Electricity tariff for households to increase by 5.6% for the first quarter of 2022

SINGAPORE: The electricity tariff for households will increase by an average of 5.6 per cent for the January to March period next year, compared with the previous quarter, SP Group said on Thursday (Dec 30).

The rise is due to higher fuel costs, it added.

Excluding Goods and Services Tax (GST), the tariff for households will go up from 24.11 cents to 25.44 cents per kWh for the quarter ending Mar 31, 2022.

Including GST, the rate will be 27.22 cents per kWh.

This increase will mean the average monthly electricity bill for families living in four-room Housing Board flats will increase by S$4.70 before GST, said SP Group.

“Around 95 per cent of Singapore’s electricity is generated using imported natural gas at prices indexed to oil prices,” it added.

"Over the past few months, a confluence of recovering economic activity, severe weather events, and a series of gas production outages have sent global energy market prices significantly higher. These factors have raised electricity prices in many markets."

SP Group reviews the electricity tariffs every quarter based on guidelines set by the Energy Market Authority (EMA).

The electricity tariff consists of four components – energy costs paid to the generation companies, network costs and market support services fees paid to SP Group, as well as market administration and power system operation fees paid to the energy market company and power system operator. 

SP Group said the energy costs component is adjusted quarterly to reflect changes in the cost of fuel and power generation. 

The fuel cost is the cost of imported natural gas, which is tied to oil prices by commercial contracts. 

The cost of power generation mainly covers the costs of operating the power stations, such as the manpower and maintenance costs, as well as the capital cost of the stations, SP Group said.