Impact of Recent Heatwave on Electricity Consumption in Residential and Commercial Premises

Mr Murali Pillai asked the Minister for Trade and Industry (a) whether the recent heatwave in Singapore has contributed to a spike in electrical consumption in both residential and commercial premises; (b) if so, what is the net increase in usage in terms of percentage and cost; and (c) what steps will be taken to ensure that Singapore's power grid will continue to have capacity to deal with the expected higher demand owing to climatic conditions in the future.

Electricity consumption tends to be higher during the typically hotter months of April, May and June. This year, peak electricity demand increased by about 8% from 7.3 gigawatts in February to 7.9 gigawatts in May. The impact on electricity costs for different consumers and businesses depends largely on usage patterns and the price plans that they are on.

I wish to assure the House that there is sufficient generation and grid capacity to meet the increased electricity demand arising from higher temperatures. The existing installed capacity of Combined Cycle Gas Turbines used for power generation is 9.4 gigawatts, comfortably higher than the peak electricity demand of 7.9 gigawatts experienced in May.

In addition, changes in climatic conditions are taken into consideration when the Energy Market Authority (EMA) updates its annual electricity demand forecasts. EMA uses these forecasts to plan for investments in electricity infrastructure.

First, the forecast helps guide generation capacity investments. EMA announced last October that it would introduce a centralised tender approach in 2023 to facilitate and guide private investments in new generation capacity. The tender will be conducted in advance, before the new capacity is needed, taking into account the lead time required for construction and development. Should there be inadequate interest from the private sector to plant new capacity, EMA will build the required new capacity. This is to ensure that there is sufficient generation capacity to meet forecasted electricity demand.

Second, the forecast also guides SP Group's investments in the upgrading of our power grid network, to meet projected electricity demand and the stringent grid reliability standards set by EMA.