Egypt - Minister of Electricity and Renewable Energy Mohamed Shaker told Daily News Egypt that his ministry is committed to the plan to restructure electricity prices until 2025, and electricity prices are still subsidised by the state, taking into account low-income groups and families in need.

He added that in 2025, the electricity sector will have reached the real cost of the value of electricity, as all subsidies on power will be removed by then. Instead, there will be reciprocal support from heavy consumers for low-income citizens.

Shaker explained that during its deliberation over the value of the electricity tariff over the past five years, the ministry took into account many issues and variables that might occur. Moreover, the tariff is gradually increasing without affecting beneficiaries. Additionally, subsidies will be extended to 2025 to reduce the burdens on consumers.

He also mentioned that the fuel supplied to electricity production plants is subsidised by the state. The estimated volume of subsidies for electricity during the next five years is estimated at EGP 76bn.

Furthermore, the minister said that there is absolute transparency in the electricity tariffs and price increases, and that the average price of electric energy at all levels is still lower than the real cost.

Additionally, Shaker stressed that the subsidisation of energy prices in Egypt is one of the highest rates in the world, and that the state is committed to supporting the groups in need even after the liberalisation of electricity prices.

He also stated that President Abdel Fattah Al-Sisi’s directives always focus on not burdening citizens with additional worries and taking low-income groups into consideration, and that the electricity sector is deepening the culture of rationalisation and providing mechanisms that help citizens with the aim of maintaining balanced bills for all segments.

The minister pointed out that the Egyptian Electric Utility and Consumer Protection Regulatory Agency (ERA) carried out an economic study of the kilowatt production costs. This study was presented to the Cabinet, which approved it to reduce subsidies among kilowatt production costs.

In terms of subsidies for low-income people in society, no consumer spends on electricity more than 4% of their expenditure, according to the study of income and expenditures issued by the Central Agency for Public Mobilisation and Statistics (CAPMAS).

“Impoverished groups spend 1% and low-income groups spend 2%,” according to the study.

The annual increase in the electricity bill was determined on the basis of the percentage of what consumers can bear, which called for relying on indicators of income, expenditures, and consumption.

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