There are two key components of the electricity tariff: fuel cost and non-fuel cost.

The fuel cost component for each quarter is calculated using the average of daily natural gas prices in the first two-and-a-half month period in the preceding quarter.

The non-fuel cost component reflects the cost of generating and delivering electricity to homes. It comprises mainly the grid charge, and the capital and operating costs of generation companies.

The fuel cost component of the electricity tariff for each quarter is calculated based on the average of daily natural gas prices in the first two-and-a-half month period in the preceding quarter.

Consequently, there is a time lag in the gas price reflected in the electricity tariff because changes in gas prices in the current quarter will only be taken into account in the next quarter's tariff. This means that any increase or decrease in gas prices in the current quarter will be reflected in next quarter's tariff.

In Singapore, the price of electricity is not subsidised. This is to price energy correctly so that consumers are incentivised to use electricity efficiently and avoid wasteful consumption.

The Government recognises that there are households which may face difficulties coping with the rising cost of utilities, and is ready to help them. In this regard, the Government assists HDB households with their utilities bills payment through the Utilities-Save (U-Save) scheme, with higher amounts of rebates going to lower-income households.

Electricity meters are read bi-monthly. On those months when the meters are not read, your electricity usage will be estimated based on your past consumption. Any over or under estimation of the bill will be adjusted in subsequent bills when the meter reading is taken.

If your meter is located inside your premises, SP Services' meter readers will need to access your premises to read the meter.

If meter readers are unable to access your premises to take the meter readings, you will be given a "Door Lock Card" providing details to guide you in submitting your meter readings.

If you wish to submit your meter readings, you can do so via the following methods:

i. SP Services website (http://www.spservices.com.sg)
ii. SP Services' smartphone app
iii. Interactive Voice Response system (1800-2222-333)
iv. SMS MRSUBM to "98374797".

The Interactive Voice Response system also allows you to arrange for an appointment to read your meters to avoid being billed on estimates for a prolonged period.

Your utilities usage will be an estimation if SP Services did not receive your meter readings. Until SP Services' meter readers can record your meter readings, you will be billed based on your estimated usage.

You may also refer to the FAQs on SP Services' website if you wish to learn more about meter readings and bill estimation.

The Energy Market Authority continually seeks to develop the electricity market for the benefit of consumers. These initiatives will enable both commercial and residential electricity consumers to enjoy more competitive electricity prices, increased retail options, and greater price transparency.

An example of such market development initiatives is the Electricity Futures Market, which was launched last April. This has enabled independent retailers with new business models to enter the electricity market offering consumers greater retail choices and price competition. For example, Town Councils have seen their electricity bills come down in new tenders. (Please see Question 2 for more details.) Another example is the opening up of the electricity retail market, known as the Open Electricity Market initiative. All electricity consumers will be able to enjoy more choices and flexibility in their electricity purchase options.

To sustain the rollout of such initiatives to benefit consumers, the Energy Market Authority has renamed the "Retail Market System Related Charges" to "Market Development and Systems Charge" (MDSC). The current MDSC charge is 0.3771 cents/kWh. The MDSC forms part of the Market Support Service charges.

The MDSC will support a range of market development initiatives, such as the Electricity Futures Market and the Open Electricity Market. These initiatives will benefit consumers by bringing about competitive pricing and more choices.

More competitive pricing

An example is the cost savings that Town Councils have enjoyed because of the emergence of independent electricity retailers (i.e. retailers not linked to generation companies) that the Electricity Futures Market has facilitated. In the Sep 2015 tender results (shown below) for the supply of electricity, 10 Town Councils were able to enjoy 22% discount off SP tariff – an additional 7.5% in savings compared to the most competitive quote from an existing generation company and retailer. This amounts to about $2.1 million savings a year, which will eventually benefit electricity consumers.

Tender in Sep 2015 for Supply of Electricity to East Coast, Holland-Bukit Panjang, Moulmein-Kallang, Nee Soon, Pasir Ris-Punggol, Potong Pasir, Sembawang, Tanjong Pagar, West Coast and Bishan-Toa Payoh Town Councils
#	Tenderer	Discount % to SP Tariff	Discount (₵/kWh)
1	Independent retailer A	22	4.5 (1.5 better than best offer from incumbent genco)
2	Independent retailer B	18	3.7
3	Independent retailer C	17	3.5
4	Existing generation company and retailer D	14.5	3
5	Existing generation company and retailer E	14.1	2.9
6	Existing generation company and retailer F	13.01	2.6
7	Existing generation company and retailer G	8.5	1.7
8	Existing generation company and retailer H	5	1
9	Existing generation company and retailer I	4.95	1
10	Existing generation company and retailer J	3.2	0.7

The benefits of more competitive prices are not only confined to electricity consumers who buy from independent retailers. Due to the competition from the entry of more players, existing generation companies and retailers are also offering greater discounts to customers. This is reflected in their more attractive bids in a subsequent Town Council tender in Nov 2015 (shown below). Hence the Electricity Futures Market brings about benefits to consumers across the board, and not just to those who participate directly in the Electricity Futures Market.

Tender in Nov 2015 for Supply of Electricity to Ang Mo Kio, Chua Chu Kang, Jurong-Clementi, Marine Parade and Tampines Town Councils
#	Tenderer	Discount % to SP Tariff	Change in discount compared to Sep’15 tender (%)	Discount (₵/kWh)
1	Independent retailer C	27	10	5.5
2	Existing generation company and retailer F	26.01	13	5.3
3	Independent retailer A	20.88	-1.12	4.2
4	Existing generation company and retailer E	20.2	6.1	4.1
5	Existing generation company and retailer D	20.1	5.6	4.1
6	Existing generation company and retailer H	19	14	3.9
7	Independent retailer B	16.88	-1.12	3.4
8	Existing generation company and retailer I	15	10.05	3.1
9	Existing generation company and retailer G	8.5	0	1.7
10	Existing generation company and retailer J	5.5	2.3	1.1

More choices and flexibility

The Open Electricity Market is an initiative that allows electricity consumers to buy electricity from a retailer at a price plan that best suits their needs. This means consumers get to benefit from competitive pricing and innovative offers from the retailers.

Visit www.openelectricitymarket.sg to find out more about this initiative.

With effect from 1 April 2020, the MDSC is 0.3771 cents/kWh of electricity consumed. It is set based on the cost of supporting various market development initiatives, such as the Electricity Futures Market and the Open Electricity Market. The MDSC forms part of the Market Support Service charges.

As the MDSC is a usage-based charge, the amount paid by consumers will depend on their individual amount of electricity consumed.

The MDSC forms part of the existing Market Support Services fee that is set in the quarterly electricity tariff review.

The MDSC forms part of the existing Market Support Services fee that SP Group bills to the retailers. In some cases, the MDSC could be absorbed by your electricity retailer depending on the terms and conditions of your contract. Please contact your retailer to find out more information.