Singapore's energy regulator said on Saturday that it is working closely with retailers facing challenges from current volatile electricity prices and said there will be no disruption to their customers' electricity supply.
Singapore's wholesale electricity market prices, which are determined every half-hour depending on demand and supply conditions, have been hit by higher price volatility for sustained periods over the past two weeks, the Energy Market Authority (EMA) said.
Several factors were behind the volatility, the regulator said in a statement, including a spike in liquefied natural gas (LNG) prices globally, higher than usual electricity demand in the city-state, curtailment of piped natural gas from West Natuna and 'low landing pressure of gas' supplied from South Sumatra.
"Electricity retailers who have under-hedged their positions may be exposed to the price volatility in the wholesale electricity market," EMA said.
"Some may find it challenging to sustain their operations and may choose to exit the market. This is a consequence of their business decisions and can be expected in open and liberalised electricity markets, where participants may enter and exit the market, and market consolidation may occur."
At least three electricity providers have announced plans to exit Singapore, while two others have stopped accepting new customers.
Global wholesale gas prices have surged in recent months as production and transit problems have lowered supply just as demand took off in a post-pandemic economic recovery, which has pushed up power prices in many countries and caused blackouts in some.
EMA said it is working closely with retailers facing challenges, and will facilitate their efforts to hedge against future price volatility.
It will also allow retailers to suspend their operations by transferring their customers to state-owned SP Group.
There will be no disruption to the electricity supply of the customers of exiting retailers, EMA said.
Reporting by Jessica Jaganathan Editing by Shri Navaratnam