SINGAPORE - Residents of some condominiums can expect to fork out more for the maintenance of common areas due to surging electricity bills.
The hardest-hit have been mid-sized private residential estates abandoned by electricity retailers and exposed to the volatile wholesale market, condominium managers and managing agent firms told The Straits Times.
Several have chosen to reconfigure electrical systems to cut costs while others hunt for fixed-price plans.
Mr Nicholas Chew, the Management Corporation Strata Title (MCST) chairman of Changi Green condominium, was aghast when the building's electricity bill trebled from $6,500 to $19,500 for the month of December.
Since the MCST's former retailer i-Switch folded in November last year, it has switched to purchasing electricity from the wholesale market - where prices fluctuate every half-hour - and is in "fire-fighting mode" to secure a long-term fixed-price plan, he said.
"We have cut where we can, and the remaining usage covers essential things like closed-circuit television and walkway lighting," said Mr Chew, adding that the 256-unit property had adopted energy-efficient lighting eight months ago and has switched off air-conditioners in some facilities to save electricity.
"If we are unable to find a contract that lasts beyond a month and electricity bills continue to rise over the next nine months, the MCST will propose an increase to the management fund contribution to cover costs and put it up for a vote," he added.
Wholesale electricity prices started soaring here as a result of the global energy crisis since September last year, driven by increased demand worldwide, production outages due to cold winter months and disruptions to piped natural gas supply from Indonesia.
This sparked the exit of six electricity retailers from the open market between October and December last year and another two prematurely terminated some of their customers' contracts, thereby affecting about 9 per cent of all electricity consumer accounts, said Second Minister for Trade and Industry Tan See Leng in Parliament this month.
While residential and non-residential accounts using a monthly average of less than 4 megawatt-hour (MWh) have the option of switching to SP Services' regulated tariff, private residential properties like Changi Green that exceed the limit cannot do so.
Responding to queries on the rationale for the threshold of 4MWh, the Energy Market Authority (EMA) said this arrangement "protects household and small business consumers as they do not have the bargaining power to negotiate for better retail rates that large electricity consumers would have".
The authorities have rolled out some support to shield large users of electricity from volatility.
In December, EMA launched the Temporary Electricity Contracting Support Scheme (Trecs) to help non-residential accounts consuming 4MWh or more to get month-long fixed-price electricity plans and additional retail plans with "significant fixed price components".
The scheme allows generation companies to draw on EMA's standby fuel facility to generate electricity, therefore reducing the risk that pipe natural gas disruptions might have for them.
In the face of overwhelming demand, the authorities increased capacity of the scheme in January and extended it this month by another three months to May.
A spokesman for A4 International, which oversees 70 estates, said it has still been "very difficult" to get a fixed-price plan, noting that those who are affected tend to be MCSTs with 100 or more units.
He said the electricity suppliers his company contacted have said they were "too overwhelmed as their previous clients are calling to beg them for a proposal, (and they have received) too many inquiries".
He added: "Most of them are so uncertain about the rates, none of them were willing to commit until the late second quarter or third quarter."
Meanwhile, Mr Chew failed to secure a Trecs plan for January, February and March, but managed to secure a one-month contract with Keppel Electric for March at a rate of 39.03 cents.
"It's a very short-term solution, but I hope the one-month contract will put us in good standing to get a 12-month contract," he said.
Two electricity suppliers told ST that they have rolled out more price plans to meet the high demand.
Following the extension of Trecs on Feb 14, Sembcorp Power has rolled out new six- and 12-month contracts for businesses with an average monthly consumption of between 4MWh and 20MWh.
MCSTs can also apply should they fit within the stipulated capacity, said its spokesman. From March 1, those consuming less than 50MWh can sign up for longer-term contracts as well, she added.
Renewable energy retailer Flo Energy has also launched new one-month plans for March with fixed prices that are slightly below Trecs.
Its chief commercial officer Ernst Westendorp said the firm continues to offer longer-term fixed-price plans ranging from six months to two years and one-month fixed-price plans for April as well.
A Geneco spokesman said it has been working closely with EMA to assist large electricity consumers but declined to provide any customer statistics or price information "due to confidentiality and commercial reasons".
Property management agents said several condominiums have given up on the open electricity market and reconfigured electrical systems to get a regulated tariff.
During the heydays of the open market, several managing corporations applied under the Demand Aggregation Scheme (DAS) to let them buy electricity for common areas at retailer rates lower than the regulated tariff.
This involved works to carve out part of the electrical load for common areas under a new sub-metered account.
By reversing the reconfiguration, estates can reconnect to the master meter of SP Services, a subsidiary of SP Group, and qualify for the regulated tariff, said Mr Andy Lim, managing director of Ocean IFM & OIFM International, which oversees 140 strata-titled condominiums.
He added that some MCSTs initially wanted to wait and see whether electricity prices will go down instead of opting to reconfigure their systems, but eventually gave in after noting the fluctuations from the wholesale market and rocketing fuel prices.
"The cost of reconfiguration can range between "a few thousands to ten of thousands, depending on how extensive the works are", Mr Lim said.
A spokesman for the Association of Strata Managers, which represents 22 managing agent firms and over 1,000 management corporations here, said it is unavoidable that all management corporations are affected by the higher electricity bills.
But larger properties with strong financial positions may not need to increase their collection of management funds. They can cope with the hike in the short run as the impact is less significant due to economies of scale, he added.
The A4 International spokesman noted that several MCSTs that enjoyed savings on electricity in previous years will also be able to absorb costs of reconfiguration and therefore do not need to increase management fund contributions.
Responding to Workers' Party MP Gerald Giam in Parliament on whether the Government would consider extending Trecs further, Dr Tan said that global market consultants are cautiously optimistic that natural gas prices would ease somewhat once winter is over and tensions in Ukraine do not worsen.
But power bills could rise further after Russia, a major oil and gas exporter, launched a military attack on Ukraine last Thursday. Oil prices surged past US$100 (S$135) a barrel after Russia's invasion.
Almost all of Singapore's electricity needs are supplied by imported natural gas, which tracks the price of oil, and any impact on global gas prices will mean higher electricity prices for the Republic.