What to look out for when choosing an Electricity Retailer in Singapore
Choosing an electricity retailer has become a popular topic in the recent months. Now that it is fully launched nationwide, consumers have the free will to decide to continue to buy their electricity supply from SP Group, or to switch to one of the available electricity retailers in Singapore.
Before you switch, here are 5 things to consider:
1. Electricity Consumption Pattern
According to a quote from the Art of War by Sun Tzu,
If you know your enemy and know yourself, you will not be imperilled in a hundred battles.
That being said, here is how we will apply it to the open electricity market. There are a number of non-standard price plans that charge an electricity rate according to the household’s usage pattern.
Electricity Rate from 7am to 7pm: 20 cents/kWh
Electricity Rate from 7pm to 7am: 15 cents/kWh
In this scenario, there exists a possibility of paying a cheaper electricity rate if you are using the most amount of electricity from 7pm to 7am. Of course, there will always be some electronics that are permanently switched on, e.g. a refrigerator.
Flat Rate of $80 per month, up to a consumption threshold of 450 kWh per month. Thereafter, a separate rate for every kWh exceeded.
In this example, so long as your monthly consumption do not exceed the threshold, the bill will more or less be the same. Accordingly, the mathematics worked out to be approximately 17.78 cents/kWh for the first 450 kWh of electricity every month. This is a competitive rate as compared to the rate found on the standard fixed price plans (without the threshold). 🤔
2. Standard Fixed Price vs Standard Discount off the Regulated Tariff plans
If you are unsure on your electricity usage pattern, then consider the blanket options- Standard Fixed Price plans, or Standard Discount off the Regulated Tariff plans.
At this point, if you are unsure on how each plan works, I will highly recommend you to check out my earlier post on Open Electricity Market in Singapore. In that post, I explained in great detail on the fundamentals of both plans, as well as the consequence should the electricity tariff continue to rise (or fall).
In brief, for the standard fixed price plans, we will pay a fixed electricity rate throughout the entire contract duration, e.g. 18 cents/kWh for 12 months. As for the discount off the regulated tariff plans, we will pay a fixed discount off the regulated tariff for the quarter over the contract duration.
3. Fees and Charges
Once you have decided on the type of plan, take a closer look at the fact sheet as well as on the contractual terms provided by the electricity retailer. In general, these are some of the fees and charges to take into account:
Early Termination: A flat fee or a formulated rate may be imposed if we choose to terminate the plan early.
Security Deposit: A deposit may be required.
Service Fee: A monthly fee may be charged throughout the contract duration.
Transmission Loss Factor: Some of the plans charge a fee for this.
Payment Rejection: A fee may be charged for an unsuccessful payment via GIRO, debit or credit card.
Late Payment: Either a flat fee or a percentage of the outstanding bill amount.
Changes to Contract: If we change your mind, we may be charged a fee.
Paper Bill: Some plans only provide e-bill while others charge a fee for paper bill. Furthermore, some plans charge a fee if we request for an old bill or to reprint one.
4. Contract Duration & Renewal Terms
I like to plan ahead and be confident about my future. If you are the same, have a second look on the length of the contract and its renewal terms. Then decide on how long you are going to commit, e.g. 6 months or 24 months. Thereafter, it is worth knowing if the renewal terms will be the same or better than the prevailing regulated tariff.
This is because in some cases (especially for the non-standard plans), the renewal terms are significantly different from the initial contract terms. Hence, please take note. ⚠️
5. Additional Perks
Who doesn’t like additional perks? Well, me (kind of).
Additional rebates and perks are one of the last few things that I look at before I make any purchase. This is because there must be a real need before I start to look for a solution. Thereupon, the final solution must make sense and fits into my profile. In any case, here are some of the perks offered by the electricity retailers:
Additional Bill Rebate: A one-time bill rebate may be given after you continue with the plan for a certain period of time.
Credit Card Promotion: A one-time bill rebate or an additional discount may be given if you charge the electricity bill to a specific credit card on a recurring basis. However, do note that you may be required to fulfil a certain requirement from the credit card in order to receive some of the cash back, e.g. a minimum spending.
Hence, such cash back is actually independent of the electricity bill. In other words, you can spend the same amount of money on other items and still receive the same cash back.
Referral Programme: Some plans include a one-time new sign-up bill rebate for either or both the referrer and the referee.
Free Gifts: Some plans come with free insurance coverage for a fixed period of time while others offer a very old generation of iPad amongst other gifts.
All things considered, these are 5 things to look out for when choosing an electricity retailer in Singapore. At the end of the day, take your time and understand what you are getting into before you commit.
Meanwhile, do check out my previous post on how to choose an open electricity market retailer in Singapore. In that post, I shared my thought process on my final choice through 4 rounds of elimination. Until next time!
Find out why I signed a two years contract with Ohm Energy: Ohm Energy Review: I am Impressed!
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Share Your Thoughts 💭
1️⃣ Have you switched to one of the available open electricity market retailers?
2️⃣ What are your considerations for doing so / avoiding the switch?
3️⃣ Is there any mistakes that you have made when making the switch?
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