Market price

Average spot market price drops in April amid improving supply

MANILA, Philippines – Energy prices in the Electricity Wholesale Spot Market (WESM) fell month-over-month in April due to better supply conditions as more generators came on stream. outage were able to resume operations, according to the Philippines Independent Electricity Market Operator. (IEMOP).

The average spot market price fell 10.12 percent to 6.26 pesos per kilowatt-hour (/kWh) from last month’s level, IEMOP said Friday.

The figure covers the billing period from April 1 to 25, 2022.

In a virtual briefing, IEMOP Knowledge Management Specialist Carla Rica explained that the average April supply increased by around 449 megawatts (MW) as more generators were brought back online.

Meanwhile, monthly demand decreased by 146 MW, mainly due to the influx of two typhoons, Agaton and Basyang, which brought relatively cooler temperatures to Luzon and the Visayas.

Demand fell further when people traveled to the provinces for Holy Week and businesses were closed for the holidays, she said.

During the April billing period, average supply reached a total of 13,995 MW, while demand reached 10,454 MW.

The spot market is a place where buyers and sellers trade electricity as a commodity.

To fill supply gaps, electricity distributors often purchase additional electricity from WESM at higher costs than pre-agreed supply agreements.

Distributors such as Manila Electric Co. (Meralco) consider the costs of purchasing electricity from WESM, among others, when calculating their monthly overall electricity rates.

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