MANILA – The Energy Regulatory Commission (ERC) has ordered the temporary suspension of the Wholesale Electricity Spot Market (WESM) in all three major grids of the Philippines to safeguard the country’s power supply amid rising global oil prices fueled by Middle East tensions.
The decision aligns with Executive Order 110, issued by Malacañang on Tuesday, declaring a national energy emergency due to global fuel disruptions that have pushed oil prices upward.
ERC said the suspension was prompted by a DOE recommendation and will take effect starting Thursday, from the fifth dispatch interval. “This regulatory action is essential to maintain stability and reliability in the country’s electricity supply,” ERC noted.
During the suspension, the power system will follow the DOE’s Special Operating Guidelines (SOG), which focus on maximizing renewable energy use, conserving limited fuel resources, and providing a structured framework for system dispatch.
All market participants, including IEMOP and NGCP-SO, are required to adhere to the suspension.
In place of normal market operations, ERC will roll out a Modified Administered Pricing (AP) Mechanism, with stakeholder consultations ongoing and a targeted implementation date of April 1, 2026. This approach sets specific pricing rules for different energy sources: coal plants receive fixed rates, natural gas plants follow contracted prices, renewable energy gets preferential dispatch with administered pricing, and oil-based plants are paid according to administered rates when used.
ERC emphasized that prior market prices no longer reflect current realities given geopolitical instability and fuel constraints. The modified pricing scheme aims to protect consumers from sharp price increases while keeping power generators financially viable.
“Protecting Filipino households and ensuring a stable energy supply are our top priorities. Temporarily suspending WESM and adopting a revised pricing framework are crucial steps to mitigate the impact of fluctuating global fuel prices,” said ERC Chairperson Francis Saturnino Juan.
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