Gov’t extends timeline to privatize electricity sector by two years
CABINET WATCH- Gov’t extends timeline to privatize electricity sector by two years: The Madbouly Cabinet has extended by two years the timeline of the state’s transition from sole player in the electricity market to a regulator, while separating power generation from transmission and distribution, according to a cabinet statement on Thursday. The original 2015 bill had given the state’s electricity companies eight years to complete the transition to market regulator by 2023. This will now be extended to 2025.
Step #1: Lots of work for consultants and lawyers. The only specific changes named in the statements are instructions for the Egypitan Electricity Holding Company (EEHC) and the Egyptian Electricity Transmission Company (EETC) to untangle joint assets and subsidiaries among themselves, so that the EETC can be restructured as the market regulator, Electricity Ministry spokesman Ayman Hamza told Enterprise. For example, EEHC had obtained loans in the past before the EETC became an independent company, so these loans will have to be restructured to be paid by the EETC instead of EEHC. Both companies would then have to prepare studies on the sector’s project pipeline in generation and transmission, including the timeline for implementing the grid interconnection projects with our neighbors. The EETC had been made an independent authority ahead of its designation as the market regulator.
A host of changes are coming to the electricity sector as part of the long-term vision of privatizing it, as we noted in the most recent Hardhat. This involves getting the ball rolling on our export of electricity and reworking the pipeline of electricity projects to relieve the electricity capacity glut that is hindering private sector expansion. New contracting frameworks will be implemented and tenders will be offered to the private sector across the entire value chain of electricity.
In other cabinet news: Ministers approved draft legislation to establish a new agency for administering repatriated funds that would be chaired by the finance minister. The new agency would be the sole administrator of all funds repatriated to the state, including funds seized per court rulings.