=== dc2015-11-0016-pages-1.ppm ===
Republic of the Philippines
DEPARTMENT OF ENERGY

DEPARTMENT CIRCULAR NO. DC 2015-|! ~ 00!1G@
ad

ADOPTING FURTHER AMENDMENTS TO THE WESM RULES AND MARKET
MANUALS
(Provisions for Over-riding Constraints, Disputes, Verification of Must-Run Units, and
Settlement Formulation Between Must-Stop Units and Displaced Generators)

WHEREAS, Section 37 of the Electric Power Industry Reform Act (EPIRA) provides that the
Department of Energy (DOE), jointly with the electric power industry participants, shall
establish the Wholesale Electricity Spot Market (WESM) and formulate the detailed rules
governing the operations thereof;

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, any changes, amendments, and modifications to the WESM Rules shall be
undertaken in accordance with the provisions of Chapter 8 thereof;

WHEREAS, on 04 February 2015, the Rules Change Committee (RCC) during its 97th RCC
Meeting discussed and reviewed the WESM Rules and Market Manuals in compliance with
the PEM Board's directive to the RCC during the 101s* PEM Board Meeting held on 22 January
2015 to further study the rules and provisions connected with the verification of Must-Run
Units (MRU) and Must-Stop Units (MSU) data;

WHEREAS, on 06 May 2015, the RCC during its 100% RCC Meeting finalized the proposal for
amendments to the WESM Rules and Market Manuals on MRU-MSU and Dispute Resolution
Management relevant to the verification of MRU and MSU data, which thereafter approved
its publication in the WESM website to solicit comments from market participants and other
interested parties;

WHEREAS, on 01 July 2015, the RCC during its 1024 RCC Meeting deliberated on the
proposal giving due course to the comments received from several parties, which thereafter
approved the said proposal for endorsement to the PEM Board;

WHEREAS, on 24 July 2015, after due evaluation and deliberation, the PEM Board during its
107% Meeting approved for endorsement to the DOE the above stated RCC proposed
amendments to the WESM Rules and Market Manuals;

WHEREAS, on 31 July 2015, the above stated amendments to the WESM Rules and Market
Manuals were submitted to the DOE for final approval, in compliance with Chapter 8 of the
WESM Rules;

WHEREAS, on 28 August 2015, after due evaluation and deliberation, the PEM Board during
its 108 Meeting also approved the additional proposed amendments of the RCC to the MRU-

law Energy Center, Bonifacio Global City. Taguig City, Philippines ‘a
\ Tel, No. 479-2900: Fax 812-6194

————

=== dc2015-11-0016-pages-2.ppm ===
MSU Market Manual relative to the settlement formulation between MSUs and Displaced
Generators, and to account the house load of the Generators;

WHEREAS, on 07 September 2015, the above stated additional amendments to the MRU-MSU
Market Manual were submitted to the DOE for final approval, in compliance with Chapter 8
of the WESM Rules; and

WHEREAS, the DOE thoroughly reviewed the abovementioned PEM Board-approved
amendments to the WESM Rules and Market Manuals, and deemed it consistent with the
objectives of the WESM.

NOW THEREFORE, pursuant to its authority under the EPIRA, WESM Rules, the DOE
hereby adopts, issues, and promulgates the following amendments to the WESM Rules and
relevant Market Manuals:

Section 1. Amendments to the WESM Rules.
(a) Clause 3.5.13.1 under Over-riding Constraints is amended to read -

“3,5.13.1 Subject to WESM Rules Clause 3.5.13.3, the System Operator
may require the Market Operator to impose constraints on the power
flow, energy generation of a specific facility in the grid to address system
security threat, to mitigate the effects of a system emergency, or to
address the need to dispatch generating units to comply with systems,
regulatory and commercial tests requirements.

The System Operator, in consultation with the Market Operator and the
Trading Participants, shall develop the criteria and procedures for
dispatch of generating units that are required to run as a result of the
imposition or relaxation of constraints stated in the preceding
paragraph, and the manner for compensating said units.

The System Operator shall advise the Market Operator of the actions it
has taken in relation to the foregoing, including but not limited to
information necessary for the proper settlement of affected generating
units, and the Market Operator shall publish the said information no
-later than one (1) week from the relevant trading day. For proper
settlement of must-run units and must-stop units, Trading Partictpants
shall review the information and notify the Market Operator of any
discrepancies no later than two (2) weeks from the date of publication,
otherwise the information contained in the report shall be deemed
final for use in the settlement of must-run units and must-stop units”

(b) Clause 3.14.8.2 under Disputes is amended to read -

“3,14.8.2 Disputes in respect of final statements or the supporting data
provided with them in accordance with WESM Rules Clause 3.14.5
shall be raised within twelve (12) months of the relevant billing
period, provided, however, that the data contained in reports

DC2015-1]-0016 — Amendments to WESM Rules (Provisions for Over-riding Constraints, Disputes, Verification
ef Must-Run Units, and Settlement Formulation Between Must-Stop Units and Displaced Generators

a

—

Page 2 of 3
=== dc2015-11-0016-pages-3.ppm ===
submitted by the System Operator pursuant to WESM Rules Clause
3.5.13.1 that have already become final shall not be subject of dispute.”

Section 2. Amendments to the Market Manuals. Pursuant to DOE Circular No. DC2015-07-
0013 entitled “Adopting Further Amendments to the WESM Rules (Procedure for Changes to
the WESM Rules and Market Manuals),” the Market Manuals listed below and presented as
Annexes to this Circular are hereby approved and adopted.

a) Annex A - Management of Must-Run and Must-Stop Units Issue 7.0
b) Annex B - Dispute Resolution Market Manual Issue 5.0

Section 3, Separability Clause. If for any reason, any section or provision of this Circular is
declared unconstitutional or invalid, such parts not affected shall remain valid and subsisting.

Section 4, Effectivity. This Circular shall take effect upon publication in at least two (2)
newspapers of general circulation and shall remain in effect until otherwise revoked.

Issued this November 2015 at the DOE, Energy Center, Rizal Drive, Bonifacio Global City,
Taguig City, Metro Manila.

ZENAIDA Y. este ki

ro

NOV 712 2015

Y SF. Repubiic of the Philiopines
= DEPARTMENT OF ENERGY
3

&,? DUREPLYING PLS. CITE:

an nT

ee
DC2015-17-001G - Amendments to WESM Rules (Provisions for Over-riding Constraints, Disputes, Verification
of Must-Run Units, and Settlement Formulation Between Must-Stop Units and Displaced Generators

Page 3of 3