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Households will likely pay more for utility bills as the electricity tariff will increase by 3.1 per cent for the October to December 2021 period compared to the July to September quarter.

SP Group said on Sep. 30 the rise is due to the higher cost of fuel for producing electricity by the power generation companies.

How much?

The tariff for households will go up from 23.38 cents to 24.11 cents per kWh, excluding Goods and Services Tax (GST).

Including GST, the rate is 25.80 cents per kWh.

Average price increase

SP Group estimated that the average monthly electricity bill for HDB three-room flats is set to increase by S$2.06, before GST.

For four-room flats it will go up by S$2.49.

What makes up electricity tariff?

Electricity tariffs every quarter are reviewed by SP Group based on guidelines set by the Energy Market Authority (EMA).

Four components make up the electricity tariff.

The energy costs component is adjusted quarterly to reflect changes in the cost of fuel and power generation, which is paid to generation companies, SP Group said.

The fuel cost is the cost of imported natural gas that is linked to oil prices by commercial contracts.

The cost of power generation mainly covers the costs of operating the power stations, such as the manpower and maintenance costs, as well as the capital cost of the stations, SP Group said.

Another component is the network costs and market support services fees paid to SP Group.

There is also the market administration and power system operation fees paid to the energy market company and power system operator.

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Top photos via Unsplash