Electricity tariffs to go up as crude oil prices soar

AMMAN — Electricity prices will be increased as of Thursday for all sectors and segments, excluding households that consume 300 kilowatt-hours (kWh) and less per month, an official said Wednesday.

Price of kWh will increase from 12 to 14 fils on all sectors as of March 1st until the end of the month, Farouq Hiyari, chief commissioner of the Energy and Minerals Regulatory Commission told The Jordan Times on Wednesday, attributing the decision to the hike in prices of crude oil over the past three months.

The average price of a crude oil barrel in February, January and December of last year rose to $66.2 per barrel, exceeding the $55 cap set by the government to keep electricity tariffs unchanged, he said over the phone. 

Electricity prices are announced at the end of each month and are based on the average price of crude oil over the previous three months, according to Hiyari.

"The increase will affect all economic sectors, including the industrial and households. But households that consume 300 kWh or less will not see any increase in their bills," the official said.

The move has a downside, according to a leading unionist. 

Fathalla Emrani, president of the Textile, Garment and Clothes Union, warned against repeated increases in prices of electricity, and its impact on the garment and textile sector in particular that consumes electricity heavily.

The sector employs around 72,000 workers of whom around 18,000 are Jordanians, and any increase in the prices of electricity will have a negative impact, he said.

“Early February, a factory shut down and laid off more than 300 Jordanian employees due to an increase in cost of production driven by high prices of fuel and electricity,” Emrani told The Jordan Times on Wednesday.

Increasing prices of electricity will reduce the competitiveness of the industrial sector, he said.

“I do not believe that increasing the prices of electricity will help in attracting investments into the country,” Emrani said Wednesday.