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Written reply to PQ on Open Electricity Market

Written reply to PQ on Open Electricity Market

Question

Ms Rahayu Mahzam: To ask the Minister for Trade and Industry (a) since the introduction of the Open Electricity Market in Jurong, what is the total number of residents who have made a switch to purchase their electricity from a retailer of their choice; (b) whether there is a poll or study done to gauge the level of awareness level of the new electricity retail options and, if so, what is the outcome; (c) whether there is a poll or study done to gauge the satisfaction level of customers who have switched to purchasing their electricity from a retailer and, if so, what is the outcome; and (d) whether there were any issues raised by residents who have switched to purchasing electricity from various retailers.

 

Written reply:


1.             The Energy Market Authority (EMA) introduced the Open Electricity Market (OEM) in Jurong in April 2018, providing around 120,000 households and small businesses with the choice to buy electricity from a retailer with a price plan that best meets their needs. This soft launch was well-received. As of mid-September 2018, more than 30% of Jurong households have switched to a retailer.

2.              To better understand the public’s reception towards the OEM soft launch, EMA conducted a survey involving the Jurong residents about three months after the soft launch started. The survey results showed that the Jurong residents generally felt positive about the OEM, with very high awareness of the OEM and their electricity purchase options. About 9 in 10 of the survey respondents indicated that they were aware of the OEM and the electricity purchase options available to them. Of those who had switched to a retailer, about 8 in 10 appreciated the benefits of the OEM and indicated that they found the switching process easy.

3.             A small number of residents highlighted that they experienced higher electricity bills after switching to a retailer. There are a few possible explanations:

a.    SP Group reads electricity meters once every two months. On alternate months when the meters are not read, the consumer’s bill is based on estimated consumption. Any underestimated readings will be carried over to the next bill, which would make the next bill higher.

b.    Depending on when a consumer switched, his first bill may not cover a full month. The following month’s bill will be relatively higher as it will cover a full month of electricity consumption.

c.     Another possible reason for higher electricity bills is that electricity usage could be higher during certain periods of the year (e.g. school holidays or hotter months of the year).

4.             With the zonal rollout of OEM starting from 1 November 2018, EMA will continue to ensure that the necessary safeguards are in place to protect consumers. EMA will also continue to work closely with SP Group and the retailers to inform and educate consumers about the OEM.

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