Posted by The wholesale electricity spot market (WESM) is a venue for trading electricity as a commodity. It serves as a clearing house to reflect the economic value of electricity for a particular period, as indicated by the “spot price”. This market differs from other markets because electricity cannot be stored in large quantities and it is not possible to trace which generator produced the electricity consumed by a particular customer. For such reasons, the wholesale electricity market uses the concept of a “pool” where all electricity output from generators are centrally coordinated. Generators as well as buyers of bulk electricity compete for a share of this pool, to be dispatched and scheduled to meet the electricity demand in real time
Who operates the WESM?
The Philippine Electricity Market Corporation (PEMC), the Market Operator (MO), administers WESM operations. The MO will operate the market and will ensure the optimal dispatch of generation by collecting offers from generators and bids from customers, and from which a “spot price” for electricity throughout the grid is set. It shall facilitate the settlement of financial accounts between trading participants, and continuously provide market information.
What are the key features of WESM?
1. A gross pool system for scheduling contracted and uncontracted generation and balancing supply and demand at all times;
2. A price determination process which sets the marginal value of all electricity produced and consumed by time and location at all nodes; and
3. A financial settlements process in which customers pay for electricity purchases and generators receive payments for electricity produce
What are the benefits of WESM?
1. Settlements imbalances beyond contracts.
2. Economic scheduling and dispatch of capacities.
3. Promotion of cost-effective operations through competition.
4. Transparency on power system operation.
5. Accountability of trading participants.
How does WESM works?
To know more about WESM, see the download links below:
References:
1. Wholesale Electricity Spot Market : wesm.ph
2. Energy Regulatory Commission: erc.gov.ph
3. Depart of Energy: doe.gov.ph