The Department of Energy announced Friday the full commercial operations of the reserve market.
All power generation companies with generating capacity or units capable of providing ancillary services (AS) may now offer and sell, even without an ancillary service procurement agreement (ASPA) with the National Grid Corp. of the Philippines (NGCP).
The reserve market, now integrated into the Wholesale Electricity Spot Market (WESM), the trading floor of electricity, aims to co-optimize energy and reserves. This may result in optimal schedules and prices for energy and reserve requirements, fostering competition and affordability while ensuring grid security and reliability.
“The full commercial operations of the reserve market today are a significant step forward for the energy sector. This will bring efficient dispatch of all available capacities by co-optimizing the capacity and price offers for energy and reserve to ensure that the required levels for both services are always met,” Energy Secretary Raphael Lotilla said in a statement.
Reserves, commonly referred to as AS, are services needed to maintain balance in the power system to ensure normal frequency and voltage levels in response to demand changes, variability of renewable energy, and possible loss of a large generating unit.
Lotilla said the full commercial operations of the reserve market would enable the NGCP, as the country’s system operator and sole buyer of reserves, to fully comply with its mandate of ensuring that sufficient levels of reserves are available at all times and can be immediately dispatched whenever needed.
The DOE, in coordination with the Energy Regulatory Commission (ERC), Philippine Electricity Spot Market Corp. (PEMC), Independent Electricity Market Operator of the Philippines (IEMOP), NGCP and other relevant stakeholders, will closely monitor the operations of the energy and reserves market. This is to ensure that the market enhances a competitive environment where transparency and accountability prevail.