The Wholesale Electricity Spot Market (WESM) in the Philippines posted a significant 14.3% drop in power rates in January, according to latest data from the Independent Electricity Market Operator of the Philippines (IEMOP).
As of January 25, the price per kilowatt-hour (kWh) fell to P2.96 across the country, compared to December’s P3.45 per kWh. The decline is attributed to reduced power demand even though supply levels remained relatively stable.
The overall decrease in demand for electricity played a crucial role in the price drop. Aggregate national demand fell 5.6 percent from 13,275 megawatts (MW) in December to 12,529 MW. On the supply side, average availability dropped marginally by 0.2 percent to 20,110 MW from 20,150 MW, a reflection of a tight balance between supply and demand.
The regional breakdown further underscores the significant shifts:
- Luzon saw a price drop of 8.5 percent to P2.98 per kWh, with demand in the region slipping 6.4 percent to 8,741 MW.
- In Visayas, prices dropped more sharply by 19.1 percent, settling at P3.13 per kWh. Demand in the region also fell by 4.4 percent.
- The Mindanao grid experienced the largest drop, with prices plunging by 31.9 percent to P2.65 per kWh, despite a slight 2.9 percent dip in demand. Interestingly, supply in Mindanao increased by 8.7 percent, signaling a regional shift toward surplus capacity.
- IEMOP’s data also indicated a minor decrease in energy generation, with total output falling by 2.75 percent to 8,991 gigawatt hours (GWh) in January, down from December’s 9,245 GWh.
The price drop comes at a critical time for the economy, offering potential relief for consumers and businesses alike. Lower electricity prices could ease inflationary pressures, which have been a major concern in the region. However, experts warn that the longer-term economic effects will depend on how supply-demand dynamics evolve throughout the rest of the year.
These figures are preliminary, and IEMOP cautioned that final data for January could still change as the full-month developments are assessed.
