THE Department of Energy (DoE) on Tuesday formally relinquished the chairmanship of the Philippine Electricity Market (PEM) board, paving the way for the assumption by an independent market operator (IMO) of the functions previously led by the Energy secretary over the country’s wholesale electricity spot market (WESM).
DoE Secretary Alfonso G. Cusi said his department will keep its distance to ensure that the electricity market functions independently but competitively.
“The Energy department remains the ultimate guardian of present rules and manuals and protector against industry breaches and anti-competitive behavior,” he said during the ceremony held at the office of the Philippine Electricity Market Corp. (PEMC), the WESM’s governance arm, in Ortigas Center, Pasig City.
“To do this effectively, we will continue to be attuned to the present developments while maintaining enough distance from the market’s daily functions,” he said.
Mr. Cusi earlier said that he remains firm in calling for the IMO’s establishment, which is already overdue by more than a decade from what the Electric Power Industry Reform Act of 2001 (EPIRA) originally required.
“As for the DoE, we will remain faithful to the wisdom of the EPIRA and maintain oversight of the wholesale electricity market. As we bow out from PEMC, we will remain to do our task as a policy oversight,” he said during the event.
Under the transition plan approved earlier this year, the IMO will manage the operations of the WESM while PEMC will remain the spot market’s governing body.
Mr. Cusi said the DoE’s involvement with the WESM needs to be close enough for the department to understand key developments.
He said together with the Energy Regulatory Commission, the two will protect electricity consumers against industry breaches and anti-competitive behavior.
Before the turnover, PEMC, through its PEM board — composed of representatives from the government, power generation companies, transmission utilities, and distribution utilities — conducted both the operations and governance functions of WESM.
The IMO is tasked to operate the WESM and allocate resources for that purpose. It will also set the dispatch schedule of all power facilities, and monitor daily market trading activities.
It will oversee transaction billing and settlement procedures, and maintain and publish a registry of WESM trading participants.
Noel V. Aboboto is the first chairman freely elected by the members of the PEM board. — Victor V. Saulon
