Water tariffs in Singapore will increase in 2017. The unwelcome price hike will finance new projects to keep the taps running for citizens and also create lucrative opportunities.
By Oliver Ward, edited by Francesca Ross
Water is the life blood essential to our survival. Yet prices for that basic need are increasing as a crisis point for supplies looms. Singapore’s 2017 budget announcements outlined plans to raise the price of water by 30%, the first increase in 17 years.
Finance Minister, Heng Swee Keat, described how the plan will feature two separate rises. There will be one on the 1st of July 2017 and the second a year later.
The move was justified by increasing costs and high water usage across the country. MP, Dr. Lee Bee Wah, said,“The increase in water prices is just to bring up the awareness of the importance of water.”
Most families will be affected by the price spike
For most families, living in HDB accommodation the price rise will mean an extra S$9 to S$15 (US$6 to US$10) a month for turning on the tap. With the U-save scheme, those living in one or two room public flats will actually see their water tariff decrease of around S$1 (US$0.75). The U-save schemes and adjustments mean that in reality, 75% of households will see an increase of less than S$18 a month on their existing water bills.
Most businesses will see an increase of less than S$25 (US$18) a month. In an attempt to discourage water waste, houses who consume more than 40 cubic meters a month will be charged a premium. The price per cubic meter over the allotted 40 per month will be S$3.21 (US$2.26) compared to the normal rate of S$2.39 (US$1.68) per cubic meter.
The public have been left confused
To the general public of Singapore, the news comes as a surprise. The country is already paying a lot for water, ten times more than neighbouring Hong Kong.
Residents took to twitter to express their confusion. M.K. a Singapore resident questioned the logic. Saying “Water is important. That´s why we raised its price by 30%. Now you know how important it is.”
The Singapore Democratic Party also denounced the price increases. Secretary General, Chee Soon Juan questioned “How is this justifiable?” and called it “shocking” that the government would increase prices “at a time when Singaporeans are facing great uncertainty”.
The road to self-reliance.
Singapore faces geographical challenges to securing a sustainable source of water. The country has no natural sources and very limited land space from which to collect and recycle rainwater.
After the droughts of the 1960s, Singapore turned to imported water from Malaysia. The 1961 and 1962 bilateral agreements saw Malaysia providing 250 million gallons of water a day to Singapore. The agreements were negotiated to stand for 99 years. They expire in 2061. Malaysia has not been shy to leverage to their advantage.
The leverage was also financial. In August of 2000 Malaysia wanted to renegotiate the price Singapore was paying for water. Goh Chock Tong´s government in Singapore had no intention of allowing Malaysia to raise the price of water whenever it felt like it. They were prepared to discuss the demands as part of a bilateral package but no agreement was made.
Singapore has had to use water policy to overcome its water vulnerability.
To achieve self-sufficiency and end reliance on Malaysian water imports, Singapore’s water policy and research since the 1970s has focused on technology. The NEWater scheme purifies rain and waste water for reuse. The scheme now has a catchment area covering two-thirds of the island. In 2005 the country opened their first desalination plant. The plant turns 30 million gallons of sea-water a day into potable water for domestic use.
Having a self-sufficient water supply was more than just an economic issue, it was sensible foreign policy. Malaysia has had a bargaining chip which has allowed them to tip the scales in their favour during negotiations. It removes the threat of water security from the table.
Unpredictable weather calls for innovative solutions.
Dry weather in 2016 has left reservoir levels much lower than usual. Levels in the Johor Linggiu Reservoir have reached record lows. The reservoir is down to just 32% capacity. Singapore will now want to get as much as possible out of each drop of water.
Countries like Israel who have been able to recapture 86% of their waste water demonstrate the benefits of a successful water recycling system. The country is 60% desert, yet has a surplus of water annually because their recapture rate is the highest on the planet. The water is reused in agriculture with minimal treatment.
Singapore has adopted this scheme itself using NEWater, but is currently unable to achieve the level of efficiency seen in Israel. Singapore’s Limited ground space for water catchment has made the process difficult. The country currently has a catchment area covering two-thirds of the country’s land surface. There are goals to increase this to 90% in the long-term.
The price increase is necessary to ensure future sustainability.
Predicted population increases anticipate the current demand of 400mgd a day to double to 800mgd by 2061.The government’s objectives are to have desalination plants and NEWater providing 85% of Singapore’s water needs by 2061. The process is expensive. The cost of desalination is three times the cost of imported water due to the energy required to create the pressures necessary for sea-salt extraction.
The Director of Engineering Development and Procurement at PUB, Mr Young Choo Chye is committed to the process of desalination. He said “Desalinated water is a key pillar of Singapore’s water supply strategy.” Desalination allows Singapore to tap into a new, non-traditional water supply which is resistant to drought and increasing global temperatures. The PUB undoubtedly see desalination as the solution to Singapore’s water crisis.
There are plans to build more desalination plants.
The two plants already in operation, both in Tuas, are able to produce 100 million gallons a day from the sea. A third is expected to be finished this year, with a price-tag of S$217 million (US$153 million) to the public purse. Two more plants are expected to be operational by 2020.
The relationship between Malaysia and Singapore is shifting thanks to intelligent water policy. Singapore actually exported potable water to Malaysia on three occasions in 2015 and 2016. Extreme weather had caused a shortage in potable water for domestic use. In the same way water was a valuable tool in Malaysia´s foreign policy with Singapore, drier conditions and water scarcity from natural sources will only increase reliance on alternative methods of sourcing water. Singapore’s water innovation and technological development are beginning to bring international leverage in the arena of global foreign policy.
The government plan to invest S$4 billion (US$2.82 billion) in water infrastructure over the next five years. It will be funded from the imminent price rises. As weather conditions become more unpredictable and the effects of climate change are felt, we can expect other countries to look for alternative methods to source their water supply. In the future, Singapore will be able to export their technology and expertise, making them a global leader in water solutions.
The price hikes may hurt the public wallets, but Singapore is one of the leading countries for the development of desalination techniques and they are already exporting this technology across the world.
An ever-increasing population and hotter temperatures are pushing our planet towards its breaking point. Singapore’s steps towards water self-sufficiency and cutting-edge water sourcing techniques represent a nation’s ability to turn a problem into a promising opportunity. What Singapore lacks in natural resources, it more than makes up for in innovation. When water shortages and drought begin to affect the global north, the world will look to Singapore as a beacon for what can be achieved with limited water sources.