Egypt raises electricity prices for mid-to-high household usage

Reuters , Thursday 30 Jul 2015

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Egypt's electricity minister Mohamed Shaker (Photo:Ahram)

Egypt raised electricity prices on Thursday for mid-to-high household usage by an average of 19 percent for the 2015/2016 fiscal year, the electricity ministry said on Thursday.

The government began raising electricity prices last year as part of a five-year plan to reduce subsidies.

Low-end household consumption was not affected by the latest rises.

Mid-level household usage was the most affected by the latest price increases, with prices for consumption in the range of 201-350 kilowatt hour (kWh) per month rising by just over 27 percent. Household consumption in the three next highest bands rose by 19, 18, and 13.5 percent respectively.

Egypt is trying to repair its finances while weaning the population off a decades-old subsidy regime that often benefited the country's highest income earners.

Artificially low energy prices mean that government appeals to conserve electricity have gone unheeded. A shortage of natural gas, which is used by Egypt's power stations to generate electricity, has led to a rationing of gas supplies for much of the country's domestic industry, sometimes crippling production.

The government slashed energy subsidies in July last year, raising energy costs by up to 78 percent.

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