Singapore's Data Centres Are Running on Hormuz-Priced Gas

Singapore has spent two years trying to grow its data centre sector without breaking its energy system. The Strait of Hormuz disruption has shown how exposed that system is to events thousands of kilometres away. On 30 June 2026, SP Group announced that the overall electricity tariff, including non-household customers, would rise by an average of 17.5 per cent, or 4.66 cents per kWh, for July to September compared with the previous quarter. The household tariff rose 17.0 per cent, or 4.64 cents per kWh, to a record high.

For a city where data centres account for about 7 per cent of electricity consumption, the increase is not an abstraction. Singapore generates about 95 per cent of its electricity from imported natural gas, according to the Energy Market Authority (EMA). The EMA said gas imports from Qatar made up less than 10 per cent of Singapore's electricity needs before the conflict. Singapore's regulated tariff is reset every quarter, and its energy cost component is based on average gas prices in the first two and a half months of the preceding quarter.

The IEA's Gas Market Report for the third quarter puts numbers on that period. Large data centres in Singapore typically do not buy at the regulated household tariff. In October 2025, the Economic Development Board and JTC said Jurong Island would host Singapore's largest low-carbon data centre park, with 20 hectares reserved, alongside about 300 hectares set aside for new energies including a hydrogen-ready gas power plant and an ammonia power project. Each of those steps adds load to a system that, for now, means burning more gas.

The Hormuz disruption has not stopped Singapore's data centre plans, and supply was never seriously at risk. Second, pricing mechanisms with lags can hide a shock for a quarter and then deliver it all at once. Third, the case for importing low-carbon electricity, which Singapore is pursuing through cross-border projects in the region, is also a case for energy security. SP Group noted that if the situation in the Middle East improves, tariffs for the fourth quarter may fall.