Lower oil prices reduce Singapore power tariff

Singapore Power reduced the electricity tariff for households by 21.37 percent for the second quarter of 2009. This amounts to a reduction from 22.93 cents to 18.03 cents per kWh.

The reduction is largely due to lower fuel oil prices. In line with the current tariff formula, the forward fuel oil price in the month of January 2009 was used to set the tariff for the period. The forward fuel oil price in January 2009 was US$40.58 per barrel. This is 35 percent lower than the fuel oil price of US$62.41 per barrel used to set the current tariff.

This is the lowest rate of electricity tariff since April 2005. On average, taking into account the tariffs for all customer categories, the tariff reduction is 21.72 percent.

The electricity tariff is reviewed quarterly and adjusted in line with the changes in the cost of electricity. The tariff adjustments have been approved by the industry regulator, the Energy Market Authority.