About Electricity Tariff

There are two key components to the cost of electricity in Singapore. The fuel cost or the cost of imported natural gas is tied to the price of fuel oil by commercial contracts. This fuel cost has been increasing in recent months. In contrast, the non-fuel cost, or the cost of generating and delivering electricity to our homes, has remained largely unchanged over the past few years (See Chart 1).

Detailed Items within the non-fuel cost component

Power Generation Cost
This covers mainly the costs of operating the power stations, such as the manpower and maintenance costs, as well as the
capital costs of the stations.

Grid Charge
This is to recover the cost of transporting the electricity through the power grid.

Market Support Services (MSS) Fee
This is to recover the costs of billing and meter reading.

Power System Operation and Market Administration Fees
These fees are to recover the costs of operating the power system and administering the wholesale electricity market.

The diagram below (Chart 2) shows all the detailed components of the tariff and how they collectively account for the overall rate of 24.13¢/kWh in July to September 2010.