electricity generation is a complex business...
you have to match supply and demand 24/7.....
If you have been to Oslo, 1 thing that strike me is ALL the office buildings are brightly lighted up; including inside the offices with no one working.
To me it was like a bloody waste of energy...
but i was told there was a min gen capacity and the power has to be consumed somehow....
From the reply of EMA below,it is very clear how EMA BS and tried to con.
10 October 2008, The Straits Times
Billing consumers isn't the only way
THE recent hike in electricity tariff of 21 per cent has resulted in an increase of 48 per cent in 12 months. Singapore becomes the country with the highest electricity prices in the region and charges its consumers more than countries like the United States and France.
The increase is being justified based on the fact that the electricity price index is being linked to the oil price index. The last increase has been based on oil price futures bought at around US$150 (S$220) a barrel. Oil spot prices are now below US$90 a barrel (40 per cent).
Eighty per cent of Singapore's electricity is being produced from natural gas (and not oil) piped in from Malaysia and Indonesia. I assume long-term gas contracts have been negotiated at decent prices protecting the end consumer in Singapore. Why not link electricity pricing to oil futures and not to long-term gas contracts?
Energy production and distribution is a highly regulated environment operating as a monopoly. Regulators have to create a mechanism which gives citizens adequate protection against worldwide oil and gas speculation followed by irrational price hikes. They are not doing enough by simply passing the bill to the consumers.
A combination of economic downturn, high inflation and skyrocketing energy prices may prove too much to swallow for the lower income class. Regulators, producers and distributors have a duty to protect the nation from one of its greatest challenges: Energy dependence. Therefore, we cannot continue to import and burn gas, oil and coal, or depend on others. A master plan to produce energy from sun, water, wind and nuclear power is crucial in safeguarding the nation's independent energy future.
The current subsidies will only have a short-lived effect and will have almost no effect on the reduction of our national energy bill.I am suggesting a combination of tax incentives, rebates and subsidies for households buying energy-saving appliances or making their houses more energy-friendly. It would encourage many of us to replace our energy-hungry washing machines and air-conditioners with other 'green, energy-friendly-certified' appliances.
Landed properties could be turned into energy-producing entities instead of energy consumers. HDB should set the example (even if the monetary side of the investment is not that attractive) to go for highly efficient energy housing. A double impact could be achieved by implementing a consumer pricing, penalising high consumption, but rewarding low-consumption energy savers. Many of our neighbours have already implemented such schemes.
Bruno Serrien
Reply From EMA
IN HIS letter last Friday, 'Billing consumers isn't the only way', Mr Bruno Serrien noted that the electricity tariff has increased by 48 per cent in the past 12 months. But this must be seen in the context of the rising fuel oil price, which has more than doubled during this period.
As Singapore imports all its fuel, we have pegged the tariff to the cost of the fuel, so electricity is priced properly and wasteful consumption is minimised. The increase in the tariff this quarter was necessary because of the 38 per cent spike in the forward fuel oil price from US$83 to US$115 per barrel between April and July this year.
Mr Serrien's claim that Singapore has the 'highest electricity price in the region and charges... more than countries like the US or France' is inaccurate and fails to account for differences in the availability of indigenous fuel and pricing policies across countries. For example, France generates 80 per cent of its electricity from nuclear energy, which is unaffected by the high oil price. On the other hand, Japan relies heavily on imported oil and gas, and charges a higher electricity price than Singapore. Within the US itself, there is a wide variation across the states and some have electricity prices which are comparable to or higher than the rate in Singapore.
Mr Serrien also suggested that Singapore should move towards energy independence. But as a small country, Singapore has limited alternatives to fossil fuels. Hydro, geothermal and wind power are not available here. Nuclear energy raises issues such as safety and disposal of nuclear waste which have to be managed. Solar power has some potential, but realistically this cannot replace more than a small proportion of our energy needs. Solar is also more expensive than electricity generated from natural gas, although the technology is still improving and costs are gradually coming down.
We agree with Mr Serrien that regulators should create mechanisms to protect consumers instead of simply 'passing the bill' to them. This is why the Energy Market Authority has focused on restructuring and liberalising the electricity market, to drive efficiency gains and ensure competitive pricing of electricity. The Government has also set up the Energy Efficiency Programme Office to design and implement energy efficiency programmes across different sectors. Going forward, we will continue to do our part to help households conserve energy and save on their electricity bills.
More EMA's replies to letters in the media:
Put the brakes on electricity price hikes
31 December 2009, My Paper
Tariff increase might lead to repercussions
9 October 2009
Choice of electricity retailers
1 October 2009
Tariff-calculation formula online
29 December 2008, My Paper
Power tariff formula reviewed every 2 years
17 December 2008, TODAY
Doing the power math
10 December 2008, TODAY
Gencos don't make 'extraordinary profits'
9 December 2008, The Straits Times
Energy bill formula still being tweaked
13 November 2008, TODAY
Why HK pays a different price
30 October 2008, TODAY
Fairer comparisons - Japan and Ireland
27 October 2008, The Straits Times
Tariff Revision no benefit to power generation companies
20 October 2008, TODAY
Lower distribution cost moderated tariff increase
16 October 2008, Lianhe Zaobao
Why electricity price hike was needed
10 October 2008, The Straits Times
Lower Electricity Tariff if Price of Oil Continues to Fall
7 October 2008, My Paper
Price electricity properly and give focused help
7 October 2008, My Paper
Towards a more liberal electric mart
7 October 2008, My Paper
Quarterly tariff update accounts for time lag
2 October 2008, My Paper
Higher electricity prices will not adversely affect lower-income families
1 October 2008, Lianhe Zaobao
EMA explains spike
1 October 2008, The Straits Times