Water price to rise from April 2024; Government to provide support for lower- and middle-income households
Singapore, 27 September 2023 – Water price will be revised in two phases on 1 April 2024 and 1 April 2025, to reflect the rising costs of producing and supplying water.
2 Water security is essential for Singapore. Water is a strategic resource that all of us – individuals, businesses, and the Government – must safeguard. Through long-term planning and continual investments in critical water infrastructure, Singapore has developed the Four National Taps to ensure a safe and reliable water supply to meet the needs of our population and economy. In Singapore, water is priced to recover the full cost of its supply and production, and to reflect the cost of producing the next drop of water. This right pricing of water also encourages water conservation by households and industries, to achieve a sustainable growth in water demand.
3 Even with active cost mitigation measures by PUB and our contractors, the cost of producing and supplying water has increased substantially since the last price revision in 2017, due to external cost pressures. Average electricity market tariffs have increased by about 37%, adding to PUB’s energy costs as we increasingly tap on energy-intensive sources such as NEWater and desalination to meet growing water demand. Construction costs in Singapore have also gone up by 35% across the industry, with higher increases for specialised works PUB must undertake, such as tunnelling and pipeline projects through highly urbanised areas. PUB’s expenses for essential chemicals in water and used water treatment have increased by about 33%, due to inflationary pressures and supply chain disruptions. Similarly, maintenance expenses have risen by 18% due to higher manpower costs for contracted services.
4 Singapore’s water demand is projected to almost double by 2065 in tandem with economic and population growth. Climate change will also put greater strain on our local catchment and imported water which are weather-dependent. To ensure the security and sustainability of our water supply, we will need to maintain long-term investments in water infrastructure and further develop our weather-resilient water sources such as NEWater and desalinated water, which are more energy-intensive and costlier to produce.
5 The current potable water price is set at $2.74 per cubic metre. To meet the higher costs of supplying and producing water, the potable water price will increase by 50 cents per cubic metre (equivalent to 1,000 litres of water). This will be implemented in two phases – an increase of 20 cents per cubic metre from 1 April 2024, and a further 30 cents per cubic metre from 1 April 2025. This would represent an increase in water price of about 2.5% per year since the last price revision. The phased approach, with a smaller increase in the first year, is intended to help households and businesses adjust to the price increase and allow more time for the adoption of water conservation measures. For NEWater customers, the NEWater price will increase by 17 cents per cubic metre, similarly carried out in two phases.
Support for Households and Businesses
6 With the full price revision implemented from April 2025, 3 in 4 households will see an increase of less than $10 in their monthly water bills, before government support. Similarly, 3 in 4 businesses (including small and medium enterprises) will see an increase of less than $25 in their monthly water bills. Water bills account for less than 2% of an average household’s expenditure. For most businesses, their utilities bills – which include electricity, gas, and water – make up less than 5% of their business costs.
Support measures for HDB households
7 The Government will provide additional financial support to help mitigate the impact of the water price increase and other cost of living concerns, especially for lower- and middle-income households. Details will be announced by the Ministry of Finance shortly. PUB will also work with the Ministry of Trade and Industry and relevant authorities to advise against profiteering by businesses.
8 All 1-, 2- and 3-room households can also apply for e-vouchers under the Climate Friendly Households (CFH) Programme, to offset the costs of purchasing water-efficient shower fittings. In the coming year, there will be enhancements to extend the programme to more water fittings to support water savings. Tapping on the CFH programme will help households to reduce water and energy consumption while benefitting from utility savings of around $50 to $150 per household annually.
Support for businesses to enhance water efficiency
9 Businesses may also tap on PUB’s recently enhanced Water Efficiency Fund which provides support for companies in implementing water efficiency projects. Businesses are encouraged to tap on the fund to implement water recycling and water-efficient systems and technologies. By doing so, companies can reduce their water demand and achieve sustained cost savings in their business operations.