The utilities provider reviews the electricity tariffs every quarter based on guidelines set by the Energy Market Authority (EMA).
The electricity tariff consists of four components – energy costs paid to the generation companies, network costs and market support services fees paid to SP Group, as well as market administration and power system operation fees paid to the energy market company and power system operator.
The energy costs component is adjusted quarterly to reflect the changes in the cost of fuel and power generation. The fuel cost is the cost of imported natural gas, which is tied to oil prices by commercial contracts.
The cost of power generation covers mainly the costs of operating the power stations, such as the manpower and maintenance costs, as well as the capital cost of the stations.
INCREASE IN GAS TARIFF
The gas tariff for households will also increase for the Jul 1 to Sep 30 period.
It will go up by 0.23 cent per kWh, from 21.68 cents per KWh to 21.91 cents per kWh before GST, City Gas said on Friday.
The increase is due to higher fuel costs compared with the previous quarter, City Gas added.
City Gas reviews the gas tariffs based on guidelines set by EMA, which regulates the gas industry.