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Thursday, 9 June 2022

More inflation coming our way

Could household electricity bills rise from 1 July? Households could see their electricity bills rise by as much as 21% from 1 July, according to the government’s 2020 schedule (pdf) to phase out subsidies by 2025. According to the schedule, hikes in some unsubsidized consumption tiers will see other households pay as much as 6% more.

We’ve yet to hear of any official confirmation that this will go down, but sources we’ve spoken with tell us that this is likely to happen.

REMEMBER- Subsidies were fully lifted for households who consume more than 650 KWh/month in FY 2020-2021.)

Some businesses will also see a small increase as the rate on the 0-250 KWh band rises 2.5% to EGP 1.23/KWh. All other tiers will remain frozen at current rates through FY 2022-2023.

The new tariff for subsidized households:

  • The first 0-50 KWh/month will be charged EGP 0.58/KWh, up 21%. Households in this tier will pay up to EGP 29 a month;
  • The next 51-100 KWh/month at EGP 0.68 / KWh, up 17%. Households in this tier will pay up to EGP 63 a month;
  • The next 101-200 KWh/month at EGP 0.83 / KWh, up 8%. Households in this tier will pay up to EGP 146 a month;
  • The next 201-350 KWh/month at EGP 1.11 / KWh, up 5%. Households in this tier will pay up to EGP 312.5 a month;
  • The next 351-650 KWh/month at EGP 1.31 / KWh, up 2%. Households in this tier will pay up to EGP 771 a month.

Some unsubsidized households will also see prices rise: Those consuming 651-999 KWh a month will be charged a flat rate of EGP 1.36/ KWh on their entire usage, up from EGP 1.28 currently. Households using this much energy are expected to be charged up to EGP 1,359 a month (based on an average consumption rate measured by the government), up from EGP 1,279 in the current fiscal year. Those consuming more than 1,000 KWh per month will continue to be charged the same EGP 1.45 / KWh rate.

Subsidies will be fully lifted by 2025: The government will continue to gradually withdraw subsidies over the next three years, according to a new timetable (pdf) mapped out by the Electricity Ministry in 2019.

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