Inflation, Investing and Everything
This article belongs to the Singapore inflation watch story arc.
Singaporeans will see an increase of 21% in their electricity bills in the last quarter of this year. For the quarter 1 Oct to 31 Dec 08, the average electricity tariffs will be increased by 5.38 cents per kWh. This represents an increase of 21.46% for households. The increase is due to higher fuel oil prices. For the period 1 Oct to 31 Dec 08, tariffs are pegged to a higher forward fuel oil price of S$155.14 per barrel, which is 38.06% higher than that of S$112.35 per barrel for the current quarter [Q3 2008].
The EMA feels there is more room for Singaporeans to conserve and use less energy. The EMA's surveys and findings show that nearly 40% of Singapore homes are using more energy than they require to. And the air conditioner is one of the largest energy guzzlers in homes here.
- For residential households in Singapore, the electricity rate will increase from 25.07 to 30.45 cents per kilowatt-hour. Quarter-on-quarter that's a 21.46% increase as stated, but if you were to look back a bit further, it's a mind-blowing 89.6% increase compared to 3 years ago, as the tariffs back in Apr 2005 was 16.06 cents per KWh. This is a super-high double-digit rate of inflation, and all we need is for another further one or two rounds of increase to hit a triple-digit rate within a 3-year period. Absolutely super.
The surprise here is that while NYMEX crude oil prices have been driven downward in recent weeks by the ongoing financial market meltdown, the oil price used for electricity rate calculations isn't the historical NYMEX crude oil movements but forward fuel prices for the upcoming quarter, which are, after conversion to USD, around $110 per barrel.
As for conservation measures, they will help somewhat but only up to a point. If the rates were to double, could you cut back to use half the electricity? If they were to triple? Quadruple? Would you be able to cut back 66%? 75%? The price upside is effectively unlimited, while your downside mitigation measures will naturally start to run into limits.
But of course that isn't to say that we shouldn't try. In view of our own pocketbook, resource depletion and environment pollution, we should still strive towards energy conservation as much as we can. As I have chronicled earlier, we have reduced our household power consumption from a whopping 700 KWh per month down to a much more manageable 436 KWh (average over past 3 months). That's a reduction of 37.7% - not too bad, eh?
Here are some of the things we did in terms of energy conservation over the past couple years or so :
- configured the computers to auto-shutdown after the nightly backups
That seems like a long list of things to do and some of them cost money too. Of course all the LCD's cost money, but we had actually been hanging on to CRT's long after everyone and their grandmother had already upgraded, so there you are. Further improvements would be more incremental tweaks - perhaps I may permanently turn off the second cordless phone which is only occasionally used, replace the very last 19" CRT TV in one of the bedrooms, also occasionally used, sending the children's bathtub to the recycling bin to save on some heated water since they are too big for it anyway, things like that. We'll see how this goes.
See also :
1. Singapore : electricity tariffs to increase April 2008 on rising oil prices
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