Knowing the electricity tariff in the place where you live is essential to keep power costs in check. Based on the tariff system, one can easily end up with a huge bill at the end of the month and throw all your financial planning into complete disarray. Ever wondered “What is SP electricity tariff in Singapore”? If so, the short answer is that it is 22.21 cents per kWh (inclusive of GST). Let’s take a look at how the tariffs are made and why.
SP Electricity Tariff in Singapore
When residing in Singapore, you can buy electricity from the SP Group (Singapore Power Group) which was the only option available before the beginning of the retail electricity market. The company is regulated by the Energy Market Authority or EMA to ensure that the price is sustainable and accessible to all.
The tariff set by the SP Group is reviewed quarterly and consists of both fuel and non-fuel costs. The former is the cost incurred from the import of natural gas and therefore is tied to the price of oil. The latter is the cost it takes to generate and deliver electricity to households.
The quarterly review of the tariff helps to prevent the price from swinging wildly due to impacts in the oil markets. Unlike countries in the west, a vast majority of the electricity is produced from natural gas (imported) which is the common market practice in most of Asia.
The SP Group cannot set the tariff as it is crucial to ensure that a required amount of funds is recovered to ensure their ability to deliver power to their consumers. Ever since the retail electricity market has become open in Singapore, the SP Group can now share the responsibility with other energy supply companies while maintaining all its commitments to the government. With an open electricity market, consumers can now choose the right services as per their requirements and save costs in the long run.