Gencos to Pay 433.6 Million Pesos for WESM Operation in 2006

Excluding the Fixed Registration Fee of Php 50,000 per participant, all generators/sellers participating in the Philippine Wholesale Spot Electricity Market (WESM) will have to contribute for the payment of the Market Transaction Fees in the amount Php 433,624,276.00. The amount covers the budgetary requirements of the WESM for CY 2006. This mandate was based on the ERC Decision Case No. 2005-048RC.

The transaction Fee is to be allocated among the generators/sellers participating in the WESM. Customers in the WESM are not to be charged with the said fees. Allocation of such fee is based on the trading participants’ kWh gross metered energy transactions in the market, both for spot market transaction quantities and declared bilateral contract quantities. Allocations are to be calculated on a monthly basis using the following formula:

Rate = (Total Annual Market Transaction Fees in Php / 12) / Total Generation Metered Quantity for the Month in kWh

Rate = P/kWh

- ERC Case No. 2005-048RC

Assuming the total energy generation for the month of July 2006 is the same as the energy generation in July 2005, which is 4,771, 866 MWh. The market transaction fee would translate to Php 0.0076 per kWh. The amount is quite small and could be almost negligible. But for a generator with a net power output of 600 MW and operated as base load, their transaction fee would be Php 3.3 Million.

But in any case, the transaction fee is reasonable since the electricity market is operated as a non-stock and non-profit corporation. They cannot operate without such funding.

Other Refs:
https://www.wesm.ph/market.fees/0000/00/00/3430.pdm.compliance/
http://www.doe.gov.ph/power/Power%20Stat%202005%20update042406.htm

Category Filed in: Electricity Market, Generation Companies
Local date: July, 2009