Singapore electricity retailers up offerings to meet raised demand amid Middle East conflict
38.4% of households were on fixed-price plans by Sept 1, up from 36.6% on Feb 1.
Singapore's electricity retailers have introduced new offers to address the rising demand for fixed-price electricity contracts amid heightened concerns over energy costs resulting from the Middle East conflict. According to the Energy Market Authority (EMA), the proportion of households on fixed-price plans surged from 36.6% on February 1 to 38.4% on September 1. The share of households purchasing electricity at the regulated tariff through SP Group fell from 63.4% to 61.6% over the same period.
The EMA suggested that the growth in households opting for fixed-price contracts could be due to a combination of factors, including consumers' efforts to shield themselves from potential tariff hikes and the formation of new households during this period. The electricity tariff set by SP Group and regulated by the EMA, influenced mainly by energy costs, has been increasing since the US and Israel initiated strikes on Iran on February 28.
Currently, the tariff stands at 31.91 cents per kilowatt-hour, the highest level to date, with the rate for the fourth quarter commencing on October 1 still to be announced.
Retailers responded to the heightened interest in fixed-price plans, as households seek greater certainty regarding their power bills. Geneco, Singapore's largest residential electricity retailer, serving more than 175,000 households, launched a fixed-price plan promotion following the third-quarter tariff increase, offering an additional $200 rebate to SP Group customers who switch over.
The CEO of Geneco, Lim Han Kwang, attributed the surge in sign-ups to customers desiring better planning of their electricity spending, insulated from fluctuations in the regulated tariff during the contract period.
PacificLight Energy, too, has witnessed increased interest in its fixed-price plans, introducing a discounted-off-tariff plan in July, which provides customers an 18% discount off the regulated tariff, with a daily charge of 55 cents a day, including GST. General manager Geraldine Tan highlighted that the new plan will offer households greater flexibility and a wider range of choices to manage their electricity costs.
Keppel Electric reintroduced its Suresave discount-off-tariff plan, which was previously removed from its website in mid-March. The plan, offering a 15% discount on the regulated tariff and no early termination fees, is now available with a 12% off the regulated tariff rate, with no contract lock-in for customers on SP Group. Keppel Electric declined to comment on the matter.
Senoko Energy's head of commercial and corporate communications, James Chong, noted an increase in sign-ups and inquiries from existing customers seeking early renewal of their fixed-price plans. Chong mentioned that, despite structural changes in product offerings since the Middle East conflict began in February, there has been growing interest in fixed-price plans amid heightened attention on energy prices.
Other retailers, such as Tuas Power, Sembcorp Power, and Flo Energy, have also observed sustained increases in customer sign-ups since March. Sembcorp Power's senior vice-president, Lim Sam San, mentioned that most contracts signed are for more than two years, reflecting customers' expectations for the future. However, Sembcorp Power did not respond to ST requests for comment.
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