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Egypt Amplifies Household Electricity Costs by 50% Amid Economic Reforms

Wednesday 21 August 2024 - 12:10
Egypt Amplifies Household Electricity Costs by 50% Amid Economic Reforms

Egypt has implemented a significant increase in electricity prices for households, with rates soaring up to 50%, according to government sources. This move is part of a broader strategy to phase out subsidies, aligning with an agreement with the International Monetary Fund (IMF).

The electricity ministry confirmed that the new pricing took effect last Saturday for prepaid meters and will extend to regular meters on October 1. The increments vary from 14.45% to 50%, reflecting different consumption tiers.

Originally scheduled for earlier in the summer, the price hike was postponed due to severe power shortages, exacerbated by heightened cooling demands. To maintain grid stability, Egypt resorted to load-shedding and announced plans to import approximately $1.18 billion worth of natural gas and mazut fuel oil. The country predominantly relies on natural gas for electricity generation.

The petroleum ministry reported the arrival of five LNG cargoes, part of a 21-cargo agreement, with Prime Minister Mostafa Madbouly later declaring the end of power cuts for the summer. Egypt’s commitment to reducing energy subsidies aligns with its expanded $8 billion IMF loan program, though previous electricity price increases were delayed due to economic challenges.

Energy policy researcher Mark Ayoub highlighted that President Sisi continues to urge citizens to endure the economic strains. The ongoing electricity crisis has prompted adjustments in daily schedules to cope with frequent outages, impacting street lighting and public safety, particularly for women and vulnerable groups.

This latest development underscores Egypt's efforts to balance fiscal responsibility with public welfare amidst a challenging economic landscape.


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