Question

Mr Low Wu Yang Andre: To ask the Deputy Prime Minister and Minister for Trade and Industry (a) to what extent has Singapore’s dependency on the volatile global natural gas market contributed to the recent electricity tariff hike for consumers; and (b) what is the Ministry’s assessment of the potential long-term impact of stabilising household electricity prices from an accelerated transition to renewable energy sources.

Written Answer by Deputy Prime Minister and Minister for Trade and Industry Gan Kim Yong

1. The regulated electricity tariff in the fourth quarter of 2025 increased slightly by 0.3% from the preceding quarter. As a small country, Singapore is a price-taker for energy and more than 95% of our energy needs are currently met by imported natural gas. Hence, changes in the tariff generally reflects movements in imported fuel costs which constitute the largest component of the tariff. Electricity tariffs have been on a general downtrend, decreasing by about 9% since prices peaked in the third quarter of 2022.

2. Increasing the share of renewable energy in our energy mix may reduce our exposure to movements in fuel cost. We will continue to deploy renewable energy domestically wherever possible, particularly solar energy which is the most cost-effective type of renewable energy available in Singapore today. As of the first quarter of 2025, we have deployed 1.64 gigawatt-peak (GWp) of domestic solar, surpassing our 2025 target of 1.5 GWp. While we will continue to press on with solar deployment, Singapore is alternative energy-disadvantaged owing to our small size. This limits our domestic deployment of renewable energy. Hence, natural gas will remain a major part of our fuel mix while we continue to explore other low-carbon energy sources.

3. The overall impact of transitioning to low-carbon energy sources on electricity prices remains uncertain at this juncture. It will depend on which low-carbon energy sources we introduce into our energy mix, as well as when we do so.