Why is Jordan’s electricity bill so exorbitantly high?

(File photo: Jordan News)
AMMAN — According to a report by the website Global Petrol Prices, Jordan pays the second-highest price for electricity among Arab countries. However, the Kingdom is considered a regional leader in the field of renewable energy — drawing 20 percent of its grid power from the sun and the wind. So why is the Kingdom’s electricity bill so disproportionately high? اضافة اعلان

According to experts in the field of energy, Jordanian citizens bear the brunt of “unfair” contracts signed in the past between the government and renewable energy companies, which set “very high prices” for power, without any stipulations on the periodic review of those agreements and prices, Jo24 reported.

While these contracts are the number-one reason for the high cost of electricity in Jordan, secondary factors that contribute to the problem include poor planning and management, and a high rate of electric waste, with upper estimates placing losses in the range of 20 percent of total electricity flow.

The promise of interconnectivityHowever, the situation is not hopeless. According to the experts, interconnectivity and energy export projects with Iraq, Syria, and Lebanon could contribute to reducing electricity costs in the future, along with the forthcoming expiry of some government agreements with traditional and renewable electricity companies.
A continued rise in electricity prices could cause deep damage to the Kingdom’s economy in other areas, weakening its ability to attract investments
Energy expert Amer Al-Shobaki attributed the Kingdom’s high electrical tariff to the “exorbitant” cost of renewable energy contracts, in addition to electrical losses estimated between 13 and 20 percent — “a high percentage compared to other countries”.

In Jordan, the average price of one kilowatt ranges between 11 and 12 piasters, one of the highest prices per kilowatt in the Arab world, he noted.

“That is why we are witnessing very high electricity prices in the Kingdom that do not match the income of citizens,” Shobaki said.

The sweeping impact of electricity costsSince 2016, electricity prices have been continually rising, with no signs of the trend letting up in the near future, he noted. However, a continued rise in electricity prices could cause deep damage to the Kingdom’s economy in other areas, weakening its ability to attract investments, as energy prices often create an obstacle to investment, the expert said.

Energy expert Hashem Aqel called the agreements reached with renewable energy companies “very unfair”, and said they have led to “exaggerated” prices.

However, the Ministry of Energy has begun negotiating with renewable energy companies to reconsider these prices, Aqel said.

Furthermore, electricity tariffs have been reduced in the agricultural, commercial, and hotel sectors by 16 percent, the expert noted, urging similar measures for domestic energy bills.

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