Interruptible Load Program (ILP) Primer

 

Dear Members,
 

As the premier business organization supporting the development and growth of Australian, New Zealand (ANZ) businesses in the Philippines, ANZCHAM provides support to enable business development and promote economic policy reforms to nurture the growth of Philippine economy and support entry and expansion of ANZ trade and investments into the Philippines.
 
With the looming energy crisis anticipated to hit Luzon in 2nd or 3rd quarter of 2015, ANZCHAM is supportive of measures that will attract private sector participation to address power and energy gaps.  The Interruptible Load Program (ILP) provides near term solution in generating capacity to avert power shortages.  ANZCHAM will pursue ongoing campaigns to generate membership support for the ILP while it will seek to continuously cooperate with the Joint Foreign Chambers and other business organizations in ensuring a comprehensive energy policy that enables sufficient power supply and competitive power rates in the long term.

Interruptible Load Program (ILP)As the premier business organization supporting the development and growth of Australian, New Zealand (ANZ) businesses in the Philippines, ANZCHAM provides support to enable business development and promote economic policy reforms to nurture the growth of Philippine economy and support entry and expansion of ANZ trade and investments into the Philippines.With the looming energy crisis anticipated to hit Luzon in 2nd or 3rd quarter of 2015, ANZCHAM is supportive of measures that will attract private sector participation to address power and energy gaps.  The Interruptible Load Program (ILP) provides near term solution in generating capacity to avert power shortages.  ANZCHAM will pursue ongoing campaigns to generate membership support for the ILP while it will seek to continuously cooperate with the JFC and other business organizations in ensuring a comprehensive energy policy that enables sufficient power supply and competitive power rates in the long term.


What is ILP?The Interruptible Load Program (ILP) is a program developed by the Department of Energy (DOE) and the Energy Regulatory Commission (ERC) wherein Distribution Utilities (DU) and Participating Customers (PC’s) enter into an agreement for voluntary full or partial de-loading by the PC for a period of time that is mutually agreed between the DU and PC. Companies with stand-by generation capacities who participate in the ILP will be compensated under this program should they use their own generating facilities during instances of power supply deficit.Interruptible Load Program (ILP) is one of the available instruments to help mitigate the energy supply deficiency in the Philippines until new capacities become available on the grid. The program help to ease the anticipated power supply deficit to avert the looming power crisis of 3-hour rotating power outage expected to hit Luzon in early 2015.Targeted ILP contributors are electricity consumers with large embedded generation capacities of at least one MW. De-loading compensation paid to ILP participants will be recovered from all customers of the district utility as part of its total cost of power to be included in its monthly computation of generation rate.

      Objectives of ILP Rules

  •  Address imminent power shortage and augment limited power requirements of Distribution Utilities;
  • Ensure timely compensation and recovery of allowable expense;
  • Ensure transparent and reasonable prices;
  • Protect public interest; and
  • Maintain security, reliability, and quality of supply of power.

De-Loading Programs & Protocols


  1. Request for De-Loading Distribution Utilities (DUs) and Participating Customers (PC) shall enter into an agreement where PC may be requested by DU to de-load for a period of time: 
  •  Fully de-load by disconnecting its delivery point that receives electricity from the DU
  • Partially de-load by reducing its load from DU

        2.  DU and shall agree on number of hours in a month for de-loading.

        3. PC may accommodate any request by the DU in excess of such agreed period of time.

  • March 10, 2010 – Issuance of Resolution No. 8, Series of 2010, “Rules Governing the interruptible Load Program (ILP) of Distribution Utilities (DUs)”
  • February 11, 2013 – DLPC filed a petition to amend the ILP Rules under ERC Case No. 2013-                                   004 RM 
  • March 21, 2013 – Luzon Public Consultation
  • April 10, 2013 – Mindanao Public Consultation
  • April 12, 2013 – Visayas Public Consultation
  • May 6, 2013 – Approval of amendments of ILP Rules – Resolution 8, Series of 2013

 

Activation of ILP


  1. Notice of Power Shortage from Service Operator (SO);
  2. Distribution Utility (DU) Sources from Independent Power Producers (IPPs) with existing/ERC Approved Contracts;
  3. Activate ILP when alternative source is not enough;
  4. Activate Manual Load Dropping (MLD) when ILP is insufficient

 Dispatch Protocol Procedure


  • Preparatory Stage – (45 minutes before activation)
  • Activation Stage – (5 minutes before activation up to during activation)
  • Normalization Stage
                          A. Monitor and record the feeder loading in SCADA where Participating Customers (PC’s) are connected or thru communicating with PC’s contact person together with corroboration from on-site DU personnel;B. Distribution Utitlities to evaluate the system condition and alert the PC to start loading back to normal.C. DU to monitor and record the feeder loading in SCADA where PC’s are connected or thru communicating with PC’s contact person together with corroboration from on-site DU personnel;
Figure 1: Adapted from the presentation of Engr. Alvin Jones Ortega, Chief, Tariffs and Rate Division- Energy Regulatory Commission, September 26, 2014
Assumptions:


  • 5MW Generator requested to be de-loaded for 10hours (2 hours a day for one week)
  • Compensable kWh = 50,000kWh
  • Average Cost of Fuel = Php45/liter
  • Average rate of PC = Php10/kWh
Figure 2: Adapted from the presentation of Engr. Alvin Jones Ortega, Chief, Tariffs and Rate Division- Energy Regulatory Commission, September 26, 2014
Figure 3: presentation of Energy Regulatory Commission, September 26, 2014 
Figure 4: Energy Regulatory Commission, September 26, 2014
  • For purposes of determining the PC’s actual generation cost of fuel, the DU shall file a verified report upon filing of its AGRA report requirements
  • De-loaded kWh will depend on:
    • PC’s actual real-time reading by the DU or
    • Agreed 24-hour load profile based on latest average load profile for previous month, if the DU has not installed real-time metering for PC.
 Amount paid to PC shall be recovered from all customers of the DU as part of its Total Cost of Power to be included in the DU’s monthly computation of Generation Rate, based on the following formula:


