June power bills go up as spot market prices rise

Inquirer file

MANILA, Philippines — Consumers may see higher electricity bills this month after wholesale electricity prices surged during the June billing period, reflecting tighter power supply conditions across the country.

Data from the Independent Electricity Market Operator of the Philippines (IEMOP) showed that the system-wide average Wholesale Electricity Spot Market (WESM) price climbed by 22.7 percent to P9.56 per kilowatt-hour (kWh) for the June billing period from P7.79 per kWh in the previous billing period.

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WESM prices are among the components that can influence distribution utilities’ generation charges, which form the largest portion of consumers’ monthly electricity bills.

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“This was primarily driven by localized tight supply conditions and reserve deficiencies. Regional supply-demand conditions showed mixed outcomes. In Luzon, the slight decrease in demand coupled with a slight increase in supply resulted in a higher supply margin,” said Rica Cagnayo, IEMOP market analyst.

READ: Transmission rates drop in consumers’ June power bills

Demand, supply down

The increase came even as average demand eased by 1.9 percent to 15,454 megawatts (MW). Average supply, however, also slipped by 1.1 percent to 21,133 MW, narrowing the supply cushion and pushing spot market prices higher.

Among the three major grids, the Visayas recorded the biggest increase in WESM prices. Average prices surged 41.7 percent to P14.46 per kWh from P10.20 per kWh in May, as average supply fell 7.5 percent to 2,183 MW while demand dipped only 0.5 percent to 2,166 MW.

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“In Visayas, continued forced outages and increasing demand tightened supply conditions resulting in grid alert issuances and driving average market prices higher. Mindanao exhibited a similar trend to Visayas,” Cagnayo said.

READ: ERC proposes off-grid RE rules to cut power costs

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The region also experienced several yellow and red alerts during the billing period due to forced outages of power plants.

The Mindanao grid likewise saw prices climb 37.5 percent to P12.75 per kWh from P9.28 per kWh. Average supply declined 6.1 percent to 3,291 MW, while average demand slipped 2.5 percent to 2,153 MW.

In Luzon, the average WESM price rose 13.3 percent to P7.95 per kWh from P7.02 per kWh. Average supply increased by 1 percent to 15,659 MW, while demand eased by 2.1 percent to 11,135 MW.

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IEMOP’s data showed the country’s peak demand during the billing period reached 19,842 MW on May 28 at 2:25 p.m., just 2 MW below the all-time system peak, while available supply reached 23,449 MW. /cb