Egyptian households and businesses are bracing for a spike in electricity prices, with a new government proposal set to raise rates by more than 25% across most consumption brackets starting October.
A source familiar with the plan told Al Manassa that the Ministry of Electricity has finalized a sweeping restructuring strategy aimed at easing the strain of energy subsidies on the country’s battered public finances.
The proposal will be submitted to the Cabinet within weeks for approval, the source said, requesting anonymity given the high sensitivity of the file.
“The Cabinet will decide the final date of the announcement,” the source said. “The decision carries enormous political risk, with direct repercussions on citizens and productive sectors.”
Austerity returns
The move follows the formation of a government committee in July to study electricity pricing, with an eye on scrapping subsidies altogether in the next fiscal year.
Previous attempts to dismantle energy subsidies were delayed by the COVID-19 pandemic and the economic fallout from Russia’s invasion of Ukraine—a crisis that left Egypt reeling from skyrocketing energy import bills. In July of this year, the Egyptian government rolled back on its earlier decision to freeze electricity price hikes until 2026. At the time, analyst projections saw tariff increases to be between 30%-50%.
“The government cannot afford to postpone again,” the source said. “It costs roughly 257 piastres to produce one kilowatt-hour, while the lowest residential tier pays only 68 piastres.” Industrial usage is charged at a flat rate of EGP 2.33 per kWh.
Egypt’s energy balance sheet has grown alarmingly fragile in recent months. Monthly fuel bills from the Ministry of Petroleum have soared beyond 20 billion Egyptian pounds, driven by costly liquefied natural gas imports to feed power plants. The Finance Ministry allocated 75 billion pounds in additional subsidies for the sector this fiscal year, but the source said real costs have blown past projections.
Tariffs by category set by the Electricity Utility and Consumer Protection Agency for FY 2024/2025(*)
| Residential Consumption Range (kWh) |
Residential Tariff (EGP/kWh) |
Commercial Consumption Range (kWh) |
Commercial Tariff (EGP/kWh) |
|---|
| 0–50 |
0.68 |
0–100 |
0.85 |
| 51–100 |
0.78 |
101–250 |
1.68 |
| 101–200 |
0.95 |
251–600 |
2.20 |
| 201–350 |
1.55 |
601–1000 |
2.27 |
| 351–650 |
1.95 |
>1000 |
2.33 |
| 651–1000 |
2.10 |
— |
— |
| >1000 |
2.30 |
— |
— |
Impact on households and industry
Energy expert Medhat Youssef warned that the government faces a perilous balancing act between fiscal discipline and social protection.
“The real test lies in shielding low-income families while cutting pressure on the state budget,” he told Al Manassa. He predicted that the hikes would be paired with targeted but limited social safety nets for the most vulnerable groups.
Youssef added that higher tariffs will hammer high-consumption households and heavy industries such as steel, cement, and chemicals. “These sectors will absorb steep operational cost increases, which will inevitably push up consumer prices,” he said.
If approved, the hikes will mark Egypt’s steepest electricity increase in years, tightening the squeeze on households and industries already reeling from inflation and austerity.
