Singapore residents were slapped with a 15 per cent hike in water prices and a 6.9 per cent average increase in electricity tariffs – both these price increases went into effect together, on Sunday. The water price hike was the second of two phases in which water prices were hiked by a total of 30 per cent from what is was in 2016.
What many don’t realise is that the 6.9 per cent is the third such increase Government-linked SP Group has imposed in the first seven months of this year alone.
This latest tariffs hike comes after SP Group imposed a 2.8 per cent hike from April 2018 that followed a 6.3 per cent average tariffs increase from January 2018. The 6.3 per cent average increase in January this year made total electricity tariffs the highest that have been imposed which since 2015.
Earlier this year, SP Group explained that the electricity tariffs increase in April will be implemented mainly due to the higher energy cost of producing electricity. In December last year, the group gave a similar reason to explain the tariffs hike between Jan-Mar 2018 when it said that the increase was due to the higher cost of natural gas for electricity generation.
Between April to June 2017, SP Group hiked electricity tariffs by an average of 6.1 percent compared to the previous quarter.
In the next quarter, July to September 2017, tariffs decreased by an average of 3.2 per cent and in the final quarter of 2017, tariffs went down by an average of 2.1 per cent. SP Group pointed to a lower cost of natural gas for electricity generation and lower non-fuel costs.
Despite these reductions, tariffs have increased by a sizeable 16.8 per cent in a span of just one year.
News of the electricity tariffs hikes over the past year come as Singaporeans expect the Goods and Services Tax (GST) to rise by 2 per cent in the next few years, following the Government’s confirmation that a GST hike will be rolled out in the coming years.
Meanwhile, SP Group – which is wholly owned by sovereign wealth fund Temasek Holdings – made a net profit of $948.8 million after tax in the last financial year, ending 31 Mar 2017: