In the event that the real-time and procurement markets are suspended, the Market Rules: Chapter 6, Section 1.2.5 states that all market participants shall be settled for physical services injected onto and withdrawn from the transmission system. The prices used for this settlement may be calculated using a methodology determined by the EMA in consultation with EMC and the Power System Operator (PSO). Chapter 6, Section 1.2.5A specifies EMC to publish the methodology provided by the EMA. The methodology was provided by the EMA for publication on 1 October 2003.

The cost of purchasing regulation products from the market is co-shared by retailers and generators. The AFP is determined for retailers based on their consumption (metered withdrawal quantities), and for generators based on their injected energy quantity, up to 5 MWh.

On behalf of and at the request of the Power System Operator (PSO), EMC procures, primarily through contracts, certain physical services that are needed to maintain reliable system operations but are not offered on real-time markets.

The principal contracted ancillary services that EMC may procure are:

• reactive support and voltage control service,
• black-start capability,
• fast-start services, and
• reliability must-run services.

With EMC granted derogation from Section 8.3.1.1 of Chapter 5 of the Market Rules, EMC can procure ancillary services contract for a period not exceeding 1 year. Henceforth, in consultation with the PSO, EMC procured black-start capability services for period 1 Apr 2011 to 31 Mar 2012, details of which are tabled below:

Ancillary Services Contract Agreement

The cost of ancillary services is recovered by EMC through the Monthly Energy Uplift Charge (MEUC) as outlined in the Market Rules: Chapter 7, Section 4.1.

The 9 key requirements of the ancillary service to be procured for period 1 Apr 2012 to 31 Mar 2013

The demand forecast reports the electricity consumption of Singapore in each half hour. The forecast excludes transmission losses and generation from exempted embedded generators.

These fees are the approved administrative costs for EMC and the PSO to operate the NEMS in each fiscal year. These fees are recovered from both generators and retailers based on per MWh generated or consumed.

This charge captures any differences between total amounts received from retailers and total amounts paid to generators for energy, reserve and regulation products. While the HEUC is called a charge, it is typically a return to retailers of the revenue arising from the sale of energy to cover transmission losses.

At the end of each calendar month, EMC calculates the Monthly Energy Uplift Charge (MEUC) for the following calendar month and recovers from the load on the basis of withdrawal quantity in MWh. This charge, levied on retailers, covers the following potential payments and refunds each month:

• the cost of procuring contracted ancillary services (e.g., black-start services) and related costs,
• compensation claims and refunds,
• financial penalties and refunds, and
• the estimated monthly energy uplift shortfall to be recovered and/or deducted in the following calendar month.

Numerical information on the MEUC determined in accordance with the Market Rules Chapter 7, section 4.1.

Nodal energy prices are the prices received by generators. Nodal prices are determined according to the demand and supply characteristics of each of the injection nodes (market network nodes, or MNNs, on Singapore's electricity network, approximately 60 in all).

The regulation price is the market price for the regulation product. Regulation is generation that is on stand-by to fine-tune the match between generation and load. The cost of regulation products is co-shared by generators and retailers.

A reserve provider group is a group of reserve providers that share similar effectiveness characteristics. In the standing data of the NEMS, reserve provider groups range from A to E. These correspond to a payment incentive structure range of 0.95 to 0.55, illustrated in the table below.

A reserve provider group is a group of reserve providers that have similar effectiveness characteristics. Based on the PSO's System Operation Manual (SOM), the reserve provider groups (or groups are defined as) are calculated as follows:

1. A surge is referred to as an event in which the frequency dips between the estimated ranges of 0.2 Hz and 0.18 Hz.
2. The PSO will measure all surges in a quarter. However, the PSO needs at least six surges to perform the computation(s).
3. In the event that fewer than six surges are observed in a quarter, the PSO will use figures from the previous quarter to perform the computation.

The reserve price is the market price for the three classes of reserve products (primary, secondary and contingency). Reserves are the stand-by generation capacity or interruptible load that can be drawn on when there is an unforeseen disruption to supply. The cost of reserve products is borne by generators.

The USEP is the energy purchase price paid by retailers. It is the weighted average of energy prices at all the off-take nodes on Singapore's electricity network.

The VCRP_MSSL is the price used to allocate any Vesting Contract Settlement Credit or Debits from MSSL to the end consumers. The VCRP_MSSL is the average of the Vesting Contract Reference Prices (VCRPs) for all vested generators' settlement accounts, weighted by their respective vesting contract quantities. Further details on the vesting contract regime can be found at the EMA website.

The WEP is the net purchase price paid by retailers, inclusive of all administrative costs incurred in the wholesale market. This price consists of the following cost components: USEP, AFP, HEUC, MEUC, EMC fees and Power System Operator (PSO) fees.