, commonly referred to as AS, are services needed to maintain balance in the power system to ensure normal frequency and voltage levels in response to demand changes, variability of renewable energy and possible loss of a large generating unit.
IEMOP said that with the full swing of commercial operations, all certified AS providers are now allowed to participate in the scheduling and dispatch process in the Wholesale Electricity Spot Market (WESM) for the provision of regulation, contingency or dispatchable ancillary services.
“Additionally, the reserve schedules and prices that will be determined through the WESM shall be binding for scheduling and dispatch, while resulting spot transactions shall be settled through the market,” IEMOP added.
The DoE said that with the reserves market being integrated into the WESM, the former can co-optimize energy and reserves, which may result in optimal schedules and prices for energy and reserve requirements.
“The full commercial operations of the reserve market is a significant step forward for the energy sector. This will bring efficient dispatch of all available capacities by co-optimizing the capacity and price offers for energy and reserve to ensure that the required levels for both services are always met,” Energy Secretary Raphael Lotilla said.
To ensure that both the WESM energy and reserves markets will maintain and enhance a competitive environment where transparency and accountability prevail, the DoE, in coordination with the ERC, Philippine Electricity Spot Market Corp., IEMOP, NGCP and other relevant stakeholders will closely monitor the operations of the energy and reserve market.