The Energy Regulatory Commission (ERC) is gathering more data on the investigation it is conducting on whether or not generation companies (gencos) colluded to simultaneously conduct maintenance shutdowns to jack up prices in the Wholesale Electricity Spot Market (WESM).
“We reported last time that we issued a notice to explain on all those (power plants that went) on outage and we have already evaluated their explanations. However, their explanations to our mind are mostly allegations and are not supported by documents,” said Agnes Devanadera, ERC chair, at a senate hearing yesterday.
ERC has issued show-cause orders on June 22 to gencos to submit documents. The agency is also verifying if the companies complied with performance indices.
In the same hearing, Jay Layug, former energy undersecretary, said investigations conducted in 2013 on a similar incident ruled out a collusion.
“There is no business reason for any plant to do deliberate shutdowns as they will incur losses if they do not operate. The possibility of collusion among generators can be easily seen through the IEMOP (Independent Electricity Market Operator of the Philippines),” Layug said, adding thisis impossible especially with the current WESM rules wherein bidding for power supply occurs every five minutes.
“If operators are to collude, they would have to communicate with each other every five minutes and it does not make sense operationally. This collusion has been the subject of several investigations in the past. ERC also had one and their conclusion way back then when they investigated PSALM (Power Sector Assets and Liabilities Management Corp.) is that no collusion was done as there were computer record to prove it,” he said. – Jed Macapagal
