Egypt's Minister of Electricity and Renewable Energy Mohamed Shaker told MPs that a new cut in electricity subsidies will be introduced in July.
“This means that there will be an increase in electricity bills in July and as part of a five-year subsidy cut programme in this sector,” said Shaker, adding that “let me say that I am the first cabinet minister who decided to announce this step in public.”
In a meeting with parliament’s industry committee, Shaker said that “despite the repeated cuts that have been introduced since 2015, electricity prices in Egypt are still below the international rates.”
Shaker said that “the Ministry of Electricity still owes the Ministry of Petroleum a staggering amount of EGP 145 billion worth of fuel supplies, and if electricity subsidies are kept in place in the new fiscal year, the deficit of the ministry’s budget will increase by EGP 36 billion.”
Shaker said the subsidies allocated to the Ministry of Electricity this year will be cut down to just EGP 16 billion.
"This comes at a time when we have to pay EGP 20 billion in debts in the new year," said Shaker, "so electricity prices must go up, not to mention that we all agree that all subsidies in this respect should be completely phased out by the end of 2022."
Meanwhile, parliament's energy committee approved on Monday the budget of the National Authority for Electric Generation.
"The budget is estimated at EGP 6.2 billion, compared to EGP 5.7 billion last year, and this increase comes to help the authority implement a number of projects, particularly the new nuclear power generation station at Al-Dabaa west of Alexandria," said committee chairman Talaat El-Sewedy.
Mahmoud Khalil, the representative of the authority, told MPs that the actual construction of Al-Dabaa station will kick off in 2020.
"The review of the station's contracts and designs usually take from one year to one year-and-a-half, and I can assure that the progress in the Al-Dabaa project in coordination with the Russians is going according to schedule and without any deviations," said Khalil.