Current Electricity Tariff in Singapore
In Singapore, the current electricity tariff is 22.55 cents per kWh. This price is not inclusive of the goods and services tax (GST) imposed on goods and services sold in the country. As of 1st April 2021, the electricity tariff inclusive of GST has been 24.13 cents per kWh. This price is expected to remain constant till 30th June 2021.
The electricity tariff in Singapore is revised quarterly to ensure that they reflect the actual cost of electricity in the country. These tariffs are regulated by the Energy Market Authority (EMA), which is responsible for ensuring that the public has access to reliable and secure energy supply. The SP electricity tariff comprises two key components, which are fuel cost and non-fuel costs.
Fuel Cost
The fuel cost is essentially the cost of imported natural gas and it is directly linked to oil prices set by commercial contracts. These oil prices change based on global oil costs, availability, and demand. The fuel cost is calculated using the average natural gas prices obtained from the data of the first two and a half months that precede the quarter.
This ensures that the fuel costs reflect the price of natural gas in the global market. The use of this calculation ensures that electricity distributing companies avoid overcharging their customers for electricity. It also protects the electricity distributing companies from losses, which might be experienced when the fuel prices in the global market rise.
Non-Fuel Cost
Non-fuel costs are related to the cost incurred by the company when generating and supplying electricity to people’s homes and other entities. In the SP electricity tariff, this cost is divided into four sections, which include the power generation cost, network cost, market support services fee, and the power system operation and market administration fees.
Power generation cost or Energy cost: This fee is paid to the companies that generate electricity. It covers the cost of operating the power stations, maintenance costs, capital, and manpower. This fee is also adjusted quarterly based on the changes in prices of natural gas in the global market and the cost of importing natural gas.
Market Support Service (MSS) fee: This is a service fee paid to the electricity distribution company to cater to the services associated with supplying electricity. This fee covers the costs associated with billing, electricity meter reading, management of the retail market system, and data management.
Network Costs
This fee is paid to support the power assets used by the electricity company. The funds associated with the network costs are used to recover the cost of transporting electricity energy through the power grids stationed at different points in the country.
Power System Operation and Market Administration Fees: This cost is paid to the EMA and power system operator to cover the costs of operating the wholesale electricity market.
In Summary | Electricity Tariff in Singapore
Tariffs can help people calculate their electricity bills based on their consumption during a specific month. The electricity bill issued to individuals relying on SP electricity combines the fuel and non-fuel costs. This cost is calculated based on the current tariff. It is essential to note that changes in the prices of natural gas in the global market influences the SP electricity tariff directly