CNA Explains: Electricity tariffs are at a record high. Should you lock in a fixed-price plan now?

Will electricity tariffs come down?

Possibly, but not immediately.

Singapore generates about 95 per cent of its electricity using imported natural gas, leaving local electricity prices highly vulnerable to supply shocks in global fuel markets.

Grid operator SP Group reviews the regulated electricity tariff every quarter, based on the gas prices in the first 2.5 months of the previous quarter, according to EMA. 

For example, gas prices between April and mid-June 2026, when global fuel prices were elevated, are used to set the tariffs for July to September 2026. 

This means that changes in fuel prices in the third quarter will only show up in the electricity tariffs in the fourth quarter. 

“The record high electricity tariffs are at a critical watershed now – much will depend on the still unfolding scenario on the Middle East oil and gas situation,” said Professor Lawrence Loh, director of the Centre for Governance and Sustainability at the National University of Singapore (NUS) Business School.

“Even when there may be truces for the current periods, the setting can be volatile,” he said.

“It is likely that the fuel and electricity prices will remain high, if not rise higher, before they can subside if the situation gets better”

Dr Sung Jinseok, a Research Fellow at the NUS Energy Studies Institute, said that while electricity prices may fall in the fourth quarter if the geopolitical situation in the Middle East stabilises, the fall is more likely to be insignificant.

“In many countries, Q3 is a peak demand season, and there are still a lot of uncertainties in the situation in the Middle East,” he said.

“A return to the pre-conflict price level can happen in 2027, assuming the situation will be normalised in the Gulf region.”