COMPENSATION FOR DISRUPTION OF POWER SUPPLY

Mr Noris Ong Chin Guan asked the Minister for Trade and Industry whether it is the policy of utilities companies such as Singapore Power Limited, to compensate consumers (including commercial and industrial users) affected by disruptions to the supply of utilities, as in the case of the recent dip in power supply.

BG George Yong-Boon Yeo: Voltage dips are momentary drops in voltage levels, usually in the order of a fraction of a second. Voltage dips occur in all electric power systems and are caused by many reasons such as cable damage by excavation works and ground movements; equipment failure at customers' installations; and equipment failure at power stations and the transmission and distribution network. Voltage dips cannot be totally eliminated.

The voltage dip on 24th March 2000 was caused by the failure of a voltage measuring transformer in the 230 kV switchgear at Pulau Seraya Power Station. The faulty equipment caused a short circuit which resulted in a voltage dip. The short circuit was detected and the faulty equipment was immediately isolated by its protection system. The defective component has since been replaced and it has been sent back to the original equipment manufacturer in Japan for further investigation to determine the reason for failure.

Disruptions caused by voltage dips vary from one customer to another depending on the sensitivity of their equipment and the protective devices which they have installed to help their equipment ride through such voltage dips. It is hence difficult to estimate losses suffered by companies. Since many of our companies now manufacture high value products such as semiconductors, power dips are therefore a serious concern for many of them.

Compensation payments will arise if there is a contract between a customer and its utilities supplier based on a mutually agreed set of power quality standards and the compensation where there is failure to meet these standards.

Currently, we do not have a generally accepted standard for power quality with respect to power dips although we have standards for power outages. However, in view of the need for very high quality power by our high-tech industries for their sensitive equipment, PUB is currently working with the industry to establish power quality standards for compliance by utilities companies. This will provide clearer guidelines on the quality of the power supply expected.

In addition, we are also undertaking measures to provide an even higher quality of power supply. Last year, we amended the Public Utilities Act to impose heavier penalties on earthworks contractors who damage power cables. This has helped reduce the number of voltage dips.

In addition, as part of the restructuring of the electricity industry which the Minister for Trade and Industry announced last month in this House, PUB will also implement performance-based regulation for PowerGrid, the transmission and distribution company.

With a liberalised electricity market, we can expect to see a variety of service providers provide customised solutions to meet the specific needs of high-tech customers. Meanwhile, to help existing high-tech companies in Singapore, PUB is working with the EDB and PowerGrid to implement a scheme to provide premium quality power. These customers will have to bear the additional costs incurred but Government will assist by co-sharing the cost. Details will be announced when the scheme is finalised.