Measures to secure Singapore’s energy supply extended until end-March 2023 amid protracted global volatility
SINGAPORE: Measures put in place to enhance Singapore’s energy security and resilience will be further extended until the end of March next year, amid protracted volatility in the global energy market and the conflict in Ukraine, said the Energy Market Authority (EMA) on Thursday (Jun 16).
The measures were previously extended until Jun 30.
"While we cannot shield consumers from higher electricity prices, it is vital that the global volatility does not disrupt our electricity supply and impair the functioning of our energy markets," said EMA.
The world has seen an energy crunch since September last year, with global gas prices significantly higher due to high demand and tight gas supply.
With the Russia-Ukraine war and the seasonal increase in energy demand during the coming winter months, energy markets are expected to remain volatile, said the authority, noting that countries in Asia and Europe have started to secure fuel supplies, including gas, in preparation for the winter.
As Singapore relies on imported natural gas to generate around 95 per cent of its electricity, the volatility in global energy markets will “spill over into our domestic market”, said EMA. Higher fuel prices globally will also push up domestic electricity prices, it added.
“EMA will monitor the situation and consider extending the measures further if necessary, depending on the global energy situation and its impact on Singapore,” said EMA.
The authority in October last year laid out a series of measures to safeguard Singapore's energy supply, including setting up a standby LNG facility for generation companies to draw from to generate electricity when their natural gas supplies are disrupted.
Generation companies have also been directed to maintain sufficient fuel for power generation, based on their available generation capacity, in addition to the existing requirement for fuel reserves that they are required to maintain under their licences.
Modified rules also allow EMA to direct generation companies to generate electricity using the gas from the standby LNG facility preemptively, if there are potential shortages in energy supply in the Singapore Wholesale Electricity Market.
These measures have helped ensure sufficient fuel and electricity supply as well as stabilise the Uniform Singapore Energy Price to around the cost of electricity production – an average of S$350 per megawatt-hour (MWh) in the first five months of the year.
Apart from the measures, the Temporary Electricity Contracting Support Scheme (TRECS) will also be extended until end-March 2023, said EMA.
The scheme helps large consumers with an average monthly consumption of at least 4MWh secure fixed price plans and retail contracts with significant fixed price components.
Energy suppliers such as Sembcorp Power and Keppel Electric will also continue to offer longer-term fixed price plans for consumers with average monthly consumption from 4MWh to 50MWh, said EMA, adding that it will monitor the situation closely and introduce new measures if necessary.
These plans range from six months to three years, with the fixed electricity rate for two-year and three-year plans priced at 25 cents per KWh, excluding third-party charges such as transmission charges and market charges.
The sign-up window for these plans for July will be open on Friday, said EMA.
EMA also noted that the Household Support Package introduced in Budget 2022 will help eligible households defray the costs of higher electricity bills. Meanwhile, businesses in need of financial support can tap on loan programmes offered by Enterprise Singapore.
“We also urge consumers to do their part to conserve energy. Households can reduce their energy consumption by using energy-efficient appliances and adopting energy saving habits,” said EMA.
In April, Second Minister for Trade and Industry Tan See Leng told Parliament that it was "not tenable" for the Government to subsidise electricity consumption in Singapore, and that consumers should be mentally prepared to face higher electricity bills over time.
SP Group also announced in the same month that it would raise regulated tariff rates for its consumers by about 10 per cent.