Song Fa Bak Kut Teh restaurants have been able to achieve cost savings of 2-3 percent on their electricity consumption across their outlets island-wide. "This initiative has helped lessen the impact of rising cost," says Ms Diana Yeo, the company's Business Development Manager.
The popular restaurant chain is among small and medium enterprises (SMEs), including SMD Manufacturing Pte Ltd, Kleen-Pak Products Pte Ltd and logistics firm Huationg Pte Ltd, to benefit from the latest round of electricity retail market liberalisation. Cost savings range from 3-12 percent monthly on electricity bills.
Kleen-Pak Products Pte Ltd's Managing Director, Mr Tan Hock Kiam, sees this as a positive move, adding that the liberalisation of the electricity retail market will "benefit our cash flow situation", as "we can now enjoy more cost savings".
The retail electricity market has been liberalised in phases since 2001. On 1 April 2014, the threshold for consumers to be contestable was lowered from 10 megawatt-hours (MWh) to 8 MWh.
Currently, fifteen town councils have also signed up for contestability under this initiative and their savings collectively amount to about 10 percent off the regulated tariff. This works out to an estimated $640,000 in monthly savings.
The latest round of liberalisation enables more non-residential consumers to buy electricity from different retailers at market prices, instead of buying from SP Services at regulated tariffs. In addition, eligible consumers with multiple electricity accounts at different locations can combine their electricity consumption to be considered for contestability.
The threshold will be further lowered to 4 MWh on 1 October 2014 to allow more consumers to benefit from competitive pricing. In total, 15,000 more consumers (or 64,000 accounts) will become eligible for retail contestability.