Electricity tariffs for households will be cut by about 25 per cent for January to March, in line with lower fuel oil prices.
ELECTRICITY tariffs for households will be cut by about 25 per cent for January to March, in line with lower fuel oil prices.
Households will pay 22.93 cents per kilowatt hour for the next quarter, from the current 30.45 cents following October's sharp 21 per cent spike.
This the first fall since April last year sharper than first since April 2007, following a 40 per cent slide in fuel oil prices, which the price of electricity here is pegged to.
For the next quarter, tariffs are pegged to a lower forward fuel oil price of $92.99 per barrel, against $155.14 per barrel for this quarter, said the Energy Market Authority (EMA) on Thursday.
Fuel costs make up more than half of electricity production costs and prices.
Fuel oil and natural gas are used to produce electricity. Although 80 per cent of Singapore's electricity is powered by natural gas, the price of electricity it pegged to that of fuel oil because there is no natural gas benchmark in the Asian market.
There was a public outcry over the October hike which came even as crude oil prices here slipped to US$50 a barrel levels. There was much criticism on the way electricity prices are calculated here.
The EMA is currently studying other ways of pricing electricity and is expected o release its findings in the middle of next year.
Oil prices sank further in Asian trade on Thursday, falling below US$46 a barrel at multi-year lows in a market dominated by declining demand and dismal economic news, analysts said.
New York's main futures contract, light sweet crude for January delivery, fell 82 cents to US$45.97 a barrel, off a low of US$45.75 on Wednesday
The electricity tariff is reviewed quarterly and adjusted accordingly in line with the fluctuation in the electricity cost.