1. Qualification of Participating Customer (PC) – Any Customer or group of Customers can be qualified as PC subject to mutual agreement with DU.2. Offer of ILP – DUs shall offer to their Customers the ILP through voluntary availment.3. Metering Equipment – Appropriate metering shall be installed for billing purposes of the PC. If not yet available, the PC shall bear the costs of the metering.
  • Load Curve of the PCs;
  • Determined Average Price of Fuel;
  • Schedule of contracted demand/ERC approved rates per supplier;
  • Schedule of average power deliveries/purchases and corresponding generation cost per supplier for each of the consumption period;
  • Soft copy of all calculations; and
  • Other data deemed necessary by the Commission.
Figure 5: Adapted from doe_ph: INFOGRAPHIC: Understanding the Interruptible Load Program (ILP)
Available Interruptible Hours –refers to the Trading Hours declared by the Participating Customer during which specific customer facilities are available to participate in the ILP, as specified in Annex “A”.Available Interruptible Load refers to the amount of Load per Trading Hour that the Participating Customer has declared as available for De-loading, as specified in Annex “A”.Baseline Load Shape refers to the 24-hour baseline load shape agreed upon among NGCP/DU, RES/IPP and the Participating Customer, as provided in Annex “C”.BCQ refers to bilateral contract quantities.

Billing Period refers to the period commencing at 00:00 hours on the twenty-sixth (26th) day of each calendar month, and ending at 24:00 hours on the twenty-fifth (25th) day of the following calendar month.

Customer Facility –refers to each facility of the Participating Customer specified in Annex “A”.

De-load or De-loading refers to the act of reducing the energy quantities drawn by the Participating Customer from the RES/IPP, which energy quantities are otherwise entitled to be drawn by such Participating Customer from the RES/IPP.

De-loading Compensation refers to the amount in Pesos that the Participating Customer is entitled to receive as compensation for its participation in the ILP during a relevant Billing Period, which amount shall be computed in accordance with the relevant agreement between such Participating Customer and the RES/IPP.

De-loading Hours refers to the number of Trading Hours that the Participating Customer has agreed to De-load, in accordance with the ILP Protocol, during a relevant Billing Period,

De-loaded kWh per Customer Facility refers to the energy quantities De-loaded by each Customer Facility of the Participating Customer specified in Annex “A” during a relevant Billing Period, which shall be computed in accordance with Section 8.1 of this Agreement.DOE refers to the Department of EnergyERC refers to the Energy Regulatory Commission

Interruptible Load Program Protocol or ILP Protocol–refers to the protocol attached as Annex “B”.
Interruptible Load Program or ILP refers to the arrangement among NGCP/DU, the RES/IPP and the Participating Customer whereby the Participating Customer may agree to reduce the energy that it will require to be delivered by its RES/IPP. In the case of ILP between DU, RES and Participating Customer, the reduction in energy quantities shall be re-declared by the RES to DU, subject to payment of compensation by DU to the RES, and the RES to the Participating Customer.
Load refers to the energy quantities that the Participating Customer is entitled to draw from the RES, in accordance with the RES Agreement.Payment for Re-declared BCQ refers to the amount in Pesos that the RES is entitled to receive from DU as compensation on account of the participation of the Participating Customer in the ILP during a relevant Billing Period, which amount shall be computed in accordance with Section 8.3 of this Agreement.Philippine Distribution Code refers to the Philippine Distribution Code adopted by the ERC under ERC Resolution No. 115, for the operation, maintenance and development of distribution systems, including amendments, modifications, exclusions, replacements or re-enactments thereof, as the case may be, and all other sets of rules, requirements, procedures and standards governing distribution utilities in the Philippines.Philippine Grid Code refers to the Philippine Grid Code adopted by the ERC pursuant to its Resolution No. 115 dated December 2001, as may be amended.

Red Alert -An alert issued by the System Operator when the Grid Contingency Reserve is zero, a generation deficiency exists, or there is Critical Loading or Imminent Overloading of transmission line or Equipment, as defined in the Philippine Grid Code.

Re-declare or Re-declaration –refers to the act of submitting revised BCQs to the WESM in accordance with the ILP Protocol.

Re-declared BCQ refers to the energy quantity that the RES Generator, on behalf of the RES, Re-declared as BCQ of NGCP/DU during a relevant Billing Period, which quantity corresponds to the Total RES Confirmed De-loaded kWh.

RES Agreement refers to the retail electricity supply contract between the Participating Customer and the RES.

RES Generator refers to the power generation company which has a power supply contract with the RES for the supply of energy to the Participating Customer.

Total De-loaded kWh refers to the sum of De-loaded kWhper Customer Facility of all the Customer Facilities of the Participating Customer during a relevant Billing Period.

Total RES Confirmed De-loaded kWh–refers to the sum of RES Confirmed De-loaded kWhper Customer Facility, as defined in Section 8.3.1, of all the Customer Facilities of the Participating Customer during a relevant Billing Period.

Trading Hour -refers to an hourly trading period in a trading day in the WESM, as may be amended in accordance with WESM Rules.

WESM refers to the Wholesale Electricity Spot Market.

WESM Rules refers to the rules that govern the administration and operation of the WESM.

 

Source:http://www.erc.gov.ph/

 

 

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