Introduction
Apart from the sun, water, and air, one of the things that we can’t live without is electricity. It powers just about everything in our homes, from lamps to laptops. As such, it’s really no surprise that there was a huge commotion when the Electricity Market in Singapore was liberalized nationwide in 2019.
This meant that Singapore Power (SP) Group was no longer the sole electricity provider or Singaporean electricity company.
In other words, consumers are now given a choice of which electricity provider they want to subscribe to, instead of being forced to stick with the default SP Group.
In fact, over 10 new private electricity retailers have since entered the Electricity Market, each vying for their share of customers. The initial competition was great news for us consumers as it meant things like promos, freebies, and lots of enticing discounts. Even now, most of the competition have prices lower than SP Group. So most Singaporeans should jump ship, right?
Well, it’s not as simple as it seems. Contrary to what you might think, there are many factors to consider before Singaporeans decide to sign up with a new retailer. Some might still choose to stick with SP Group, even if it costs a little more but others may find that other electricity retailers, like Senoko, offers better deals.
If you’re looking to find out why, or just want more information on Singapore’s Electricity Market, read on! Here, we weigh on whether Singaporeans should switch electricity retailers soon; for those on the fence, this should help you make a decision!
1. Branding
This might come as a surprise, but people aren’t as objective as you might think. In spite of guaranteeing the same quality and reliability, using even the same electricity grid and hardware to deliver power, people often feel that the newer brands are less dependable, even if it isn’t true. After all, many of these new retailers are also completely new entrants with new names that people don’t identify or resonate with and this may make them more biased.
Taking a closer look, this is in part due to how well SP Group has done over the past few decades. With few outages or problems with power supply over many years, they have inevitably gained the trust of many members of the older generation. Of course, credit must be given where it is due, and their outstanding track record automatically earns them the trust of the general public.
That said, even though the newer players lack in having a track record, besides bigger brands like Tuas or Keppel, this does not mean that they are not dependable. In fact, some of them, like Senoko offer tons of attractive discounts and privileges that SP Group doesn’t. It really doesn’t get any better than this. Plus, they guarantee the same quality; This makes it worth giving them a go, don’t you think?
2. Too Many Choices
With so many new retailers, consumers are simply spoilt for choice. What’s more, unlike other markets with a similarly strong competition, it is fairly difficult to find an obvious advantage for each player.
For instance, you can easily say that a sneaker brand is better than another because it has the shape, design, and quality that you like — but you just can’t make the same comparisons among the electricity companies. Similarly, you can easily point out why you prefer a shampoo brand over another, perhaps based on smell or conditioning properties, but with electricity retailers, the differences just aren’t as intuitively obvious.
Instead of physical attributes, customers have to analyze the different pricings, packages, and discounts. While this means that most would rather just stick with what they have, it also means that they are missing out on a plethora of benefits by not giving other electricity retailers a chance. With ample research, it is certainly possible to find new players who offer better prices; which goes a long way to helping consumers save a couple of bucks every month. And for those looking to cut on household expenses, this is definitely a good way to do so. The only thing to take note of is reading the fine print and clauses to examine how long the discounted rates apply for.
3. Attractive New Perks
Getting potential customers to take the step to switch to a new Electricity Retailer is harder than you might imagine. After all, when it comes to things like these that require logistics and paperwork, the inertia is strong. To convince customers to overcome the inertia and switch retailers...that takes more than just marginally better prices.
However, fortunately, we see many more perks from these new players in the open market. In contrast, bigger, more established players like Keppel and Senoko have their own difficulties in presenting something irresistible to entice new customers. The best deals include referrals, cashback, and vouchers; they certainly give people plenty more reason to consider switching to a new energy provider.
A potential downside is that not all the new electricity retailers consolidate their billing system with SP Group’s existing utility bills. As such, instead of just receiving one bill a month for all the utilities, a customer who switched would receive and have to pay two separate bills. This might be a hassle for some, but the significant reduction in costs does make it worth it!
In addition, the current arrangement with SP Group for most is already pretty affordable. It’s fair to say that most households are used to forking out a consistent sum of money to foot the electricity bill. As a result, if you are not feeling any pinch on the wallet right now, you may not have a reason to switch to a different electricity provider — but it certainly won’t hurt to save a few more coins.
Conclusion
All in all, these three considerations are the main things on people’s minds when they think about switching to a new electricity retailer. However, that doesn’t mean things won’t change in the future! As the Open Electricity Market continues to evolve and grow, it won’t be long before we start seeing some serious competition and change from the status quo.
And that’s a good thing for us as consumers, as it opens the door to competitive pricing, efficient processes, reliable power supply, and good customer service. After all, in a market as tight as this, the customer is truly king.
