Why a gas shortage becomes a blackout in your living room

The lights go out, and the explanation comes back: there isn’t enough gas. You’ve heard that enough that the connection barely needs explaining. But somewhere between charging your phone and waiting for the air conditioner to come back, there’s a question worth asking: how did gas become the thing so much of the country’s electricity depends on — and why can’t we just burn something else?

Trace the electricity back and you reach a decades-old choice: build the grid around Egypt’s own gas. That made sense until dwindling production showed how quickly trouble in a gas field could become a blackout at home.

A power plant is an expensive thing to leave hungry: Egypt had some 59.7 GW of installed generating capacity in June 2024, yet households were still organizing their days around power cuts. That month, the government put a USD 1.18 bn price tag on the gas and mazut imports needed to end the outages. Prime Minister Mostafa Madbouly said Egypt had sufficient generating capacity and network infrastructure, but lacked fuel to meet demand.

Four-fifths of what keeps your light on is one fuel. Natural gas accounted for 79.1% of the fuel consumed by the power plants covered in the Egyptian Electricity Holding Company’s (EEHC) FY 2024/25 report, measured in oil-equivalent terms, down from 83.7% in FY 2023/24. That means roughly four-fifths of the system’s fuel came from gas.

BACKGROUND- Residential consumption accounted for 38.9% of electricity used in May, followed by industry at 27.3%, according to the Capmas bulletin (pdf). Together, the two sectors accounted for roughly two-thirds of electricity use, putting homes and factories at the center of the country’s power needs.

How gas got the job

The relationship predates Zohr by decades: Gas discoveries in the 1990s and 2000s drove Egypt to expand domestic gas use while developing pipeline and LNG exports, according to the World Bank. By 2014, power generation consumed 57% of domestic gas, while gas made up roughly three-quarters of proven petroleum reserves in oil-equivalent terms. Building around gas was therefore a way to turn a major domestic resource into electricity while reducing fuel imports.

The trick is burning the same gas twice. Combined-cycle stations accounted for some 53% of the country’s installed generating capacity at end-June 2025, but supplied almost 67% of its electricity during the fiscal year, according to the EEHC. These plants burn gas to drive a turbine, then capture its exhaust heat to produce steam and drive another — generating additional electricity from heat that would otherwise go to waste.

Odds are one of three plants made your electricity today. Siemens and its partners completed the 14.4 GW Beni Suef, Burullus, and New Capital plants in 2018, listing their net efficiency at more than 60%. More efficient generation meant less fuel needed for each unit of electricity — a useful investment in a country already struggling to keep its power stations supplied. The three plants alone supplied roughly one-third of Egypt’s electricity in FY 2024/25.

The timing matters: The main Siemens agreement was signed in June 2015, almost three months before Eni announced Zohr’s discovery. The field began production in December 2017, shortly before the three plants were completed. Zohr supplied the expanding gas system, but it did not cause the decision to build the plants.

Those plants are now being fed by imports: “While Egypt will very likely procure more LNG during summer as compared to winter and the shoulder seasons, LNG will also continue being utilized as a baseload fuel for the foreseeable future,” JP Lacouture, analyst at Kpler, tells EnterpriseAM, adding that using LNG in the power sector lets Egypt lean more heavily on its newer, more efficient combined-cycle gas turbines, displacing fuel oil and diesel in less efficient plants. The fuel source changed; the machinery it was built for didn't.

Cheap power had a price

ZOOMING OUT- The cheap electricity you grew up with was never actually cheap. For decades, Egypt used energy subsidies as a form of social protection and wealth sharing, Irena notes. Those prices also encouraged consumption and increased the fiscal burden — cheap electricity for the customer did not mean cheap electricity for the state. The EEHC documents repeated postponements of scheduled electricity-tariff increases to ease the economic burden on citizens.

The warning signs predate the latest shortages: Irena links Egypt’s 2014 blackouts to fuel shortages, infrastructure constraints and rising demand. The response included leasing FSRUs and adding generation. As gas production declined from its 2021 peak, more of the fuel needed to run those plants has had to come from abroad.

Before it reaches your socket, that gas crosses an ocean as a liquid. Import dependence has a physical and financial chain: LNG moves from tanker to FSRU to the gas grid and power plant, with Egypt’s four FSRUs linking imports to the domestic power system. Financially, EEHC said rising liabilities to petroleum suppliers drove up its liabilities-to-equity ratio in FY2024/25.

Why not just burn mazut?

We already do: Egypt's power plants consumed 7.49 mn tons of heavy fuel oil in FY 2024/25, up almost 30% y-o-y from 5.74 mn tons. Diesel consumption jumped roughly 152% to 253k tons. Gas remained the dominant fuel, but the system was burning considerably more mazut.

The switch has been a deliberate money-maker: In 2022, the government increased mazut use to freeup more gas for export as Europe sought alternatives to Russian supplies. The economics favored burning cheaper fuel oil at home and selling gas abroad, helping bring in scarce foreign currency. Mazut is therefore more than an emergency fallback — and gas is not invariably the cheaper choice.

SOUND SMART- A turbine is more like a car than a stove: it runs on the fuel it was built for. “Oil” isn’t one interchangeable fuel — diesel, heavy fuel oil and crude have different properties, and a plant designed for one may not burn another.

Crude is the least useful of the three: More oil production does not solve a gas shortage because most power plants cannot simply switch from gas to crude. Any oil-based backup requires the right refined fuel and compatible generating equipment. And Egypt is already a net crude importer, so burning more diesel or mazut would shift the import burden rather than remove it.

How the shortage reaches your socket

The grid has no warehouse. What you use has to be made the second you use it. A fuel shortage becomes a power shortage when the system cannot cover the gap. Electricity supply must match demand to keep the grid stable. If less fuel means less generation, and alternative supplies cannot make up the difference, demand has to fall — voluntarily or through power cuts. Spare generating equipment cannot solve that imbalance without something to run on.

The spare capacity you'd hope is sitting there is thinner than it looks: EEHC recorded 60.8 GW of installed capacity and a 38 GW peak load in FY 2024/25. Installed capacity measures the size of the generating fleet, but how much it can actually deliver depends on fuel supplies and the availability of its equipment. This August, peak demand passed 40 GW, around 2 GW above the peak in FY 2024/25.

The next job is to need less gas for the same electricity service: Egypt’s EBRD-backed NWFE program aims to retire 5 GW of inefficient fossil-fuel capacity and support 10 GW of renewables by 2028 alongside grid investment. That approach tackles fuel consumption as well as generating capacity. Additional wind and solar can reduce the amount of gas that needs to be bought and burned, while grid upgrades and flexibility help integrate their output.

A power system is judged on what it delivers on its worst day, not its best. The bottom line is that Egypt’s gas hedge delivered large amounts of efficient generating capacity. Its weakness, however, is the continuing obligation to feed it. The measure of a secure power system is how much electricity it can reliably deliver when domestic production falls, an import route closes, or the fuel bill jumps.