Enhancing the Spot Market to Attract Investments to Renewables
The Wholesale Electricity Spot Market (WESM) is the Philippines’ central venue for electricity-trading. Renewables enjoy a position of priority within the market for dispatch. However, the potential for maximized revenues are limited by outdated price caps, which were set around 7 years ago, and do not reflect present economic conditions. The existing low price caps discourage investments in peaking generators, such as solar and wind, leading to heavy reliance on ageing fossil-based plants. This also limits potential revenues and discourages investments, particularly in renewables which tend to have low operating costs but higher capital costs. Investors will be hesitant to commit to capital projects that may not be able to generate sufficient revenues.
This project will address barriers in the current market, but assessing and updating the methodologies for setting price-mitigating measures and recommend new cap values. Additionally, the project will analyze opportunities in the spot market and risks to renewable energy investments.
Implementing Partners
Intelligent Energy Systems (IES)
In partnership with
Philippine Electricity Market Corporation (PEMC)
Strategic Outcome
Derisking Investments to Renewable Energy
