It's baffling then that many households appear somewhat insouciant, opting to stay put with the default provider and incumbent SP Services and its regulated tariffs rather than to jump ship to one of the 13 retailers under the Open Electricity Market since it was soft launched in Jurong just over a year ago and rolled out in phases across the nation. Blame that on complacency and"analysis paralysis".
Yet, he is not jumping for joy - not yet, at least - at the prospects offered up by a freer market - lower power bills and a glut of choices. Consumers worry that other retailers may suffer the same fate and their lights could go out."That's very pessimistic," says Mr Vijay, adding that the processes are"clearly established" to avoid supply disruption."It's just a matter of paper work," he says, referring to the switch from the existing retailer back to SP.
Also,"significant volatility" in the wholesale electricity market where retailers buy their power and limited risk management avenues - there is only the Singapore Exchange's electricity futures for retailers to hedge contracts - prompted a rethink on the firm's business model. In 2017 alone, based on data provided by the Energy Market Company , six new retailers joined the National Electricity Market of Singapore , ostensibly to ready up for retail action under the OEM which covers consumers that accounted for some 20 per cent of Singapore's energy consumption last year.
"Cost is a critical make-or-break factor. That some have left is a sign that they were unable to cope with that," Mr Krauss adds. Andrew Koscharsky, chief commercial officer of green energy retailer iSwitch, concurs:"No room for more than 10 retailers doesn't necessarily mean financial ruin. Just consolidation. will be orderly"."There will be mergers... if a retailer has twice as many customers through a merger, then it will be better able to generate margins. Ultimately, the market will end up with a limited number of players with unique characteristics...