In March 2026, the system‑wide average supply decreased to 19,913 MW, a 0.4% decline from February 2026. Coincidently, the average demand increased to 13,383 MW, or 4.0% higher than the previous month. These supply-demand levels resulted in a tighter system supply margin of 4,654 MW, compared to 5,283 MW in February.
With the decrease in the system‑wide supply margin, regional supply–demand conditions showed mixed outcomes. Supply margins in Luzon, Visayas and Mindanao declined by 576 MW, 8 MW, and 46 MW, respectively, due to higher outage levels and variations in HVDC flows. These conditions lead to an incline in the system‑wide average market price to 4.31 PHP/kWh, from 3.50 PHP/kWh last February- a 23.0% increase for March 2026.
In Luzon, the average demand increased by 428 MW compared to the previous billing month, while average supply slightly decreased by 184 MW, resulting in a supply margin decline of 576 MW, primarily due to higher and more frequent planned and forced outages. Consequently, Luzon’s average market price increased to 4.10 PHP/kWh, from 2.69 PHP/kWh in the previous billing month, marking a 52.5% increase.
Alongside Luzon, supply margins in Visayas and Mindanao decreased by 8 MW and 46 MW, respectively. The 236 MW increase in supply in Visayas led to a lower average market price from 5.37-5.08 PHP/kWh. On the other hand, a higher HVDC import and only a slight decrease in margin for Mindanao led to a lower average market price from 5.35-4.43 PHP/kWh.
Under normal conditions, the Visayas grid is supported by power imports from Luzon through the Leyte–Luzon HVDC interconnection. Throughout March 2026, the Leyte-Luzon HVDC link was either operating at its maximum Luzon‑to‑Visayas transfer limit of 250 MW or at a security‑limited transfer level for 27.98% of the billing period, a great drop from the 53.78% restriction observed in February 2026. In addition, the Mindanao-Visayas HVDC flow also experienced an increase in operation at its maximum at 21.80% higher than the 6.86% of the time from the previous billing period. These limitations continued to restrict the flow of lower‑cost Luzon generation into the Visayas, contributing to price separation among Luzon and Visayas-Mindanao.
Several generating units across all grids experience outages throughout the month. In Luzon, forced outages across various technologies, mostly from Coal and Natural Gas reached 8,124.3 MW, while planned outages across various technologies totaled 976.3 MW. In the Visayas, forced outages from various technologies mostly from Biomass and Geothermal reached 991.43 MW, with 83.1 MW of planned outages from coal. In Mindanao, outages totaled 731.8 MW for forced outages and 631.4 MW for planned outages from ROR, Coal, Hydro, and Battery technologies. Additionally, continued congestion along the 230 kV Leyte–Cebu transmission corridor limited internal power transfers and contributed to localized price separation, particularly affecting nodes in Leyte.
Moreover, in terms of system-wide generation mix, renewable energy (RE) accounted for 25% of total generation. Coal-fired and oil-based generation slightly increased its share from 54.6% to 57.2%, and 0.4% to 0.5%, respectively. Oil-based generation was utilized during peak periods in response to unforeseen outages. Similarly, solar generation also observed an increase from 5.3% to 6.5%. On the other hand, hydropower generation decreased from 9.5% to 8.1%, the share of natural gas slightly declined from 17% to 16%, and geothermal also dropped from 8.9% to 7.6%, all of which coincided with the warmer months of the year approaching. For Biomass, PSH, and Battery units, their share remained constant with 1% for Biomass, 0.9% for PSH, and 0.1% for Battery units. The retail market share reached approximately 25% (2.14 TWh) of total customer transactions for March 2026.
Overall, the Effective Spot Settlement Price (ESSP) increased from 4.05 to 4.78 PHP/kWh, marking an 18% increase. Furthermore, the spot market volume decreased in March 2026, accounting for 12.7% of total traded quantity from 13.7% in February 2026. Correspondingly, the total trading amount increased from 10.76 billion PHP to 13.57 billion PHP due to relatively higher prices.
In the reserve market, zonal prices increased across all regions except for Luzon’s Regulation Up and Contingency Reserves, and Mindanao’s Regulation Down, Regulation Up, and Dispatchable Reserves. System‑wide reserve market transactions decreased from 6.08 billion PHP in February to 5.79 billion PHP in March 2026.
Market Suspension
Following its declaration of the suspension of the operations of the WESM in its Order and Notice of Market Suspension, both dated 25 March 2026, the ERC issued on 01 April 2026, ERC Resolution No. 10, Series of 2026 entitled “Resolution Prescribing Modified Administered Price for the Wholesale Electricity Spot Market (WESM) Pursuant to Executive Order No. 110, Series of 2026.
The said Resolution prescribed the Modified Administered Price for the pricing and settlement of spot energy and reserve transactions in the WESM during the period of market suspension, to be governed by certain conditions, without prejudice to dispatch instructions issued by the System Operator under the Special Operating Guidelines of the DOE Advisory dated 25 March 2026.
The key provisions of the Resolution are as follows:
1. Energy Market
- Coal-fired generating facilities shall be settled at a fixed Administered Price (AP) of PhP6,000.00/MWh and are not eligible for additional compensation.
- Preferential and Priority Dispatch generators (including Solar, Wind, Run-of-River Hydro, Biomass, Geothermal, and Impounding Hydro) shall be settled using the applicable AP pursuant to the WESM PDM Manual, with negative AP intervals replaced by zero (PhP 0/MWh), and are not eligible for additional compensation.
- Oil-based, Natural Gas-fired, Battery Energy Storage Systems (BESS), and Pumped Storage Hydro facilities shall be settled using the applicable AP pursuant to the WESM PDM Manual, with negative AP intervals replaced by zero (PhP 0/MWh), and are eligible for additional compensation, subject to existing rules.
2. Reserve Market
- The existing AP mechanism for the Reserve Market pursuant to the Order dated 26 July 2024 in ERC Case No. 2023- 002 RC shall continue to apply.
3. Claims for Additional Compensation
- Additional compensation in the WESM is a mechanism used to provide appropriate payment to generators that were instructed by the System Operator to run during a market suspension. This serves to ensure that generators are adequately compensated if the administered price is lower than the actual cost of operating the generator during the suspension period. Eligible generators may submit claims for additional compensation, along with supporting documents, which will be subject to evaluation by the Market Operator based on established guidelines.
- Eligible facilities: Natural Gas‑fired, Oil‑based, Battery Energy Storage Systems (BESS), and Pumped Storage Hydro facilities.
- Recovery mechanism: If the calculated customer rate impact exceeds PhP0.005/kWh, approved claims and corresponding payments shall be recovered over three (3) equal installments across three (3) successive billing periods, starting on the scheduled date of the billing period immediately following the approval of the claim.
These provisions apply solely to ERC Resolution No. 10, Series of 2026, and do not amend or replace existing market rules unless expressly approved by the ERC.
The Modified Administered Price shall take effect starting from the dispatch interval at 00:05H on 26 March 2026 and shall remain in effect until the ERC lifts the market suspension.
