Government may extend Temporary Electricity Contracting Support Scheme

Singapore

THE government may extend the Temporary Electricity Contracting Support Scheme (TRECS) beyond May, amid concerns about the impact of the Russia-Ukraine war on the energy market, said Second Minister for Trade and Industry Tan See Leng on Friday (Mar 4).

Introduced last December, TRECS provides large electricity consumers with a viable option to reduce their exposure to the volatile wholesale electricity prices through fixed price contracts with electricity retailers. The scheme was extended once from March to May and may be extended further if necessary, said Dr Tan during the Ministry of Trade and Industry's Committee of Supply debate in Parliament.

This comes alongside his assurance to the House that the government will "spare no effort" to ensure that Singapore's energy supply remains secure and reliable.

Singapore is expected to be affected by high and volatile global gas prices due to the war in Ukraine, even though Dr Tan said Singapore's sources of fuel are diversified and the war poses limited direct risks to the Republic's supplies.

Other measures include ensuring that generation companies have sufficient fuel reserves and establishing a standby fuel facility which generation companies can tap on to produce electricity, he added.

Beyond energy, Singapore's imports from Ukraine and Russia will be affected, even if it imports "very little" from Ukraine, said Trade and Industry Minister Gan Kim Yong. He noted that the Republic was importing eggs from Ukraine at the start of the Covid-19 pandemic but has since diversified its supplies.

Singapore is also likely to see rising cost pressures with the war further disrupting already tight supply chains, he said, adding that shipping lines may be affected on top of flights.

"These will lead to higher costs, and higher costs will eventually impact everyone. And, Singapore being an open economy, we will not be able to insulate ourselves from all this impact," Gan said.

He added that the government is monitoring the situation and will provide more support for business and households if necessary.