Retailers have the flexibility to vary their prices and business strategies, to adapt to current market conditions and the level of competition in the electricity market. They also have the flexibility to select the consumers they prefer to serve (e.g. large families, business consumers, etc.), to customise their price plans (e.g. by bundling other services/products) and to impose terms such as contract lock-in periods or early termination charges.
On the other hand, SP Group is required by the Government to supply electricity to all consumers in Singapore, including those who are not supplied by retailers for any reason. SP Group has no flexibility to pick and choose its customers, or to freely change its electricity prices, which are regulated by EMA to recover the long-term costs of producing and delivering electricity to consumers. SP Group also has to bear the risks from having an uncertain customer base, as it does not tie its customers down to any contract period or charge any early termination fees.
