Posted at request of Vincent Sear
Editor
Today paper
I refer to the article November 1-2, 2008: "SP Services" Don't Shoot The Messenger."
The essence of the matter is, even if SP Services is just the middleman or "messenger" as it now calls itself, how can electricity tariffs be based on US$155 per barrel of oil as announced by SP Services itself it September 2008, to justify a 22% price hike based on "forward pricing"?
Now, SP Services is claiming "average price." Whatever, be it forward pricing or average price, how come Singapore households and businesses are billed based on a much higher price? Oil price hit a peak of US$147 per barrel in July 2008 and has been falling thereafter.
How come Singapore consumers are billed based on US$155 per barrel for the quarter of October to Decemeber 2008 when oil price never hit that high? What's going on between the power generating companies (gencos) and SP Services and the Energy Market Authority (EMA)?
Oil price is now about US$70 per barrel or below. Can Singaporeans expect a corresponding 55% cut in tariffs and bills?
Vincent Sear
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18 comments:
Is it possible that somebody made a mistake to close the forward contract at $155 and the consumers now has to bear the consequence of that mistake?
well said, and is people like you who dare challenge the 'authority' that shall allow democracy and the plight of the commonmen be heard, when things are up, they raise but when down, nothing is benefited to the society of the common men, i hope to witness and acknowledge the modern day 'robin hoods' like you and Mr Tan, thought having said, m not in Singapore always to take this 'shit' of the common authority that pushes all increase with whim and fancy upon their very own citizens.!!
Do you think a protest petition will do any good? As a retiree, I am so tired of citizens having no say over monopolistic price hikes. I don't have the luxury of using air conditioning even on very warm days. I reduce my lounge lighting to 18watts (energy saving), so much so that I can't even read the newspapers with this light. What else can I cut down on? I am sure the millionaire ministers have no worries about their monthly bills for such basic amenities.
chew
I suspect that SP services has been speculating in the energy market and bet wrongly that oil prices will keep on rising. Therefore there is a need to use wierd measures like "average pricing" or "forward pricing" to cover it up.
Is there any regulation in this respect?
2chan
Basically, they can charge whatever they want.
If they want to peg, I suggest a daily peg. Something like the stock market where prices are shown daily. There's nothing more transparent than that.
In fact, the SMRT and SBS should also peg to daily rates and show it on their big LCD screens on the platform.
That way, people have absolutely no way to complain. They know exactly what they are paying for.
Now, we don't even know what we are paying for.
Tks to Vincent n Tan KL,we wonder how many Singaporean read>understand>take action on this subject re:SP Services itself in September 2008, to justify a 22% price hike based on "forward pricing"?...
Oil price is now about US$70 per barrel or below. Can Singaporeans expect a corresponding 55% cut in tariffs and bills?apparently this is good to SP local consumers but not so good for ..?
S'pore Power is owned by Temasek Holdings. SP owns assets overseas: Australia, Taiwan and South Korea. SP AusNet is a subsidiary of SP. Dallas-based TXU in Australia???
Could it be they over-committed and over-stretched in their acquisitions of assets overseas???
If they are going to reduce the price, I am fine. The recent fuel is reduced to US$70, then why are they increasing the electricity price? They will reduce it later right? If not, I think it is unreasonable.
This is probably a hedged forward option pricing done during the USD147.00 period. In a forward hedge securities eg futures, you agreed on a future price for delivery of oil regardless if the price goes up or down in future. And since price did came down, you still taking delivery at USD155.
Strangely enough, I thought I read somewhere the electricity is product in little dot from natural gas pipes from indonesia? so whats has oil price got to do with that?
Thanks for posting my comment. :)
Newsprint forums are very "competitive" for space. There's no high hope that it'd get published there. ;)
It's utterly very frustrating that nothing can be done on our part to voice this frustration.
It's time for all of us to come together to do something but how many have the courage to do it?
Could SP Services provide a breakdown of the increases levied by each of the component as follows:
B4 After % increase
EMA
SP
Genco
With this, we can see clearly where the bumper profit goes to
Regards
To Parka, you said...
"Now, we don't even know what we are paying for."
Oh yes we do - we pay to get screwed big time...
POWER, people, its about POWER.
No Power No talk.
Just a minor correction. It's S$155 and not US$155.
Please note that the increase is only affecting HOUSEHOLDS. Businesses do not bare this. Why the discrimination? Check www.spservices.com
The SS
Hi Mr Tan, i hope you do not mind but i've put a link on my blog. I think these sort of news need as much circulation as possible. Though i doubt my blog has any readers.
http://informationreadbyme.blogspot.com/2008/11/reply-to-sp-services-dont-shoot.html
My thoughts here: http://singaporesocialactivist.blogspot.com/2008/11/just-messenger-then-sp-services-should.html
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