The Energy Regulatory Commission (ERC) has issued Resolution No. 14, Series of 2026, providing clarificatory guidelines on the implementation of the Modified Administered Price (MAP) in the Wholesale Electricity Spot Market (WESM), consistent with the government’s response to the State of National Energy Emergency under Executive Order No. 110.
The resolution addresses operational and settlement concerns raised by industry stakeholders during the recent market suspension and reinforces the ERC’s commitment to consumer protection and market stability.
A key feature of the Resolution is the adoption of a one-time Bilateral Contract Quantity (BCQ) redeclaration mechanism for coal-fired power plants that were available but constrained or curtailed due to instructions from the System Operator.
The mechanism enables affected generators and their counterparties to align contracted energy volumes with actual dispatch conditions during the suspension period. Any resulting load exposure from the redeclaration, however, shall be borne by the coal-fired power plant in favor of its counterparty.
The ERC likewise maintained the existing settlement treatment for the Kalayaan Pump Storage Power Plant (KPSPP), with transactions continuing to be settled at customer administered price (AP). In addition, the Commission authorized KPSPP to claim compensation for pumping operations conducted upon instruction of the National Grid Corporation of the Philippines (NGCP), recognizing the plant’s vital role in maintaining grid stability and ensuring that system support services are appropriately compensated.
ERC Chairperson and CEO Francis Saturnino C. Juan underscored the importance of balancing market integrity with consumer welfare.
“This resolution ensures that extraordinary market conditions are managed in a fair, transparent, and orderly manner. By clarifying settlement rules and addressing unintended cost exposures, we are protecting consumers from unnecessary price volatility while preserving the integrity of the electricity market,” Chairperson Juan said.
The guidelines provide greater regulatory clarity on the treatment of energy transactions during market disruptions, improving billing accuracy and reducing uncertainty in settlements. These measures are expected to support more stable electricity pricing for consumers.
The resolution also seeks to mitigate sharp and unpredictable increases in electricity rates by preventing undue cost exposures from being passed on to customers. By ensuring that costs are allocated properly, the ERC aims to minimize market distortions and protect consumers from inefficiencies that could affect electricity bills.
For generation companies, particularly coal-fired power plants, the BCQ redeclaration mechanism provides a practical and equitable solution for instances where plants were unable to dispatch due to system constraints. The approach allows financial exposures to be managed through contractual arrangements rather than distorted market outcomes.
Overall, the issuance of Resolution No. 14 forms part of the ERC’s broader strategy to safeguard consumers, stabilize electricity prices, and ensure the continued reliability of the country’s power system amid global energy uncertainties.
