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Sunday, 9 July 2017

Government announces new electricity prices

The Electricity Ministry raised the price of electricity by around 42% for household consumers last Thursday, according to Reuters. The move, which follows an increase to the prices of fuel last week, removes subsidies entirely for the highest-tier consumers. The new prices for household consumers per month are broken down as follows:

  • The 0-50 KW consumption bracket will pay EGP 0.13 per KW, up from EGP 0.11;
  • The 51-100 KW consumption bracket will pay EGP 0.22 per KW, up from EGP 0.19;
  • The 100-200 KW consumption bracket will pay EGP 0.22 per KW, up from EGP 0.19;
  • The 200-350 KW consumption bracket will pay EGP 0.55 per KW, up from EGP 0.45;
  • The 350-650 KW consumption bracket will pay EGP 0.75 per KW, up from EGP 0.55;
  • The 650-1,000 KW consumption bracket will pay EGP 1.25 per KW, up from EGP 0.95;
  • The 1,000+ KW consumption bracket will pay EGP 1.35 per KW, up from EGP 0.95.

The prices of electricity for industrial and commercial use were also increased across the different brackets, Al Mal reports. Heavy industries will be paying a high of EGP 0.654 per KW during peak hours and EGP 0.982 per KW in the off-peak. The monthly tariff for commercial usage changed acrossfive brackets as follows:

  • The 0-100 KW consumption bracket will pay EGP 0.45 per KW, up from EGP 0.35;
  • The 100-250 KW consumption bracket will pay EGP 0.84 per KW, up from EGP 0.69;
  • The 250-600 KW consumption bracket will pay EGP 0.96 per KW, up from EGP 0.69;
  • The 600-1,000 KW consumption bracket will pay EGP 1.35 per KW, up from EGP 0.96;
  • The 1,000+ KW consumption bracket will pay EGP 1.40 per KW, up from EGP 0.96.

The state will continue to subsidize power for another five years until 2022 rather than eliminate them by 2019 as had been originally planned “owing to the conditions related to the big increase in the exchange rate,” the minister also confirmed. This latest increase is expected to save the state around EGP 30 bn in energy subsidies, bringing the bill down to EGP 52.8 bn in the FY2017-18. Customers in the highest consumption tiers will be paying a higher price for power than its cost of production of EGP 0.97 per KW and the profit generated will be used partially to cover the subsidy for the lowest consumption bracket, Shaker had said previously.

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