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Government to discuss raising tariff on biofuel next week - Daily News Egypt

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Government to discuss raising tariff on biofuel next week

Committee suggests price ranging between EGP 1.02-1.08 per KW/h

The committee formed by the ministries of electricity and environment is set to present suggestions of raising the tariff for producing electricity from biofuel to the cabinet next week.

Government sources said that the committee proposed raising the tariff from EGP 0.92 per kilowatt per hour (KW/h) after liberalising the exchange rate, so as to encourage investment in electricity production from waste.

The source told Daily News Egypt that the committee suggests prices ranging between EGP 1.02-1.08 per KW/h to match the tariff of the renewable energy projects.

Moreover, the committee suggested payment to take place in Egyptian pounds and not link the tariff to the exchange rate, considering the continuous fluctuations of the rates. In addition, the committee suggested contracting with a legal consultant to phrase the wording of the power from waste purchase agreement.

The committee has been working on combining all related issues to producing electricity from waste, in cooperation between the ministries of electricity, environment, finance, local development and planning.

According to the committee’s suggestions, the Ministry of Electricity will bear between EGP 0.45-0.50 from the total tariff value, while the ministries of environment and local development would bear the remaining value.

The sources added that the committee proposed establishing a one-stop shop to deal with investors in the field of producing electricity from waste and providing facilities for the provision of lands required for the recycling factories with a usufruct system at fair compensation.

Furthermore, the committee recommended not sealing any deals except after finalising all regulations and controls and imposing them, especially as three companies have already submitted bids to implement projects with different capacities.

Minister of Electricity Mohamed Shaker told Daily News Egypt in earlier statements that the old tariff will be increased to stimulate investments in the field.

He added that the Ministry of Electricity is ready to buy any waste-produced electricity in coordination with the Ministry of Environment.

He noted that the ministry is seeking to diversify its sources of electricity production through renewable energy, coal, nuclear power projects, and hydro electricity.

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