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Why electricity bills increase when natural gas prices drop, ST forum writer boldly asks source: https://mothership.sg/2020/01/electricity-bills-natural-gas-price-singapore/ A Straits Times forum letter writer has boldly asked a pertinent consumer interest question that many have thought about, but did not act upon. In a forum letter published on Jan. 1, 2020, the writer, Alan Chiu Chen Hong, publicly questioned how could it be possible that electricity tariffs will rise on average about 3.5 percent in the first three months of 2020, when gas prices has been decreasing. Such an increase in tariffs would translate to a rise of S$3.20, from S$92.75 to S$95.95, for a family in a five-room HDB flat. Cheaper gas used to generate electricity, right? The inability to logically parse this relationship between tariffs and gas stemmed from the news that electricity bills will rise and gas prices will fall in tandem. It was first reported in ST on Dec. 31, 2019, in an article titled, “Electricity bills to go up, and gas prices to fall”. But there was no clear explanation provided by the authorities for this phenomenon. The letter writer then elucidated this link. An inverse relationship between gas prices and bills? Citing the Energy Market Authority Singapore, the letter writer wrote that about 95 percent of Singapore’s electricity is currently generated using natural gas. This is a significant increase in utilising natural gas to meet Singapore’s power generation needs. Previously in 2001, natural gas was used to produce just 26 percent of Singapore’s electricity, as oil was the preferred fuel. Chiu then wrote: “Therefore, I am surprised by the tariff increase because the natural gas price has been very weak, and has dropped significantly in the past year.” He continued: “Last year, the natural gas price was about 16 to 20 percent lower than in end-2014.” And it appears the letter writer is on to something. What determines tariffs? ST reported in its original article that the cost of fuel determines the tariff. ST wrote: “A key determinant of the tariff is the cost of fuel and power generation.” ST also quoted Professor Subodh Mhaisalkar, executive director of the Energy Research Institute at Nanyang Technological University. Subodh said the cost of electricity generation typically makes up 75 percent of the tariff, and as energy costs go up, it is natural for the costs to be passed on to customers. He added: “The tariff hike would be directly correlated to global energy prices, plus supply and demand pressures.” But the observable trend has been that natural gas prices have been going down. What did the authorities say? ST did try to get an answer from the authorities, but it appeared it wasn’t the clearest of responses. Asked why electricity prices are rising and gas prices falling, an EMA spokesman said: “The difference between the electricity and town gas tariffs is mainly due to the different fuel types used and their prices moving in different directions.” But now that the issue has been aired in the open, a fuller response from the authorities looks likely. Keep your eyes peeled.

Singapore will continue to rely on natural gas for the next 50 years: Chan Chun Sing Source: https://www.straitstimes.com/singapore/environment/singapore-will-continue-to-rely-on-natural-gas-for-the-next-50-years-chan-chun Minister for Trade and Industry Chan Chun Sing speaks during the opening of the Singapore International Energy Week at Sands Expo and Convention Centre on Oct 29, 2019.ST PHOTO: KEVIN LIM SINGAPORE - Solar energy would by 2030 make up a greater share of Singapore's energy mix, but natural gas, a fossil fuel, would still be the Republic's dominant fuel in the near future, Minister for Trade and Industry Chan Chun Sing said on Tuesday (Oct 29). Singapore has limited access to renewable energy options such as geothermal or wind power, Mr Chan said during the opening session of Singapore International Energy Week. But the Republic will scale up its efforts to harness sunshine, the one thing that is plentiful on the island, with a new target of increasing installed solar capacity by more than seven times from current levels to reach 2 gigawatt-peak by 2030. Yet, harnessing solar power will not come without challenges, including cost, urban shading and the intermittency of sunshine due to cloud cover, for example. Said Mr Chan: "We will continue to rely on natural gas for the next 50 years for a substantial part of our energy needs." More than 95 per cent of Singapore's energy now comes from natural gas, which it imports in liquefied forms from all over the world and through pipes from neighbouring Indonesia and Malaysia. Singapore is moving towards a future of cleaner, affordable and reliable energy, Mr Chan said. The city-state began this journey in the early 2000s , as it transitioned away from oil to natural gas, he said. Now, it will look to ramping up solar, and making its natural gas plants more efficient. In the longer term, Singapore could be plugged into a regional power grid to trade electricity with its neighbours, which would increase its energy security, even as the Republic invests in research and development in other low-carbon technologies that, unlike solar energy, had yet to become commercially viable. Natural gas is the cleanest fossil fuel. It emits 50 to 60 percent less carbon dioxide when burnt in a new, efficient natural gas power plant compared with emissions from a typical new coal plant, according to the United States Union of Concerned Scientists. When compared with diesel, natural gas produces about 30 per cent less carbon dioxide emissions, figures from the US Energy Information Administration show. But if natural gas, which largely comprises methane, leaks before it is burnt, there could be repercussions on global climate. This is because methane is a more potent greenhouse gas compared with carbon dioxide. The latest assessment report by the Intergovernmental Panel on Climate Change said methane is 28 times more efficient than carbon dioxide at trapping heat on the planet. Methane contributed just 0.39 per cent of Singapore's emissions in 2014, said a report Singapore submitted to the United Nations Framework Convention on Climate Change last December. The authorities are taking measures to reduce the chance of such leaks, and to boost the reliability of the gas network. The Energy Market Authority (EMA) said conventional leak detection methods require intensive human involvement without automation and also rely heavily on customer reports on gas service problems, instead of direct detections. EMA had previously funded a project to identify and detect anomalies in the gas pipeline network via a system involving a variety sensors and a computer algorithm. Vigti is a spin-off from the project which was successfully completed early this year and there are plans to scale this up further, said EMA. Separately, in response to queries on Singapore's only coal-fired plant on Jurong Island, an EMA spokesman said the use of coal is carefully managed. The facilities on Jurong Island use a variety of fuel, she said, and the Tuas Tembusu Multi-Utilities Complex was set up to provide utilities such as steam and electricity to chemical companies on Jurong Island. The EMA spokesman added that the greenhouse gas emissions from the complex is similar to that of existing fuel oil plants in Singapore's system today, as the complex uses "a mix of clean coal and biomass to produce steam and electricity". Asked on future plans for the coal plant, she said Singapore would continue to improve the technology or retro-fit certain parts of gas-fired plants to improve efficiency and produce much cleaner energy. "We are working on adopting more solar energy, importing from the regional grid, and exploring emerging low-carbon technologies," she added.