Amid the continued grid alerts in the region, consumers in Visayas may see lower power bills this month following a decline in wholesale spot market prices, according to the Independent Electricity Market Operator of the Philippines (IEMOP).

In a media briefing on Thursday, Aug. 6, IEMOP vice president for trading operations Isidro Cacho said Visayas residents could see their power rates ease this month following a 21.9-percent decline in Wholesale Electricity Spot Market (WESM) prices to ₱11.29 per kilowatt-hour (kWh), compared to the previous rate of ₱14.46/kWh.

“We will see a drop especially in Visayas, because last month, the June billing month, the market price was high and their exposure to the market was high,” he said.

This price decrease was driven by a 3.6-percent increase in power supply in the area to 2,260 megawatts (MW), while demand in Visayas fell by four percent during the July period.

“Before, Visayas saw [its] large power plants go on forced outages. Now, they’re coming back… In the coming days or weeks, hopefully, other power plants go back online, and we’ll see that by September we would have better power margins for Visayas,” Cacho elaborated, noting that demand is typically lower during the colder months.

Once the supply situation improves across all regions, the IEMOP official said there is a high chance for spot market prices in Visayas and Mindanao to return to single digits. Mindanao’s WESM rate as of July stood at ₱10.39/kWh, about 18.5 percent lower than the ₱12.75/kWh recorded in the previous billing period.

Although supply in Mindanao eased to 3,283 MW from 3,291 MW, demand likewise slowed by 2.9 percent.

Furthermore, Cacho said the recent grid alerts in Visayas, especially the prolonged yellow and red alerts, were caused by the intermittent nature of the region’s renewable energy (RE) buildup, particularly as more areas adopt solar power. Cacho noted that the majority of the alerts are issued during the evening, when solar generation is unavailable.

“Visayas is a net importer [from] Luzon [and] Mindanao. And because of the large load in Cebu, Negros, and Panay, there is an opportunity for the expensive plants to set prices in the market. So it’s really all about supply and demand,” he explained.

Meanwhile, Luzon’s spot market prices decreased by 8.2 percent to ₱7.30/kWh despite a 3.9-percent decline in power supply to 15,043 MW during the period. Demand, however, also fell by 3.3 percent to 10,764 MW.

The system average price for July stood at ₱8.31/kWh, about 13 percent lower than the previous month’s ₱9.56/kWh. Both power supply and demand declined in July by 2.6 percent and 3.4 percent, respectively.