A Guide To The Open Electricity Market Plan For Your Home

Here’s the ABCs of OEM to suit you and your family’s needs

Updated on March 19, 2019 10:03 am

Cromly Editor

A Guide To The Open Electricity Market Plan For Your Home

For a progressive country just like Singapore, reliable electricity supply is critical to its economic development. Over the years, Singapore’s energy sector has been continuously liberalised and restructured.

One of the most notable changes is the launch of the Open Electricity Market (OEM), where about 1.4 million Singapore households have now the power to choose where to purchase electricity from. With its rollout, consumers now have more choice and flexibility while enjoying the same supply through the national power grid.

Still confused on how this works? Here are the things you need to know about OEM before making the big switch:

What is OEM?

In Singapore, electricity retailers purchase electricity from power generation companies and sell them to households. Energy Market Authority (EMA) works as the power system operator that monitors and ensures the security of the electricity generation and transmission system, while retailer, SP Group, owns, and operates both the transmission network and distribution network.

With OEM, instead of getting power solely from SP Group, households will now be allowed to pick and choose from the price plans offered by approved retailers that best meet their needs.

Source

Who are the other electricity retailers?

Here are some of the electricity retailers that you’ll be able to buy their electricity from:

What will I get from OEM?

OEM offers a lot of benefits to the homeowner. These include the following:

  • Customers will have access to more electricity plans.

Compared to paying a fixed, quarterly tariff rate that SP Group offers, OEM allows consumers to choose from two types of electricity plans: Discount Off Regulated Tariff plans and Fixed Price plans. These plans give Singaporean households choices on how they opt to buy electricity and who they wish to buy it from. With this flexibility, households can choose a plan that suits their needs and lifestyle best based on their consumption habits.

  • Competition means a better quality of service.

By opening the market to other industry players, companies will now strive to provide great service at great prices to their customers. Beyond the price, companies are also striving to differentiate themselves by competing to value-add to households and provide even more offerings and perks.

  • Wiser households with regard to energy consumption.

By being more conscious about the frequency of electricity usage, how much power your appliances are using, and areas of wastage, you will know which plan and service provider is best for you. Aside from that, this will lead to a more wise household in terms of electricity use, saving both money and natural resources over time.

What are the types of price plans offered by OEM retailers?

It is important for Singaporean households to understand the types of price plans offered by OEM retailers and how each works.

In general, there are two types of plans: Discount Off Regulated Tariff and Fixed Price.

  • Discount Off Regulated Tariff plans offer a discount on the prevailing regulated tariff price revised every quarter; while,
  • Fixed Price plans mean you pay a fixed rate throughout the duration of your contract. However, while the rate is not subjected to quarterly fluctuations based on the tariff, it may go higher or lower than the tariff over time.

What to consider in choosing the best OEM retailer for you?

There are various retailers and plan offerings that you can choose. But, in selecting the best OEM retailer and price plan for your home, you have to consider first the following:

  • Your household electricity bill

Before you dive into the OEM retailers, the first thing you need to do is examine your electricity bills. This will help you have a more accurate view of your consumption patterns. Note the highest electricity usage in a month and then calculate the average monthly electricity consumed.

  • The expected costs

To help you with your OEM decision, you can calculate the expected costs by referring to the information on historical tariff rates and compare it against the rates that the electricity retailer offers.

For Fixed Price plan, you can use the formula below:

  • Expected Fixed Rate Bill = Electricity Consumed x Fixed Rate Cost (per kWh)

For Discount Off Regulated Tariff plan, look at what you are currently paying for your electricity (which is at the regulated tariff) and factor in the discount percentage given in the plan with the formula below:

  • Expected Discount Off Tariff Bill = Electricity Bill – (Electricity Bill x Discount Off Tariff Percentage)

The Contracts

If you still can’t make a decision, you can visit the retailer’s website and download the fact sheet for the plan you have already considered. The fine print will summarise for you the terms and conditions of the plan you’re choosing, including the contract duration, payment terms, security deposit, early termination charges, and auto-renewal clauses.

Another fine print you need to read is the Consumer Advisory, which includes the important things you should know before signing the contract. There are things you should know about the plan you’re getting and it is important to ask questions if there are terms and conditions that confuse you.

Discounts and promos

To get new customers, retailers offer discounts and promotions. Before you sign up, you should know if these are limited-time and quantity offers and should not be the main reasons why you opted for that retailer. In the end, what matters most in choosing your electricity retailer and plan should be what suits you best and your family’s needs, and not because of the perks that the service provider offers.

For more information about OEM, visit the Open Electricity Market website.

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