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Electricity bills will rise this summer: The government will hike electricity prices in July with the beginning of the new fiscal year, a government source told Enterprise yesterday. The percentage increase will depend on each household or business’ consumption, with the lowest consumption segments seeing the smallest jump in prices.
How much are we talking? On average, the hikes will exceed 20%, but studies and discussions are still underway to determine the new prices, the source said, adding that studies are also underway regarding the price of electricity for factories and other industries.
Aligned to the IMF agreement: The Madbouly government has committed to continue reducing energy subsidies and “to better target the resources that are going to households which need additional income support,” under its expanded loan agreement with the IMF.
And part of the state’s privatization push: Cutting down on electricity subsidies is part of the state’s efforts to attract more private sector investments into the electricity sector, the source added.
Madbouly let us know this was coming: The news follows statements from Prime Minister Moustafa Madbouly on Monday that hinted at the government raising the prices of electricity. He said Electricity Minister Mohamed Shaker will prepare a plan as to how the government can completely cut its spending on electricity subsidies over the coming four years.
The cost of electricity production has soared, becoming more of a burden on the state budget, especially after a dip in domestic natural gas production pushed the country from being a net exporter to a net importer of LNG in the recent months.
Electricity subsidies are on the way out: The Madbouly government in 2020 laid out aroadmap to phase out subsidies by 2025 — pushing back an existing July 2022 deadline that was already an extension of a 2019 deadline penciled in way back in 2014.
Remember: The Electricity Ministry last hiked prices in January, pushing electricity prices for households and businesses up 16-26%.
