Gas Processing & LNG is Produced by Gulf Publishing Holdings LLC



Singapore electricity providers hit by global power crunch quit market

Two energy providers in Singapore, including one of the largest independent electricity retailers, are exiting the market and according to company sources at least three others have stopped accepting new clients amid rocketing wholesale energy prices.

iSwitch Energy, one of Singapore's largest independent electricity retailers, said on its website that it will be ceasing electricity retail operations on Nov. 11, due to "current electricity market conditions". The company declined to comment further.

SilverCloud Energy, which supplies power to commercial, industrial and residential buildings, told Reuters it will also exit the market soon and is notifying customers to switch to other providers or transfer back to state-owned SP Group.

Global wholesale gas prices have surged in recent months as production and transit problems have lowered supply just as demand took off in a post-pandemic economic recovery.

Asian spot LNG prices <LNG-AS> have risen by more than 500% from a year ago to over $30 per million British thermal units (mmBtu) this month while Brent crude oil prices, the basis for pricing most of Singapore's long-term gas contracts, rose to multi-year highs.

Company sources told Reuters that Diamond Electric, Best Electricity Supply and Ohm Energy had stopped accepting new customers, with Diamond Electric in the process of handing over existing term contracts to another utility provider. The three firms did not respond to an emailed request for comment.

"Not only are retailers unable to sell to retail customers at a level that is economic because the set quarterly tariff implies a price that is well below where futures are trading, they are also getting hit on the front-end because spot prices have gone ballistic," said James Whistler, global head of energy at Simpson Spence Young.

"Add the failure of the once well-designed market-making scheme and things become untenable for many."

Open Electricity Market, a website that lets Singapore residents choose an energy supplier, shows only 8 out of the 12 existing retailers offering plans for consumers.

With the spike in energy prices, "several Singapore retailers are now potentially closing their doors," said a senior industry participant who declined to be identified due to the sensitivity of the matter.

Singapore's retail electricity market opened to competition for business consumers in 2001 and to residential households in 2018, according to the Energy Market Authority (EMA) website.

EMA did not reply to a request for comment.

Surging gas prices, which rose to record highs in Europe and in Asia this month, have also hit utility providers in Britain, where a number of energy companies have collapsed, forcing about 1.7 million customers so far to switch providers.

China and India are being hit with power shortages and blackouts.

In Singapore, electricity tariffs are calculated using fuel costs and non-fuel costs.

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 while the non fuel-cost is calculated based on the cost of generating and delivering electricity to homes.

Singapore LNG Corp is currently scouting for LNG cargoes and exploring options to increase inventory of LNG at its terminal, given the tight global LNG supply.

Commercial load power prices have risen by 50% from last year and are set to go higher, Whistler said.

"This is a pretty big difference for a country that has been relatively used to reasonably priced power now moving into a less competitive market and essentially being subject to global commodities prices as well."

Reporting by: Roslan Khasawneh and Jessica Jaganathan Editing by Elaine Hardcastle and Peter Graff


Copyright © 2019. All market data is provided by Barchart Solutions. Futures: at least a 10 minute delay. Information is provided 'as is' and solely for informational purposes, not for trading purposes or advice. To see all exchange delays and terms of use, please see disclaimer.

                                  CMEGroup                                     Icelogo

FEATURED COLUMNS

Editorial Comment
-Adrienne Blume
The editors of <i>Hydrocarbon Processing</i>, sister publication to Gas Processing & LNG, will release their “HPI Market Data 2022” annual forecast report in October.
Industry Focus: Sensor advances allow pipeline leak detection to take to the skies
-Doug Baer
Sustainability and green initiatives have always been laudable objectives, with mission statements around the world confirming commitments to lower emissions and energy consumption, and increase recyclability, to name a few.
Maintenance and Reliability: Prevent unplanned shutdowns for LNG liquefaction facilities
-Peter Zhang
Although an unplanned shutdown is an integrated part of the operational and safety management system of an operating plant, unplanned shutdowns for a modern LNG liquefaction operating facility often become some of the costliest events for the facility owner.
Regional Focus: Balancing Africa’s world-class LNG projects and the environment
-Shem Oirere
The construction of world-scale natural gas processing plants by three of Africa’s top natural gas producers has attracted scrutiny, despite efforts to commercialize the continent’s hydrocarbon resources and expand energy supply on the continent.


Throughput optimization for pipelines and gas plants

Register Now

Many processes within oil and gas pipelines and processing plants depend on maintaining specific temperatures and pressures at which the process fluids are liquids or gases. In addition, anytime water is a component in the process fluid hydrates can form and plug piping and vessels. Learn how Sensia’s Throughput optimization solution allows operators, and control systems to “see inside” the process in real time to understand where the facility is operating with respect to critical physical constants, including the phase envelope and hydrate temperature. This insight allows for more stable operation, reduced energy expenditure and associated emissions, and greater facility throughput. Case studies will include controlling methanol injection, managing heaters, virtual sensors for sulfur recovery units and more.

April 1, 2021 10:00 AM CDT

Register Now

 

Please read our Term and Conditions, Cookies Policy, and Privacy Policy before using the site. All material subject to strictly enforced copyright laws.
© 2021 Gulf Publishing Holdings LLC.