30 October 2008, TODAY

Point of View

I refer to 'We are a power service provider' and 'Tariff revision no benefit to power generation companies' (Oct 28). I commend both Singapore Power and Energy Market Authority for their replies. While their explanations are clear as to who undertakes what role in the complicated matter of supply of electricity to Singaporeans, unfortunately, at the end of the day, we are still as confused as ever as to the reasons why our rates are so much higher than those in Hong Kong . Any party care to reply to this simple question?

Chan Chong Leong

Reply From EMA

In TODAY's Point of View (30 Oct 2008), Mr Chan Chong Leong asked why Singapore had a higher electricity tariff than Hong Kong.

The main reason is that the fuel we use for power generation is more expensive. In particular, fuel charges make up 19 cents per kilowatt-hour of the overall electricity tariff in Singapore, but just 5 cents per kilowatt-hour in Hong Kong.

Hong Kong enjoys this significant cost advantage in fuel largely because more than half of its electricity is generated from coal-fired power plants. Coal is cheaper than oil and natural gas, but it is also a dirtier fuel. Hence, the price of this heavy reliance on coal is felt in the impact on air pollution and quality of life. Another ten percent of Hong Kong's electricity comes from nuclear power plants in China which are unaffected by the high global oil price.

In contrast, Singapore's electricity is generated predominantly using imported natural gas, which is indexed to the fuel oil price by commercial contracts. We also do not have a ready source of low-cost energy supplies from our neighbours.

Any comparison of electricity prices across jurisdictions will have to take into account these variations in fuel mix and supply. In fact, our electricity tariff is lower than or comparable to that of countries such as Ireland and Japan which, like Singapore, are highly dependent on imported oil and natural gas to meet their electricity needs.

More EMA's replies to letters in the media:

We provide information in a meaningful, timely manner
28 November 2011, TODAY

Liberalisation has its benefits
27 September 2011, TODAY

Changes in electricity tariff primarily driven by fuel cost movements
25 July 2011, TODAY

Factors do help cushion tariffs against oil price hikes
10 March 2011, TODAY

Put the brakes on electricity price hikes
31 December 2009, My Paper

Tariff increase might lead to repercussions
9 October 2009

Choice of electricity retailers
1 October 2009

Tariff-calculation formula online
29 December 2008, My Paper

Power tariff formula reviewed every 2 years
17 December 2008, TODAY

Doing the power math
10 December 2008, TODAY

Gencos don't make 'extraordinary profits'
9 December 2008, The Straits Times

Energy bill formula still being tweaked
13 November 2008, TODAY

Why HK pays a different price
30 October 2008, TODAY

Fairer comparisons - Japan and Ireland
27 October 2008, The Straits Times

Tariff Revision no benefit to power generation companies
20 October 2008, TODAY

Lower distribution cost moderated tariff increase
16 October 2008, Lianhe Zaobao

Why electricity price hike was needed
10 October 2008, The Straits Times

Lower Electricity Tariff if Price of Oil Continues to Fall
7 October 2008, My Paper

Price electricity properly and give focused help
7 October 2008, My Paper

Towards a more liberal electric mart
7 October 2008, My Paper

Quarterly tariff update accounts for time lag
2 October 2008, My Paper

Higher electricity prices will not adversely affect lower-income families
1 October 2008, Lianhe Zaobao

EMA explains spike
1 October 2008, The Straits Times