AMMAN - Electricity prices are expected to rise as of September 1, but no official decision has yet been made in this regard, Electricity Regulatory Commission (ERC) Chief Commissioner Suleiman Hafez said.
Hafez told The Jordan Times that the plan to increase the electricity tariffs is mainly due to the increase in fuel prices, adding that the decision is still under discussion between the government and the commission.
"Although natural gas, including that imported from Egypt, represents 80 per cent of the energy resources needed for electricity production, electricity generation in Jordan is also linked to oil prices," he noted.
The ERC chief indicated that the commission has two choices: Either to reduce generating capacity or to operate generating units on fuel oil, resulting in a price increase. "Fuel oil is costly and we cannot reduce generating capacity," Hafez said.
The rise in electricity prices on end-users will basically help address a widening deficit at the National Electric Power Company (NEPCO).
In a report earlier this month, NEPCO's Director General Ahmad Hiyasat said his company is struggling with a JD50 million budget deficit that has forced the company to postpone several projects.
During an interview with the Jordan News Agency, Petra, Minister of Energy and Mineral Resources Khaldoun Qteishat said the ERC was considering alternatives to the current pricing system.
The idea under consideration, Hafez said, is to update electricity tariffs every three months according to fluctuations on the international oil market. This means that if international oil prices go down, electricity tariffs will also decrease, he said.
According to the ERC chief, a large slice of consumers will not be affected by the new pricing plan if adopted.
He said that the price update will exclude those subscribers who consume 160 kilowatts (kW) or less per month. These constitute 27 per cent of total subscribers to the service.
Meanwhile, those that consume between 160kW and 230kW, with an average bill of JD10 will have to pay a total of JD0.70 in additional cost under the new tariffs.
Meanwhile, the category that consumes between 230-400kW, with a current bill of around JD27, will be charged an additional JD1.2, while those using between 400-750kW will pay an extra JD2, according to Hafez.
The ERC commissioner indicated that the increase in electricity prices will curb energy consumption, which will be in the interest of the Kingdom's economy as it will reduce imports of oil and electricity generating units.
By Omar Obeidat
© Jordan Times 2009
