Cooler temperatures have been significantly driving down prices in the Wholesale Electricity Spot Market (WESM).
WESM operator Independent Electricity Market Operator of the Philippines (IEMOP) primarily indicated that there was a “notable decline in electricity spot prices in the Luzon and Visayas grids from June to the first half of July due to decreased power demand during the period as a result of the rainy season and tropical depression Dodong.”
Distribution utilities, which serve in the front line of servicing consumers, have been procuring part of their supply from the spot market, hence, that level of exposure have corresponding impact in the monthly electric bills as dispatched to consumers.
The market operator further narrated the downtrend in demand – and that generally precipitated 8.9-percent drop in prices at the spot market.
IEMOP reported that the prevailing average of WESM prices this month hovers at P6.07 per kilowatt hour (kWh) for the integrated Luzon and Visayas markets, manifesting an overall downtrend from the last supply month at P6.67 per kWh.
In the case of Mindanao grid, the market operator conveyed that there was an increase of P0.49 per kWh to P3.83 per kWh from a leaner P3.34 per kWh last month.
“Despite the slight increase, this is still 38.33-percent lower than the preceding summer month of May,” the WESM operating-entity stated.
It added that “the tamer demand levels resulted in reduced imposition of the secondary price cap,” or the price ceiling which is being enforced in the spot market if there are successive spikes in resulting trading prices that would breach the prescribed thresholds.
Demand-wise, IEMOP cited the 155MW decline aggregated for both Luzon and Visayas grids to 11,486MW this month from June level at 11,486MW.
Nevertheless, IEMOP specified that it is also within this month – on July 6 in particular, that a new peak demand record of 12,522MW had been posted for Luzon grid at 2:15 pm; qualifying that such was “3.5-percent higher than the previous year’s peak.”
For Mindanao, the WESM operator emphasized that the grid “experienced a slight increase in average demand from 1,805 MW to 1,809 MW.”
In terms of generating assets’ utilization per technology, IEMOP registered increase in capacity injection of the gas plants; as well as hydro and wind power facilities; while the capacity contribution of oil plants dwindled.