Singapore households should brace themselves for a slight increase in electricity and gas tariffs for the third quarter of the year. SP Group, the utilities provider, announced the anticipated rise, citing higher energy costs compared to the previous quarter. While the increase is modest, it marks a departure from the downward trend observed in the past three quarters. This article examines the factors behind the tariff adjustments and provides an overview of the expected impact on households.
Electricity Tariff Increase
Starting from July to September, the average monthly electricity bill for families residing in four-room HDB flats will see an increase of S$1.14 before Goods and Services Tax (GST). SP Group stated that the electricity tariff will rise by an average of 1.2 percent, equal to around 0.31 cents per kWh before GST. This adjustment is primarily driven by the higher energy costs during this period. The previous quarters had witnessed tariff decreases, making this the first upward adjustment in some time.
Components of Electricity Tariff
The electricity tariff comprises four key components: energy costs paid to generation companies, network costs and market support services fees paid to SP Group, market administration fees, and power system operation fees. The energy costs component is subject to quarterly adjustments based on fuel and power generation expenses. Imported natural gas costs, linked to oil prices through commercial contracts, significantly influence fuel costs. Power generation costs encompass operational and maintenance expenses, as well as capital costs associated with power stations.
Gas Tariff Increase
In addition to the electricity tariff adjustment, gas tariffs for households will also see a rise during the same period. City Energy announced an increase of 0.23 cents per kWh, taking the gas tariff from 21.68 cents per kWh to 21.91 cents per kWh before GST. The adjustment reflects changes in gas prices and factors affecting the overall cost of gas supply.
Impact on Consumers
For households, the increase in electricity and gas tariffs may lead to a slight rise in monthly utility bills. While the impact varies depending on consumption patterns, families living in four-room HDB flats can expect an average increase of S$1.14 for electricity. It is crucial for consumers to be mindful of their energy usage and explore energy-saving practices to mitigate the impact of these tariff adjustments.
Conclusion
The upcoming increase in electricity and gas tariffs for the July-September period in Singapore reflects higher energy costs during this timeframe. While the adjustments are relatively modest, they serve as a reminder for households to be mindful of their energy consumption. Implementing energy-saving measures can help minimize the impact on monthly utility bills. As energy costs fluctuate, staying informed about tariff adjustments and understanding the components of electricity and gas tariffs can empower consumers to make informed decisions about their energy usage and expenditure. Also learn about Singapore’s Core Inflation Eases to 4.7% in May, Reflecting Decline in Services and Food Prices.
