THE Energy Regulatory Commission (ERC) directed the Philippine Electricity Market Corporation (PEMC) and the Independent Electricity Market Operator of the Philippines, Inc.

(IEMOP) to suspend the implementation of Section 8 on Billing and Settlement of the Price Determination Methodology (PDM) for the implementation of the co-optimized energy and reserve market in the Wholesale Electricity Spot Market (WESM). 

The suspension shall cover the March 2024 billing period and will be in place until the Commission finalizes its evaluation of the PDM used by IEMOP, likely in May 2024.

It may be recalled that the ERC granted an Interim Relief in August 2023 for the implementation of the then proposed PDM. The ERC highlighted then the need to assess the outcome of the then-ongoing Trial Operations Program (TOP) for the Reserve

Market, stressing the importance of the audit of the PDM, including findings and recommendations from PEMC and IEMOP for the final evaluation and eventual approval of the proposed software for running the co-optimized market. 

On January 25, 2024, the Department of Energy (DOE) issued an Advisory mandating the full implementation and commercial operation of the Reserve Market on January 26, 2024.

Subsequently, on 13 February 2024, the Commission directed PEMC and IEMOP to submit additional compliances, including the results of the software audit for the system for billing and settlement and the systems for the management of the Reserve Market.

IEMOP reported significant price increases in reserve costs for

March 2024 compared to February 2024. This significant price increase will impact the total price of electricity that will be charged to the public.