Meralco cites opening of spot electricity market
Thursday, June 22, 2006
The Manila Electric Company (Meralco) recently lauded the forthcoming opening of the Wholesale Electricity Spot Market (WESM) saying this would hasten the advent of a "truly competitive environment in the power industry.’’
Meralco marketing head Miguel Lopez said the start of WESM operation this week, although partial in scope, "provides a preview of the possible developments in the power sector that would ultimately benefit our consumers.’’
Lopez said Meralco’s support for WESM is part "of the company’s bigger support for a true open access regime in the electric power industry.’’ He said this was fully expressed when Meralco agreed to a partial open access despite the delay in the privatization of the generation assets of the National Power Corporation (Napocor).
It will be recalled that the Electric Power Industry Reform Act (EPIRA) mandated that at least 70 percent of Napocor assets should have been turned over to the private sector before the open access regime could commence.
Meralco, however, early this year unilaterally offered to the government to allow open access for its customers with a monthly consumption of one megawatt or more.
According to Lopez, WESM spurs a "reasonable optimism that the price of electricity would remain affordable.’’ This is because WESM provides the mechanism for power generating plants to compete with each other. This, in turn, would create an environment where the price of the commodity is influenced more by free market choices rather than by regulation.
Lopez said the partial WESM operation "would widen Meralco’s options for sourcing more reasonably priced power for the consumers in our franchise area.’’
As a distribution firm, we are always looking for ways to bring cheaper power to our residential and industrial customers, he added.
Earlier, various business organizations lauded Meralco’s move to allow partial open access for its large industrial customers.
The Philippine Chamber of Commerce and Industry and the Philippine Exporters Confederation welcomed Meralco’s move, citing the positive effects it would bring to the manufacturing sector.
posted by philpower @ 10:05 PM,
