The government will finalise regulations for the production and sale of electricity produced from new private and renewable power plants directly to consumers by September.
Government sources told Daily News Egypt that the ministry of electricity set up a committee to prepare standards, regulations, and rules governing the production of electricity from solar and wind stations and selling them to consumers through the independent power producer (IPP) scheme with payment of electricity network usage fees. Consumers shall have free access to electricity from any licensed company producing and selling energy.
The sources added that the committee consists of officials from the Egyptian Electricity Transmission Company, the Egyptian Electricity Holding Company, the Electricity Regulatory Authority(ERA), the New and Renewable Energy Authority, and experts in the field of electricity and energy, including Mohammad Salah Sobky and representatives from the private sector, such as Ahmed Zahran, CEO of KarmSolar.
The most prominent features of the rules that are currently being defined include the non-monopoly of any company for the production and selling activity, and that prices be negotiated between the executing companies and customers, to set the maximum and lowest tariffs which could go up and down, the sources pointed out.
Also according to the sources, the rules additionally include obtaining licenses to engage in the production and sale of electricity by the ERA. The licenses are limited in duration, the activities implemented, and the licenses obtained by the private sector annually.
According to the Electricity Law, each participant has the freedom to choose their own electricity supplier.
The competitive market for electricity is based on free competition and the qualified participant has the right to contract with the production companies or distributors approved through bilateral contracts to provide their electricity needs.
The laws open the market to the private sector. In addition, the sector will become more competitive as more companies enter the industry.
These measures are in the interest of subscribers because the consumer will have the freedom to choose the service, and private sector companies will compete to provide better and cheaper services, the sources said.
The investments of the projects submitted by private companies to the ministry of electricity for the launch of solar and wind stations and the sale of electricity produced directly to the factories and institutions reached about $3bn and are expected to be approved following the completion of the rules and regulations governing the projects.