The Market Monitor Minding the Nation's Business
By Jesse C. Ong
The Independent Electricity Market Operator of the Philippines, Inc. (IEMOP) is seeking a thorough review by the Department of Energy (DOE) of the Wholesale Electricity Spot Market (WESM) operations and management policies to end all speculations of graft and mismanagement by its detractors.
IEMOP President & CEO Atty. Richard J. Nethercott yesterday said that it is high time for the DOE to revisit DOE Circular No. DC2018-01-0002 and reassess the viability of maintaining the two-entity set-up of the WESM operations and governance.
“We are not unmindful, however, of unfounded criticisms that have effectively demoralized our officials and personnel. This is why, I am strongly suggesting for the DOE to revisit,” Atty. Nethercott stressed.
Nethercott clarified that “IEMOP has no vested interest in WESM operations. We have a mandate and we are faithfully performing that directive.”
Nethercott belied accusations that IEMOP has caused higher power costs and added that on the contrary, it had significantly lowered the cost of market operations since it took over the WESM in 2018.
“IEMOP has in fact saved up to Php 58.295 million in 2019 and Php 68.199 million in 2020, reduced the total market transaction fees in the WESM, and has consistently operated the WESM up to industry standards,” he said
IEMOP earlier cried foul over recycled criticisms and accusations of corruption and mismanagement as well as those who question the legality of its operations.
IEMOP officials said in an official statement that everything is laid down on the table as far their operations are concerned and they function as an Independent Market Operator (IMO) for the Wholesale Electricity Spot Market (WESM) within the bounds of the law.
They added that its operation of the WESM is sanctioned by law under Republic Act (R.A.) No. 9136, or the Electric Power Industry Reform Act (EPIRA) which mandates that the WESM should be operated by an entity independent of the government and industry players.
Consequently, and pursuant to this law, the Department of Energy (DOE) promulgated DOE Circular No. DC2018-01-0002, titled “Adopting Policies for the Effective and Efficient Transition to the Independent Market Operator for the Wholesale Electricity Spot Market.”
One official said that the “smear campaign” is aimed at discrediting them in public by a group who wants to takeover and advance their own agenda at their expense.
“These malicious attacks against IEMOP and its directors and officers, therefore, are not only actionable, legally but are also groundless, operationally,” he added.
The statement also said that IEMOP took over WESM operations pursuant to law and the Department of Energy (DOE) policy (which has the force of law) and will continue to fulfill its mandate – again, pursuant to law and DOE policy.
IEMOP will abide by whatever policy the DOE establishes – even one that amends or altogether supersedes the very policy effecting the transition of WESM operations to IEMOP.
He added that interestingly, the policy that led to the transition of WESM operations to IEMOP was never questioned before our courts. DOE Circular No. DC2018-01-0002, unless revoked or superseded by subsequent legislation, is valid and binding on all energy participants.
“Even the ERC, which has since refused to acknowledge IEMOP, has never questioned the circular.”