A guide to the Philippines’ Wholesale Electricity Spot Market (WESM)

(from http://balitangsanrafael.files.wordpress.com)

(from http://balitangsanrafael.files.wordpress.com)

(This has been submitted by a concerned citizen about the WESM.) 

Cheaper electricity is the benefit that was supposed to result from the establishment of the Philippines’ Wholesale Electricity Spot Market (WESM).

Launched in June 2006, the WESM provided a platform that allowed the sale and purchase of electricity supplies everyday for every given hour.

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Meralco, Twitter, and brownouts

Twitter is freaking amazing.
But don’t take my word for it.
After all, I’m just quoting @nicknich3, the Twitter username of a Cagayan de Oro-based electricity price analyst and founder of an Asian energy advisory group.
@nicknich3 was prompted to make the assertion after I expressed similar sentiments about Twitter, the microblogging platform that allows users to tweet, that is, to write and publish their thoughts online in just 140 characters.

Now why would I — a person who can’t shut his trap even if you paid him to do so — sing praises for an online app that offers a mode of communication shorter than a single text message?
Simple.
Its limitation is its advantage.
Twitter users are generally forced to express their ideas clearly and briefly when formulating tweets and/or communicating with their followers (which is to Twitter what friends are to Facebook).
Besides being amused by witty tweets from users with names of people dead and alive, real and imagined, Twitter users also gain a deeper understanding of subjects and issues — trivial, arcane, or both — with the help of their fellow Twitter addicts.
Take my exchange with @nicknich3.
It began with, of all things, an unscheduled, temporary, one-hour brownout a few weeks ago in the area where I live.
When the lights went out at about one in the morning, I sent a tweet using my cellphone to my Twitter account, a process explained by clicking here.
My tweet, which came out on Twitter’s public timeline, also mentioned the Twitter username of Meralco — @meralco — the Philippines’ largest electric company and the lone electricity distributor in Metro Manila. (I mistakenly tweeted NGPC, when it should be NGCP for National Grid Corp. of the Philippines that runs the country’s power grid.)

As a result, as soon as whoever handled @meralco checked its Twitter account, s/he would see that I mentioned the company and was awaiting a reply.
Early the next day, the company replied that a tripping occurred in my area.

When I realized that @meralco was eager and earnest in replying through tweets, I peppered it with more questions, some of which were inane.
I asked @meralco about its stock price forecast, a question I knew it was unwilling to answer.
I then asked whether costs of getting electricity from bunker fuel plants were lower or higher than getting them from coal plants.*
That was when @nicknich3 came in.
From the looks of it, @nicknich3 was a follower of Meralco’s Twitter account who saw that @meralco was talking to me on Twitter.
He then replied to me.

After that, things started becoming a bit more fun and frenzied.
Immediately after following each other on Twitter, @nicknich3 and I talked about the new pricing scheme — the performance-based rating (PBR) — that Meralco was allowed to implement.
The PBR formulation allows companies to charge higher rates — sometimes even at shorter periods — so that these firms will be able to recover their investments (i.e., in research and development and in capital equipment) that may already be in danger of being obsolete and worthless.
The PBR is useful especially in industries such as telecommunications where technologies change so quickly.
Unfortunately, these quick advancements do not occur regularly in electricity distribution, Meralco’s core business, @nicknich3 said.
Which is why he also told me — again via Twitter — that he remains confused about the Energy Regulatory Commission’s (ERC) decision that allowed Meralco to use PBR when charging customers.
Shortly after that, our Twitter exchange ended.
I was unable to formulate an intelligent question nor continue the discussion, being a pseudo-professional deadline beater.
But one thing’s for sure, next time I write about the power industry, I know whom to call and where to go.
Thanks, @nicknich3, Twitter, and yes, you too @meralco.
———————
*From the That’s A Fact, Jack Dept.
Consumers incurred higher power costs from March to April because of increased generation charges. Electricity used by Metro Manila is predominantly produced by power plants that burn coal, the cheapest yet dirtiest fuel. However, some coal plants were taken offline — these needed to be fixed for maintenance — and were therefore unable to produce electricity.
To make up for the shortfall, and to avoid brownouts, distributors such as Meralco bought power from plants that use bunker fuel to produce energy. Bunker fuel comes from oil, the price of which remains expensive. High costs of bunker fuel are then passed on to consumers, prompting them to pay more for electricity consumption. This was explained by me in a text message by Dean de la Paz, a consultant of the Joint Congressional Power Commission and a blogger for GMANews.TV, the website I work for.

From The Digital Credits Dept. Digital Art from www.twitterbacksnow.com.