It was reported that electricity tariffs will rise on average about 3.5 per cent in the first quarter of this year and that gas prices will fall (Electricity bills to go up, and gas prices to fall, Dec 30, 2019).
SP Group said in the article that the increase is mainly due to "higher energy cost compared with the previous quarter".
According to the Energy Market Authority Singapore, about 95 per cent of Singapore's electricity is currently generated using natural gas, up from just 26 per cent in 2001, when oil was the preferred fuel.
Therefore, I am surprised by the tariff increase because the natural gas price has been very weak, and has dropped significantly in the past year.
The article also said the tariff is the highest it has been since the period from October to December 2014, when it was 25.28 cents before GST.
Last year, the natural gas price was about 16 to 20 per cent lower than in end-2014.
Can SP Group help consumers understand the reason for the increase?
Alan Chiu Chen Hong