Egypt's Ministry of Electricity and Renewable Energy announced a tariff adjustment on Friday, keeping the lowest household consumption bracket unchanged while increasing rates for other residential users by an average of 12%.
The ministry emphasized that the move aims to maintain a stable power supply and ensure the financial sustainability of the country’s electricity network, which includes production, transmission, and distribution.
Subsidy Structure and Consumption
- Households consuming up to 50 kWh per month pay about 25% of the actual cost.
- At 300 kWh, consumers cover around 50% of their electricity cost.
- Usage between 500 and 600 kWh leads to approximately 60% payment of the cost.
- For consumption between 700 and 1,000 kWh, households pay 88% of the cost.
- Users consuming 2,000 kWh or more bear the full cost without subsidies.
Egypt currently subsidizes roughly 100 billion Egyptian pounds (about $1.9 billion) annually to bridge the gap between electricity production costs and consumer tariffs. The subsidy share decreases as household consumption rises.
Context of the Increase
This tariff revision follows a previous increase in April, when electricity prices for higher-use residential and commercial consumers rose by 16-20%. The earlier hike was driven by a global energy crisis linked to regional conflicts that more than doubled Egypt’s energy import bill.
Additionally, a recent unclaimed drone attack damaged one of Egypt's four Floating Storage Regasification Units (FSRUs), forcing a temporary switch to more expensive fuel oil amid peak summer demand estimated between 37 and 39 gigawatts.
