Minister of Energy Responds to Record Electricity Consumption in Iran: Prices Must Be Rationalized

While the Ministry of Energy has recently reported new records in electricity consumption in Iran, Hamid Chitchian, the Minister of Energy, stated that the price of electricity in the country is very low, which is one of the main reasons for its high consumption. In recent days, reports have emerged indicating that electricity consumption in Iran has reached its highest level in history, with an increase of 11,000 megawatts compared to the same period last year, reaching over 52,000 megawatts last Wednesday. On August 2, Mr. Chitchian said in a program on state television that 'in all countries of the world except for three countries—America, Finland, and Switzerland—people have less purchasing power for electricity compared to Iran, and in these three countries, the high income allows for sufficient purchasing power.' It seems that the Minister's comments also hint at a possible increase in electricity prices in Iran; he mentioned that there is a belief in the country that an increase in electricity prices might harm some citizens, 'while the price of electricity is not supposed to increase uniformly... certainly, people will not suffer losses.' The household electricity tariff in Iran increased by 10% in each consumption tier in Esfand 1394 (March 2016). In Esfand 1393 (March 2015), the price of electricity had increased by 24%. Each tier depends on the kilowatt usage and the amount of electricity consumed in each household. The price of electricity in Iran also depends on the time of use. The prices for the agricultural and industrial sectors have also increased separately. Previously, the Ministry of Energy had warned about electricity supply in the years 1395 and 1396 (2016 and 2017). In Aban 1394 (November 2015), Houshang Falahatian, the Deputy Minister of Energy, stated that the access of the electricity industry to the necessary financial resources had decreased. At that time, Mr. Falahatian had predicted a need for 53,000 megawatts of electricity in the year 1395. On August 2, Hamid Chitchian stated, 'Considering that the price of electricity in Iran is very low, it causes people to be careless about how they consume electricity.' He cited examples such as poor wall insulation and people's disregard for energy labels on appliances like refrigerators or televisions, emphasizing that 'education and regulations' are also needed in this area. The Minister of Energy also warned that 'not rationalizing electricity prices' would lead to other problems such as reduced investment and a lack of private sector engagement. The increase in electricity prices in Iran has its critics, including in areas where electricity bills are very high due to a lack of gas. On the other hand, media close to conservatives have also mentioned clerics like Ahmad Jannati, Secretary of the Guardian Council, and Mohammad Ali Alavi Gorgani, a Shia authority in Qom, among the 'critics' of the increase in electricity prices in Iran.