The Electricity Rates revised – What would be the impact on your bill?

Rise in the rates, the problem we are facing worldwide, in every country almost. Inflation, demand and supply factors and a shortage of reserves are the main factors behind the rise in prices of daily routine utilities. One such basic and utmost important utility is electricity.

Saudi Arabia is rich in oil, with numerous oil wells across the Kingdom and the Government always giving the best of the products in cheap rates like petrol, electricity made from oil and lower rates of tax, now the rise in the prices of electricity is something that shook the citizens..

People of Saudi Arabia were said to be lucky because they were enjoying cheapest rates of many resources like petrol, diesel, and electricity as compared to other countries of the world. But now with the start of 2018, they will also have to face the trauma of electricity bills because electricity tariff is going to increase.

On Tuesday the Electricity and Cogeneration Regulatory Authority (ECRA) announced that The Council of Ministers has approved the gradual revision of energy prices in the Kingdom including changes to electricity prices from January 1. 2018.

The following rates of electricity will continue to apply in Saudi Arabia till Dec 31, 2017. We have provided them with the below figure.

It was announced that residential electricity consumption of 1 – 6000 KW/h per month will cost 18 halalas KW/h, and if the electricity consumption will increase 6000 KW/h per month it will cost 30 halalas KW/h.

For commercial consumption of electricity, the rates were different. It will cost 20 halalas KW/h for electricity consumption of 1 -6000 KW/h and the rates will increase if the consumption will rise above 6000KW/h per, it will cost 30 halals KW/h.

For agriculture use or non-profit organizations, foundations, charities, electricity consumption will cost 16 halalas KW/h for 1-6000 consumption KW/h per month. And 20 halalas KW/h for above 6000 KW/h per month.

The Electricity consumption rates for private healthcare institutions, education institutes, and private schools will be 21 halalas KW/h. The rates for industrial is 18 halalas KW/h and for government use, it will be 32 halalas KW/h.

According to ECRA, the step taken will help to raise economic efficiency and it will help to build up Kingdom’s non-oil sectors. It will also help to rationalize the consumption of natural resources for future and will support to the most deserving beneficiaries through the citizen’s account program.

 ECRA confirmed that they have designed new tariff of electricity just to cover the cost of services they provide, and promised to supply sustainable electricity throughout the Kingdom, improve the quality of service and increase its productivity for the Kingdom which will open a field for competition.

Electricity and Cogeneration Regulatory Authority (ECRA) is working with Saudi Electricity Company (SEC) and the Power and Water Utility Company for Jubail and Yanbu (MARAFIQ) to modify the billing system.

As per new tariff those who were paying SR50 for 1,000 KW/h, they will have to pay SR180. Similarly, if you increase electricity consumption to 6000 the bill will increase from SR700 to SR 1,080. 

Source: Saudi Gazette

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