Benchmarking Your Electricity Bill Against Singapore Averages

Is Your Business Paying Too Much?

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Key Takeaways

Singapore’s commercial electricity rates vary by consumption and sector, with SMEs paying slightly more per kWh than large users.
Outdated equipment, poor insulation, inefficient lighting, and aircon misuse are common cost drivers.
Benchmarking your bill against similar businesses helps identify inefficiencies and savings opportunities.

Introduction

Electricity is one of the largest operational expenses for businesses in Singapore. Many business owners face the frustration of unexpectedly high bills, fluctuating rates, or struggle to understand why their costs seem higher than competitors’. Perhaps you’ve noticed your air-conditioning running constantly, your lighting bills skyrocketing, or your equipment guzzling more power than expected, yet you’re unsure how to pinpoint the cause.

Learning how your electricity costs compare to industry benchmarks can help you identify hidden inefficiencies and uncover potential savings. Here’s how.

1. Understanding the Average Commercial Electricity Rates in Singapore

As of early 2025, the regulated electricity tariff for commercial users in Singapore is approximately 27.55 cents per kWh before GST. This rate applies to businesses consuming less than 4,000kWh per month and purchasing electricity from the SP Group

For larger businesses with a monthly consumption of over 50,000 kWh, electricity rates are usually negotiated in advance, as their energy needs are significantly higher and more complex. Smaller businesses, on the other hand, typically opt for a fixed-rate plan. This means that even if their usage fluctuates month to month, their electricity rate remains the same, providing cost predictability and stability.

These figures give a benchmark for what the average electricity bill looks like for businesses of different sizes in Singapore, helping you gauge whether your own costs are reasonable.

2. What Factors Drive Your Business’s Energy Costs Up?

Several factors can push your electricity costs above average:

Outdated Equipment: Older machinery and appliances often consume up to about 25% more energy than newer, optimised units performing the same tasks.
Poor Insulation: Inadequate insulation leads to higher cooling costs, especially in Singapore’s tropical climate.
Inefficient Lighting: Traditional incandescent or fluorescent lighting consumes 40–80% more electricity than modern LED alternatives to produce the same brightness, leading to significantly higher energy usage and costs.
Unmanaged Air Conditioning Use: Excessive or inefficient aircon usage can dramatically increase your monthly bill.

By understanding these common culprits, you can begin identifying areas where energy wastage is occurring.

3. How to Benchmark: Comparing Your Bill to Similar Businesses

To determine if your business is paying too much, here’s what you can do:

Analyse Your Bill:

Start by reviewing your electricity bill in detail. Identify whether your business is on the regulated electricity tariff (typically applicable for smaller commercial users) or an electricity plan under the Open Electricity Market (OEM) with a contracted rate through a retailer. Take note of your total monthly consumption in kWh and the rate per kWh you are paying. Understanding these details helps you determine whether your current plan is competitive and appropriate for your usage profile.

Calculate Energy Intensity

Energy intensity is a metric that measures how efficiently your business uses electricity relative to its size or staffing. It can help you compare your efficiency with similar businesses in your sector. Common ways to calculate energy intensity include:

Per Square Metre: Energy Intensity (kWh/m²) = Total Monthly Consumption (kWh) / Total Floor Area (m²)
Per Employee: Energy Intensity (kWh/Employee) = Total Monthly Consumption (kWh) / Number of Employees

A lower energy intensity indicates more efficient electricity usage relative to your business size or workforce. Tracking this over time also helps identify trends and improvements.

Identify Red Flags

Compare your energy intensity and monthly bill with industry averages. Look for:

Unusually high consumption patterns: For example, a retail store that uses significantly more kWh per m² than the industry average might have outdated lighting or HVAC systems.
Rates that exceed typical plans: A small business on a fixed-rate plan paying substantially more than other similar businesses may benefit from reviewing alternative OEM plans or negotiating a better rate.

Benchmarking provides a clear picture of whether your business is overpaying and highlights opportunities for improvement.

4. What to Do If You’re Paying Too Much: Steps to Cut Costs

If your electricity costs are above average, consider these steps:

Implement Energy Efficiency Measures

Upgrade to energy-efficient equipment, improve insulation, and optimise lighting and air-conditioning usage.

Review Your Contract

Ensure your plan matches your business’s energy needs. Things to consider include:

Plan Type: Are you on a fixed-rate plan, a regulated tariff, or a contracted rate through an OEM retailer? Each has different cost implications and flexibility.
Contract Duration: Long-term contracts can offer stability, but may prevent you from switching to cheaper plans if market rates fall.
Usage Tiers and Limits: Check if your plan has different rates for varying consumption levels, for example, some plans may charge more once usage exceeds a certain threshold.

Switch to a Better Electricity Plan (IMPORTANT!!) 🌟

Compare electricity rates in Singapore under the Open Electricity Market for more competitive rates.

Explore Renewable Energy Options ☀️

Installing solar panels for businesses to generate their own renewable electricity may reduce long-term costs.

Implementing these strategies can help bring your electricity expenses closer to the average electricity bill, freeing up budget for other business priorities.

In Conclusion..

By understanding the average electricity bill and identifying factors that influence your energy costs, you can take proactive steps to optimise consumption, reduce waste, and improve your bottom line. Benchmarking your usage not only highlights inefficiencies but also opens the door to smarter energy solutions that can significantly lower your expenses over time.

Take the first step towards lowering your business electricity costs 💵⚡️

Switch to a more affordable electricity plan with Flo Energy, now matched with 100% renewable energy certificates (REC) at no extra cost, a simple way to save money while going green.

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