WESM Objectives

To establish a competitive, efficient, transparent and reliable market for electricity where:
 A level playing field for the trading of electricity exists among WESM Participants;

 Third parties are granted access to the power system;

 Prices are governed by commercial and market forces; and

 Efficiency is encouraged.

Making History
The establishment of the Wholesale Electricity Spot Market (WESM) on __________ is a
landmark achievement for the Philippine Power Industry. It is milestone in the transformation
of the generation sector from a monopoly industry to a fully-competitive market.
(add here a brief narrative of WESM history, from L, to LV, RCOA 1MW, and 750kW)

Basic Features of the WESM

Gross Pool
All energy transactions - like the demand and supply of electricity - are scheduled through
the market. This allows for all the power produced, supplied and used to be accounted in the
market.

Net Settlement
Bilateral contract quantities transacted in the pool are settled outside the market.

Locational Marginal Price

Marginal price is computed at each node or location to reflect transmission loss and/or
congestion.

Reserve Co-optimization
Reserve and energy offers are scheduled at the same time.

Demand Bids
Customers have the option to buy energy at a price lower than the regulated rate.

Mandatory Market
Existing distributors are mandated by law to procure at least 10% of its electricity from the
WESM for the first five years from its establishment. Entities directly connected to the grid
are not allowed to inject or withdraw without registering in the WESM. With the
commencement of Retail Competition and Open Access, Retail Electricity Suppliers are also
___________