Egypt’s Electricity and Renewable Energy Ministry said Friday that it will keep tariffs unchanged for the lowest household consumption bracket while raising rates for other residential customers by an average of 12%.
The ministry said it approved the new accounting tariff structure “in a bid to ensure the stability of power supply and the financial sustainability” of Egypt’s electricity and renewable energy network, which covers production, transmission and distribution across the country.
Subsidies shrink as consumption rises

Egypt spends roughly 100 billion pounds, or about $1.9 billion, each year to close the gap between the actual cost of producing electricity and what consumers pay for it. That subsidy shrinks as household consumption climbs, under a tiered system designed to protect the lowest-income users while gradually shifting more of the cost onto heavier consumers.
Under the current structure, customers using around 50 kilowatt-hours a month pay just 25% of the true cost of their electricity. That share rises to roughly 50% at 300 kWh of monthly usage, climbs further to around 60% at 500 to 600 kWh, and reaches 88% for households consuming between 700 and 1,000 kWh. Consumers using 2,000 kWh a month or more pay the full, unsubsidized cost of their electricity, according to the ministry.
By leaving the first bracket untouched, the ministry is shielding Egypt’s lowest-consuming households, generally its poorest, from the latest round of increases while asking wealthier and higher-consuming residential customers to absorb a larger share of the network’s costs.
Second increase this year
Friday’s announcement marks the second major electricity price adjustment in Egypt this year. In April, the government raised prices for higher-use residential consumers and commercial users by an average of 16% to 20%. Officials attributed that earlier increase to a global energy crisis linked to conflict in the Gulf region, which they said more than doubled the cost of Egypt’s energy imports.
Egypt, like many countries in the region, imports a significant share of the fuel needed to keep its power plants running, making its electricity costs highly sensitive to swings in global energy markets and regional instability.
Drone attack forced a costly fuel switch
The latest tariff increase comes after an unclaimed drone attack damaged one of Egypt’s four Floating Storage Regasification Units, facilities used to import and process liquefied natural gas for domestic power generation. The damage forced the government to shift toward more expensive fuel oil to keep the grid running, a costly substitution that came at an especially difficult time.
The switch occurred just as Egypt was approaching peak summer electricity demand, which the ministry said reached roughly 37 to 39 gigawatts. Summer months typically bring the country’s highest electricity consumption, driven largely by widespread use of air conditioning during extreme heat, putting additional strain on a grid already working to absorb the loss of one of its regasification units.
Balancing affordability and network stability
Egyptian officials have repeatedly framed electricity tariff adjustments as necessary steps to keep the country’s power network financially sustainable, even as they try to shield the most vulnerable households from the full impact of rising costs. The tiered subsidy system allows the government to raise revenue from wealthier, higher-consumption households while keeping basic electricity access affordable for lower-income Egyptians.
The ministry did not specify exactly how much additional revenue the 12% average increase is expected to generate, nor did it detail how the funds will be allocated across the production, transmission and distribution segments of the network it oversees.
What comes next
With Egypt’s subsidy burden tied closely to global energy prices and regional security conditions, further tariff adjustments could follow if import costs continue to rise or if additional infrastructure, such as the damaged regasification unit, requires costly repairs or replacement fuel sourcing. The ministry has not indicated when the fourth Floating Storage Regasification Unit might return to service, leaving open the possibility that Egypt will continue relying on more expensive fuel oil through the remainder of the peak summer demand period.
For now, Friday’s decision leaves Egypt’s lowest-consumption households paying the same rates as before, while placing a heavier financial burden on the majority of residential customers who fall into higher consumption brackets.












