SINGAPORE (June 25): When Tan Tiong Peng started a laundromat in Singapore eight years ago, customers complained that his imported washing machines spat out too little water as they put their clothes to wash. It took Tan almost a year to convince customers that his Europe-imported models used a lot less water for the same load of laundry than conventional washing machines, as water tariffs were much higher in European countries. “With our washing machines, water now makes up only 5% of our cost, even if water tariffs go up by 30%, it is not a lot for us,” says Tan, who owns the Wonder Wash and SQ Laundromat brands as well as other franchises with a total of 88 shops across the island.
It was the right decision for Tan to get those European washing machines, with Singapore raising its water prices by roughly 30% after 17 years. The first hike came last July and the next will take effect next month. For non-domestic users, water prices went up from $2.15 per cu m to $2.39 per cu m last July, and will go up to $2.74 per cu m from July 1 this year.
For Singapore, water has always been an existential problem. Malaysia supplies 50% of Singapore’s water demand, under the terms of the 1962 Water Agreement. That lapses in 2061, but Singapore already has a jump-start on water self-sufficiency. By 2060, 85% of its water needs will be met by desalination and NEWater plants, which currently can supply up to 65% of Singapore’s water demand. The city state has five NEWater plants, three desalination plants and two more desalination plants on the way. It is also building a $6.5 billion underground sewage tunnel system.