MANILA – Trial operations have begun for the integration of the Mindanao grid in the wholesale electricity market, with participants, led by the National Grid Corporation of the Philippines (NGCP) as the System Operator, holding end-to-end testing of all interfaces and systems.
The trial operations run commenced on Monday (June 26) and also involved generation companies, distribution utilities, and grid-connected customers. The runs involve simulations of all processes such as registration, bid submission, pricing and scheduling, and settlement, according to the Philippine Electricity Market Corp. (PEMC).
The trial operations program signals the start of implementing test cases of a market-based mechanism for the efficient scheduling, dispatch and settlement of energy withdrawal and injections in the Mindanao grid, brought about by excess generation supply starting in 2016 with the entry of 748 MW of new generation capacity. Such capacity is expected to increase further by 1,260 MW until 2018.
A total of 41 Mindanao participants have participated in the trial operations program as of Wednesday, said PEMC. The trial operations run is expected to last for three months. The successful trial operations is a criterion for the commercial operations of WESM Mindanao.
“PEMC as the designated Market Operator is committed in ensuring the readiness of the personnel and interfaces of our Mindanao participants to ensure a functional electricity market working in raising the competition and transparency in the power industry,” said PEMC President Melinda L. Ocampo.
According to PEMC, several capacity-building activities are also in the offing parallel to the trial operations program to ensure the readiness of participants prior to the commercial operations of the integration of Mindanao in the WESM.
The integration of Mindanao into the WESM will cover, among others, the following:
1) application of the ERC-approved Price Determination Methodology (PDM) for pricing and settlement of electricity transactions in the Mindanao grid,
2) utilization of the Market Management System (MMS) for the determination of dispatch schedules in the Mindanao grid,
3) provision of access to Mindanao generators and customers to the MMS for the submission of bids, offers, and self-schedules, and other trading functions,
4) real-time publication of wholesale prices for electricity in the Mindanao grid in the public website, and
5) eligibility of Mindanao stakeholders for membership in the Philippine Electricity Market Board and its various committees.
Coinciding with the onset of the Mindanao trial operations program is the initiation of the live parallel operations of the new market management system (NMMS) in the Luzon and Visayas grids. The live parallel operations is a milestone in the implementation of the enhanced WESM design via the new market management system (NMMS) enabling the Market Operator, the System Operator, Trading participants and other Service Providers to operate under a live market environment of the NMMS in parallel with the existing market management system until the transition to commercial operations or “Go Live” of the NMMS. The results of the NMMS will not be used in the billing and settlements processes of actual transactions, hence, will not be financially binding.
PEMC President Ocampo explained that the live parallel operation is a transition phase that comes after the trial operations stage that started last March 26, and prior to the Go Live. During this period, the NMMS is subjected to actual inputs, with the goal of (1) evaluating the resulting prices and schedules, and (2) assessing the NMMS’ performance in a real-time environment. It shall also gauge the readiness of the interfaces of the Trading Participants and the System Operator in this real-time environment.
