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SINGAPORE – Electricity and gas rates will go up in the next three months, but will continue to be among the lowest in years.
Roughly half of Singapore’s 1.4 million households can expect electricity rates to increase by an average of around 9 percent from today to December 31, compared to the previous three months, SP Group said Wednesday. (September 30th).
But prices are still the second lowest in three years.
City Gas said gas rates will increase in the fourth quarter by about 5 percent for households. They are at their third lowest level in three years.
Industry regulator Energy Market Authority (EMA) said the changes to electricity rates apply to only 53 percent of households that purchase electricity from SP Group at the regulated rate.
They do not apply to the remaining 47% of households that, at the end of June, have switched to a retailer on the open electricity market.
In the last quarter of the year, households powered by SP Group will see electricity rates rise from 19.6 cents to 21.43 cents per kilowatt hour (kwh), before goods and services tax (GST) of 7 percent .
This means that the average monthly electric bill for families living in four-bedroom flats from the Housing Board will increase by $ 7.01.
Gas rates for households increased 0.83 percent per kWh, from 16.36 cents last quarter to 17.19 cents this quarter per kWh, before GST.
SP Group and City Gas review electricity and gas rates on a quarterly basis according to the guidelines established by EMA.
SP Group said the increase in electricity prices from this month to December is due to higher energy costs, which determine about 73 percent of rates in the quarter, and are paid to power generation companies.
Other components of the electricity tariff, such as network costs and market support services, remain unchanged.
City Gas said gas rates have also increased due to increases in the cost of fuel.
But early in the third quarter, electricity rates fell 15 percent and gas rates fell 4 percent, following a drop in the second quarter as well.
Professor Subodh Mhaisalkar, executive director of the Energy Research Institute at Nanyang Technological University, said the Covid-19 pandemic led to a global drop in fuel prices, in this case for oil, in March.
“Economic activity is not what it used to be and oil prices are forecast to be low until demand rises to match supply,” he said.
However, with the easing of Covid-19 safety restrictions, Professor Mhaisalkar added that most analysts are forecasting a modest increase in fuel prices and therefore an associated increase in fuel prices is expected. electricity.
But if electricity retailers rely on green energy sources like solar, he said, they could keep rates unchanged even if fuel prices rise.
One open market electricity retailer that is lowering prices slightly, rather than raising them, is iSwitch.
Andrew Koscharsky, iSwitch’s chief commercial officer, said the company will reduce the rate on its fixed-price contract by 0.6 percent, from 15.79 to 15.69 cents per kWh (before GST).
The retailer, which has more than 100,000 customers, said this price will apply to its six-month contract for customers.
On how iSwitch can lower prices despite increases in fuel costs, Koscharsky said the company can pass the cost savings on to its customers because it is not subject to the same “expensive overheads that can be tied to a business. of traditional public services ”.
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