SINGAPORE, 18 October 2021 – Electricity retailer Union Power Pte Ltd (“Union Power”) said today it will reorganise its business after sustained hikes in wholesale energy prices in Singapore. This will involve ceasing some retail electricity accounts while continuing business-as-usual with most residential customers, the majority of its clientele.
However, Union Power, an independent electricity retailer (“IR”) in Singapore licensed by the industry regulator Energy Market Authority (“EMA”), emphasised that it will not exit the electricity retail market in Singapore.
The recent volatility in the global energy market has impacted the National Electricity Market of Singapore very significantly as local power generation relies largely on natural gas.
The sustained spikes of the Uniform Singapore Energy Price (“USEP”) are due to a combination of factors and cannot be fully mitigated through hedging or participation in the electricity futures market. Based on media reports several IRs have announced the termination of accounts due to what the EMA itself has described as “exceptional circumstances”.
Union Power, a member of homegrown Union Energy Group (”UEG”) which has more than 40 years of business history, has updated EMA on its decision.
It issued today letters to a total of 850 customers who will be affected by the business reorganisation. Following the reorganisation Union Power will have a portfolio of approximately 20,000 accounts.
Customers affected by the reorganisation can appoint a new retailer or have their accounts transferred to SP Power. The transfers will take place by the close of business on 22 October 2021 (Friday). Union Power will make the necessary arrangements to ensure minimal disruption of electricity supply.
Union Power said that due to the sustained price surges it had to segregate customers according to levels of usage. Base load customers usually use a minimum and continuous amount of electricity on a typical 24-hour period with little change to their requirements. By contrast, peak load is less predictable and hence, more expensive.
Union Power is ceasing mostly peak usage accounts such as commercial customers, some of whom are in arrears. Where applicable and not in arrears, these customers will receive payment from Union Power. Most non-peak accounts such as residential households, will not be affected.
The affected customers can choose to have their accounts transferred to SP Group or do so by default to SP’s prevailing terms and conditions. Alternatively, they can appoint a new licensed retailer by noon on 20 October 2021 (Wednesday). Transfers of accounts will be made by the close of business on 22 October 2021 (Friday).
Ellen Teo, executive director of Union Power, said “This unprecedented and sustained price volatility has placed immense pressure on all IRs. Union Power has embarked on reorganisation with sadness as it values customer loyalty and relationships. This is a difficult but necessary step to ensure the financial viability of Union Power.”
“I would like to reiterate that Union Power remains active in the electricity retail market. We are committed to our long-term strategy which includes participating in renewable energy activities, in line with the long-term vision of EMA, to make Singapore a greener and more sustainable city,” she said.
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About Union Power
Union Power Pte Ltd (“Union Power” or the “Company”) is a leading digital energy retailer, licensed by Singapore’s Energy Market Authority. The Company is a subsidiary of Union Energy Corporation – the largest bottled-gas supplier in Singapore – and a member of Union Energy Group (“UEG”), which has over 40 years of operating track record in the business of retailing LPG, Natural Gas, Diesel and Electricity in the Commercial, Industrial and Residential markets.
Founded in 2017, Union Power launched Union Solar in September 2020, in line with its push towards sustainable solutions through solar energy power generation.
For more information, please visit: https://unionpower.com.sg/
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