Energy News

Egypt’s energy subsidies to be removed completely by 2025

The Electricity and Renewable Energy Minister Mohamed Shaker has announced that energy subsidies will be completely lifted by 2025. This announcement was made last Wednesday February 17th by the ministry of reducing energy subsidies by 50% in 4 years to reach cancellation in 9 years.

(Disclaimer: This article is an update of a former version, facts have been modified based on Aswat Masreya‘s article being lifted from their website which carried the claim that subsidies will be removed by 2019)

Earlier last week The World Bank bank claimed electricity consumption in Egypt is much higher than the minimum in low income countries, which is 120 kwh per month. Egyptian households consume on average 234 kph per month, with an average of 212 kwh for rural households and 260 kwh for urban households, which the bank considers as “high”.

The Aswan hydroelectric power plant which actually accounts for about 7.5% of Egypt’s electrical usage only

According to an official World Bank report published on Nov 23rd 2015, the average electricity tariff across consumer groups is set to increase from EGP 0.226 per kwh (kilowatt-hours)

in 2013-2014 to EGP 0.451 per kwh by 2017-2018, which is almost double the cost.

This news also comes in light of presidential decree obtained by Mada Masr of which an agreement for a new World Bank loan stands at its core. Part of the requirements included that energy subsidies are to be reduced from 6.6 percent in FY2014/15 to 3.3 percent of GDP this year, and further by 2018/19. The decree is yet to be ratified by Parliament or published in the Official Gazette, which according to the Egyptian constitution is required for the decree to obtain the power of domestic laws. Many parliamentary members however.

Furthermore, the ministry’s strategy aims to increase the amount of electricity generation using coal and nuclear power stations. This is part of the plan the ministry drafted do provide 51,000MW of power in total by 2035.

What does this mean?

Basically your electricity bills are about to get higher until they reach their actual cost, which will create a financial strain on the average Egyptian household.

This strain can be reduced dramatically by working on living in a more energy efficient home. By making very small changes in your daily habits, you can make noticeable changes in your energy use.

We are here to help! You will find a lot of tips and content through our blog here to help you reduce your energy consumption.

More than that, send us any inquiries you have regarding your energy use and check out our store and have your energy purchases delivered to your door step

 

Sources:

Egypt Independent / Mada Masr / ESI Africa

 

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