=== dc2014-10-0019-pages-1.ppm ===
; gd Republic of the Philippines
Meg ~DEPARTMENT OF ENERGY

DEPARTMENT CIRCULAR NO. DC2014 -1-p019
“av

REVOKING SECTION 1 OF DEPARTMENT CIRCULAR NO. DC2013-12-0029
ENTITLED “ADOPTING AN INTERIM CRITERIA FOR THE DECLARATION OF
MARKET INTERVENTION IN THE WHOLESALE ELECTRICITY SPOT MARKET”

WHEREAS, Section 37 of the Republic Act No. 9136, otherwise known as the “Electric
Power Industry Reform Act of 2001” (EPIRA), the Department of Energy (DOE) is mandated
to, among other things to:

a) Supervise the restructuring of the electric power industry;

b) Formulate rules and regulations as may be necessary to implement the objectives
of EPIRA; and

c) Exercise such other powers, as may be necessary or incidental to attain the
objectives of EPIRA;

WHEREAS, on 28 June 2002, the DOE, upon the joint endorsement of the electric power
industry participants, promulgated the WESM Rules through Department Circular No.
DC2002-06-003;

WHEREAS, on 27 December 2013, the DOE promulgated Department Circular No. DC2013-
12-0029 adopting the four percent (4%) supply of electric power shortfall as an interim
criteria for the declaration of Market Intervention by the Market Operator until the DOE
through a study conducted by the National Transmission Corporation (TransCo), the
National Grid Corporation of the Philippines (NGCP) and the Grid Management Committee
(GMC) determine a new applicable criteria;

WHEREAS, on 8 April 2014, the TransCo, NGCP and GMC submitted their Report to the
DOE pursuant to the above DOE Circular which noted that four percent (4%) supply
shortfall interim trigger is already covered in the System Operator's declaration of market
intervention under system emergency, in accordance with the WESM Rules;

WHEREAS, in the same Report, TransCo, NGCP and GMC, as an alternative, recommended
for the DOE to pursue a price cap in the WESM to protect the public from high prices of
electricity;

WHEREAS, on 05 May 2014, the Energy Regulatory Commission (ERC) adopted and issued
the secondary price cap in the WESM through its ERC Resolution No. 8, Series of 20134,
entitled “An Urgent Resolution Setting an Interim Mitigating Measure in the Wholesale
Electricity Spot Market” and have extended its effectivity through ERC Resolution No. 14,
Series of 2014, for a period of one hundred twenty (120) days from 10 August 2014 or until
the establishment by the ERC of a permanent pre-emptive measure in the WESM, whichever
comes earlier;

Energy Center, Rizal Drive, Bonifacio Global City, Taguig, Metro Manila, Philippines
Tats. (Trunks) 840-1401 to 40; Fax 840-2067; 840-2235; 840-2067 (Domestic); 632-840-2173; 632-840-2236; 632-640-2067
(International)

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NOW THEREFORE, given the foregoing and pursuant to its authority under the WESM
Rules, the DOE hereby revokes the Interim Criteria for the Market Intervention by the
Market Operator as provided under Section 1 of DC No. 2013-12-0029.

This Circular shall take into effect fifteen (15) days from its publication in at least two (2)
newspapers of general circulation and shail remain in effect until otherwise revoked.

Issued this at Energy Center, Rizal Drive, Bonifacio Global City, Taguig City.

Ff, fase

CAR JERICHO L. PETILLA
Secretary

Bd ease Rene

WEL |
OCT24 2014

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