Electricity spot market not driving prices down – RDC 7

Posted on October 31, 2012

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THE Regional Development Council in Central Visayas scored the Wholesale Electricity Spot Market for driving power prices up instead of reducing it.

RDC execom members met last Tuesday morning at the Rizal Library for a briefing on the Wholesale Electricity Spot Market (WESM) operations from Chrysanthus Heruela, a board officer of the Philippine Electric Market Corp.

Mayor Michael Rama who is also RDC 7 chairman told reporters after the meeting that execom members were dissatisfied especially with WESM’s computation of their power charges, He said this is contrary to the WESM’s mandate which is supposedly to bring down power prices.

“We are not much convinced that they are performing according to what they were told at the outset,” he said.

Rama said they also noticed a very glaring “white lie” in WSEM’s presentation. He said that while WESM was supposed to operate to make power affordable, they are instead selling at a high cost.

The executive committee of the Regional Development Council in Central Visayas is calling a meeting with power stakeholders to understand the local power situation and possibly come up with recommendations on how to properly fix if not reduce power prices, said Rama.

Rama said execom members also wanted to take advantage of the appointment of former Leyte governor Jerico Petilla, a fellow Visayan, as new energy secretary in their hopes of lowering power prices in the Visayas. Petilla used to head RDC 8.

“Hopefully, makatabang ta on the issue on the pricing of power,” said Rama.

Bohol Gov. Edgar Chatto earlier called the RDC 7 executive committee’s attention on the threat of some resort owners in his province to already cease their operations because of high power cost.

He asked the Energy Regulatory Commission to intervene and “correct” power prices.

Rama said complaints on high power costs are often brought to the attention of mayors and governors who are helpless in address these problems.

But he said the RDC as a whole can come up with recommendations on how they want the matter addressed.

Rama said Petilla’s appointment as energy secretary is timely with RDC 7’s efforts to seek interventions on high power costs in the Visayas.

“We will be presenting our suggestions and recommendations to the newly installed energy secretary,” he said.

But before they do this, Rama said, he will again be calling another execom meeting before the year ends where they will sit down with local power players which include the electric cooperatives and Veco among others to discuss the local power situation.

Rama said the execom also wanted to explore the possibility of tapping waste to energy programs as potential local power source.

The WESM was created by the Energy and Power Industry Reform Act (RA 9136).

It is supposed to provide a competitive mechanism in determining the price of electricity in the spot market not covered by bilateral contracts between power producers and consumers.

The Philippines has the highest electricity rates in Asia. /Doris C. Bongcac, Chief of Reporters

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