Thursday, September 4, 2014

Letters from Egypt: Rolling Blackouts and Why

Uff – it’s bad. It’s the worst power outages that we’ve faced so far.

There are rolling blackouts throughout Cairo with reports of the same in Aswan; however, my contacts in Alexandria say they remain unaffected. In addition to the electricity problems, many areas are also facing water shortages (parts of Maadi and Heliopolis have been confirmed).

The Electricity Minister Ahmed Shaker told ONTV channel that the massive outage was due to technical problems. The Egyptian Electric Holding Co. (EEHC) said that at 6:15 am, a technical malfunction took place at a 500-kilowatt (kW) power transformer station. However, my first outage began at 1 am. Another friend located nearby had a power outage at 5 am. And many of us woke up around 7 am in a pool of sweat continuing without power for over two hours. These times were long before the so-called “technical malfunction”. In addition, it’s important to note that 500 kW is nothing compared to the power generated by other stations like West Cairo power station at 300 megawatts (MW) and Cairo North II generating 750 MW.

I’ve written a blog before on why Egypt is facing the power crisis. Some of you may think that it’s a result from instability and other economic downturns since the 2011 revolution, but that isn’t true. First of all, Egypt generates 86% of its power via natural gas – which newsflash, is in short supply. Even in 2010, the country faced a natural gas growth rate estimated at about 8% annually with locally produced natural gas only coming in at 6% annually. This is coupled with fuel subsidies that were a drain on the economy all the way around. Despite the government’s recent move to decrease the fuel subsidies, it will take a while to correct the problem that was growing even during the Mubarak era.

Read my previous blog to get some more insight into Egypt’s power generation sector, and also, here is one of the best articles I’ve read from an Egyptian on the subject: “Why We Need Price Hikes”. The only problem with his article is that Egypt’s problem doesn’t derive from a need to expand the national grid. It results mainly from the inability for its natural gas supplies to meet local demand (as well as its inability to diversify and use different feedstock for power generation).

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