Wednesday, May 23, 2012

Letters from Egypt: Power Outages amid Elections

Ataka Thermal Power Plant, Source: ECG Engineering
Many Cairo residents (estimated at over 50%) were left in the dark yesterday from 5pm-8pm after experiencing repeated power cuts throughout the day as a result of a gas shortage.

Whenever I explain this, everyone says: “What does gas have to do with the power cuts?” Actually, Egypt’s electricity is mostly fueled by natural gas making up 86% of the country’s electricity generation. Egypt has a great deal of hydrocarbon resources (fossil fuels) making it one of Africa’s top five producing nations, and with more discoveries, natural gas is predicted to be the “primary growth engine of the country’s energy sector for the foreseeable future,” according to the US Energy Information Administration. In fact, natural gas is the main source of energy for 32 power stations in Egypt.

I won’t bore you with the major power plants, electricity generation capacity, etc., but I’m sure many of you are aware of the repeated attacks that have occurred on pipelines transporting gas to Israel and Jordan. However, the gas issue is not something new to Egypt nor is it solely focused on sending exports to others (so don’t get your panties in a wad people and yet again blame Israel). Even prior to Mubarak’s ousting, the country faced this dilemma. In 2009, gas exports were on the rise; however, due to an increase in domestic consumption a moratorium was placed on new export contracts and the country’s exports have decreased steadily since.

It should be noted that at the same time Egypt is experiencing power cuts, the government resumed natural gas exports through the Arab Gas Pipeline to Jordan. While the exports to Jordan are not as high as they once were, the gas leaving the country could have a negative impact on many residents and even see retaliation as a result. It’s rumored that repeated power outages will continue over the upcoming days and speculation continues to mount as to the timing of the unorganized load shedding (scheduled power outages to help meet local demand) amid presidential elections.

Many African countries face the problem with electrification, and many lesser developed countries practice load shedding. What is interesting is that Egypt did not rotate the neighborhoods during the power outage, give any warning prior and it was only in Cairo. So this parlays even more as to the motives of the ruling military junta just before election polls open. Egypt has continued to have a problem with gas, and unfortunately massive power cuts in the business center of the country will continue to plummet the economy and discord among residents.

Without reliable electricity, you will see a trickledown effect occur. For example once the power came back on yesterday, residents rushed to the gas stations to fuel up among growing concerns of more cuts to come(gas pumps are inoperable during power outages). Creating panic at the pump will result in gas stations running out of the product (like banks plummeting in the US and people withdrawing all their funds which causes the entire banking system to suffer). Businesses lost revenue, particularly restaurants which do a decent amount of service during those hours. Furthermore, with the country’s economic downturn after the revolution, the only new places/shops you will find opening are new eateries (despite how bad it is, everyone still needs to eat), large corporate conglomerations (like Speedo and Converse taking over local businesses unable to survive) and Chinese shops (because they go everywhere – especially seizing the moment when a country is in trouble and Westerners are pulling out). Look at the rest of Africa and the main reason for its lack in economic progression: electricity. However, Egypt is one of the most advanced with over 95% of its residents having access to electricity (unlike the most populated country in Africa, Nigeria, with less than 40% of its total population having access).

My advice is to keep the flashlight near, candles on standby and charge up that iPad/laptop/tablet. Prepare for some darkness or at least annoyances like a child playing with the light switch – on/off, on/off, on/off. And also prepare for the results of the so-called “democratically” held elections to take a turn for the worse and more demonstrations to ensue. As most Egyptians are uncertain as to whom they want as the president, factions opposing the winner (whomever that may be) will arise in addition to more Tahrir occupants.

If you’re interested in learning more about Egypt’s electricity or simply want to do more research, I suggest looking up these sites:
Egypt Gas’ Natural Gas Projects
US Energy Information Agency (EIA) Country Information on Egypt
Egypt Energy Report, country analysis from 2006

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