Criteria Used in Assessing Electricity Retailer's Application to Pass on Additional Costs to Consumers

Mr Louis Ng Kok Kwang asked the Minister for Trade and Industry what set of criteria does EMA use when assessing an electricity retailer's application to pass on additional costs, arising from the carbon tax, to consumers.

Retailers offer two main types of plans to households. For standard price plans (SPPs), retailers are not allowed to change the electricity rates midway through their contracts. For non-SPPs, retailers can include contract clauses that allow them to change the electricity rates at specific points in time through the contract, for various cost changes and other reasons. The clauses must clearly specify the exact dates, reasons and formula/ quantum of the rate changes upfront at the point of contract signing. When rates are changed, the onus is on the retailers to ensure that they are reasonable and in compliance with the clauses.

The Energy Market Authority (EMA) will not hesitate to investigate and take actions against any retailer which has imposed unreasonable prices on consumers or engaged in unfair contracting practices.