DOE approves rules for ancillary reserves market

By Manila Standard Business – December 25, 2019 at 08:40 pm

The Energy Department approved a circular adopting the general framework for the provision and utilization of ancillary or reserve services in the power grid, an official said.

Energy Undersecretary Redontor Delola said the circular was signed by Energy Secretary Alfonso Cusi and was ready for publication.

“We’ll probably publish it in the next couple of weeks… It’s the launch of the reserves market. The policy on AS will also launch the reserves market,” Delola said.

Ancillary services, as defined in the Electric Power Industry Reform Act of 2001, are services that are necessary to support the transmission of capacity and energy from resources to loads while maintaining reliable operation of the transmission system in accordance with good utility practice and the Grid Code.

“We also put contracting caps for the reserves. We fixed the definition, identified the megawatts per type of reserve, how many percent of that should be firm contract of NGCP (National Grid Corp. of the Philippines),”

Delola said.Delola said under the draft policy, 50 percent of each reserve requirement should under a firm contract.

“Right now there are a lot of non-firm contracts. When you need it, because it’s non-firm, they will say they don’t have it,” he said.

Delola said the circular would also launch the technical working group for the ancillary reserves market.

“The new market management system is capable of handling the reserve market. The new market is now ready to actually accommodate the reserves market,” he said.

The draft circular states that any policy or guideline relevant to ancillary services should adhere to several principles to ensure the reliability, quality and security of supply of electric power.

These include safe and reliable operation of the grid taking into account the entry of emerging technologies and the intermittency of variable renewable energy, cost-effective planning for the expansion, rehabilitation, repair and  maintenance of the transmission systems and facilities; and sufficiency of the necessary services to allow seamless operation of the grid.