Hey kids,
ever wondered why electricity bills are constantly on the rise?
in case you wondered, how Singapore with no natural resources of her own, and increasing electricity consumption, how do we manage????

Here are some latest updates on how electricity is sourced and generated.

FIVE THINGS ABOUT ELECTRICITY


1. Electricity price is largely determined by the cost of the imported fuel used to generate power. The non-fuel cost, which includes transmission and distribution cost, has remained relatively unchanged.

2. The fuel used to generate electricity is mainly natural gas imported from Indonesia and Malaysia. The gas is fed to power-generation companies (gencos), which sell the electricity they generate to SP Services.

3. In Asia, countries like Japan, Korea, Taiwan and Singapore buy natural gas through long-term contracts at a price which is tied to the price of fuel oil. In the US, however, there is a separate and distinct market for natural gas that determines its price.

4. SP Services, a subsidiary of Singapore Power, buys electricity from the gencos at cost and sells it to households at the same price. The electricity tariff for residential users from 1Oct to 31 Dec is 30.45 cents per kilowatt-hour.

SP Services is not in the position to charge less for electricity because its business is confined to transporting electricity to customers and providing support services like meter reading and billing. The Energy Market Authority regulates the electricity price and ensures that SP achieves cost efficiencies that are passed on to consumers.

5. The Singapore Government tries to reduce the impact of higher electricity prices through U-save rebates. It also conducts programmes to raise awareness of electricity conservation and facilitates efforts by consumers to reduce their utility bills. It has opted not to subsidise electricity because this encourages over-consumption and is unsustainable, as shown by the experience of other countries.

Source: The Electric New Paper, Singapore.
October 24, 2008