ERC sets lower WESM fee for 2025–2027

The Energy Regulatory Commission approved a new market transaction fee of PHP 0.0071 per kilowatt-hour for the operation of the country’s electricity market from 2025 to 2027.

The rate, which is lower than the PHP 0.0087/kWh originally proposed by the Independent Electricity Market Operator of the Philippines and the Philippine Electricity Market Corporation, will fund Wholesale Electricity Spot Market operations including its reserve and retail components.

Under the ERC’s final approval, IEMOP will receive PHP 0.0040/kWh while PEMC will receive PHP 0.0021/kWh from the total fixed market fee charged to power generators.

“We disallowed for IEMOP’s budget a total of PHP15,289,270 and for PEMC PHP85,414,000,” Juan said during the October 20 briefing at the ERC main office.

The combined PHP 100.7 million in disallowed expenses covered items the ERC deemed either unsubstantiated or beyond reasonable levels, and after adjustments the approved combined budget for both organizations amounted to PHP 3.307 billion for the three-year period.

Juan explained that approving the new market fees before the start of the year would help the market operators plan their spending responsibly and sustain technical expertise within the sector.

“At least for 2026 and 2027, mayroon nang malinaw na approval kung ano lang ang dapat na gastusan ng IEMOP at PEMC,” he said.

“This way, they can plan their expenses properly and retain experienced staff who help keep the market efficient.”

He also noted that the fees are charged to generators, who may decide whether to absorb the cost or pass it on to their customers through supply contracts.

In the last approved cycle, the total market fee reached PHP 1.015 billion, equivalent to roughly PHP 0.0080/kWh.

The new PHP 0.0071/kWh rate therefore reflects a slight reduction following tighter evaluation of proposed spending and updated energy projections for the coming years.

The Wholesale Electricity Spot Market is the country’s trading venue for electricity established under the Electric Power Industry Reform Act to promote a competitive and transparent power market.

The market has been operated by IEMOP since September 26, 2018, while PEMC now serves as WESM’s governance arm through its board and governance committees.

Market fees are collected from generators transacting in the spot market to cover administration and operations such as pricing, settlement, and data reporting.