Egypt: Power Outages Revitalize the “Dark Economy” and Double the Demand for Alternatives

Egypt suffers from increased demand for generators and other alternatives due to frequent power outages and rising prices.
Picture of Sohad Elkhodary

Sohad Elkhodary

Egyptians have increasingly turned to purchasing rechargeable flashlights, fans, and imported electric generators during 2023 and 2024, coinciding with the Egyptian government’s implementation of a load-shedding plan since last July, with rates ranging between 50% to 100%, according to traders and citizens we spoke with.

Following this increase, prices rose between 70% to 115%, boosting the “dark economy” bill as Egyptians flocked to buy generators, rechargeable fans, and flashlights due to daily power cuts lasting between three to five hours at their homes and workplaces.

Among these buyers is 30-year-old Mohamed Mansour from Cairo, who was driven to buy a generator for his home last June to protect his children’s lives amid Egypt’s high temperatures.

Mansour told Zawia3: “I focused on several factors when purchasing the generator; the most important were safety to protect my children’s lives and ensuring I had enough power to run the air conditioning, lighting, and electronic devices.”

He added: “The purchase cost was 31,000 EGP (646.35 USD), but operating it is an additional burden, as it consumes 2.8 liters per hour, with a total daily running cost ranging from 150 to 160 EGP, equivalent to 4,500 to 4,800 EGP monthly, an extra cost added to my expenses due to power cuts.”

Mansour, like other Egyptians, dreams of the government halting the load-shedding plan, especially as his freelance work requires daily electricity to support his family.

Decline in Generator and Transformer Imports

According to the 2023 Foreign Trade Bulletin issued by the Central Agency for Public Mobilization and Statistics, Egypt’s imports of generators, transformers, and power generation sets decreased from 742 million USD in 2020 to 558 million USD in 2021, a decline of 24.8%. The number of motors and generators imported by Egypt in 2020 was 13,562,352 units valued at 139,022 USD, while in 2021, 8,904 units were imported, valued at 29,422 USD.

Mina Nabil, who has owned a generator import business for about 15 years, described how demand for these generators increased as Egypt implemented the load-shedding plan. He said companies and projects are more likely to buy generators, while home purchases account for no more than 15% of sales.

According to Nabil, Chinese generators are the most popular in Egyptian markets. He noted that prices for generators used by companies range between 300,000 to 750,000 EGP, denying current rumors of an import crisis, especially after the dollar rate stabilized in recent months.

Saeed Mostafa, a generator seller in Dakahlia governorate in the Nile Delta, agreed, revealing that Egyptians’ demand for generators increased by more than 50% from July 2023 to early July 2024, compared to the same period in 2022.

He told Zawia3: “There was weak demand for generators in previous years, but recently, the demand has surged unprecedentedly,” listing the main buyers, including shops, pharmacies, and medical clinics, representing about 70% of the demand. Prices range from 9,000 to 40,000 EGP, depending on the generator’s capacity, type, and the buyer’s purchasing power.

Mostafa disclosed that generator prices have risen significantly due to increased demand. Prices increased from 5,000 to 9,000 EGP between 2022 and 2024, while the price of an 8-kilowatt generator increased from 27,000 to 40,000 EGP in the same period, with increases ranging from 48.1% to 80%.

Zawia3 contacted the Chamber of Commerce to inquire about the volume of generator imports and the countries from which they are imported. Mohamed Hassan, head of the Chamber’s division in Cairo, confirmed that there is no division specialized in generators, so no information is available.

Egypt does not only import generators but also exports them. According to data from the Export Development Authority, the top four countries importing small generators (up to 75 kVA) from Egypt are Turkey, Sudan, Tunisia, and Libya. Egypt’s total exports of these generators from 2012 to 2022 amounted to 226,900 USD. In 2013, generator exports totaled 169,000 USD, a growth rate of 8,451.1%, but this declined in 2022, recording a -100% growth rate.

Record Increases

George Zakaria Sedra, head of the electrical appliances division at the Giza Chamber of Commerce, revealed in an interview with us that Egyptian purchases of flashlights and fans have increased since the load-shedding plan began. Flashlight purchases increased by 50% to 60% from 2020 to the present, while fan purchases doubled from July 2023 to June 2024 compared to 2020.

Due to the increased purchase rates, fan prices rose by 70% from July 2023 to June 2024 compared to 2020, while flashlight prices increased by 125%, with costs rising from 400 to 900 EGP per flashlight between 2020 and June 2024.

According to Sedra, the implementation of Egypt’s load-shedding plan prompted an Egyptian company to develop its products and launch an 18-inch rechargeable fan with a six-hour continuous operation, priced at 3,000 EGP, up from 2,500 EGP last April, driven by unprecedented demand that led the factory to release a new batch at higher prices.

The head of the electrical appliances division urged the government to find alternative solutions to power cuts. He proposed solutions he considers lifesaving, such as reducing streetlight intensity by 50% to 60%, closing clubs at 11 PM and shops at 10 PM, or raising electricity bill rates while stopping the load-shedding plan, which burdens citizens with additional costs, such as damaging home appliances and elevator motors and burning out computers and company servers, resulting in millions of pounds in losses and additional burdens on citizens due to equipment damage.

Decline in Egypt’s Generator Exports

According to data from the Export Development Authority, the top five countries importing generators (75 to 375 kVA) from Egypt are Australia, Saudi Arabia, Iran, Norway, and Libya. Total exports from 2012 to 2022 amounted to 1.1 million USD. In 2017, exports surged to 938,700 USD, a growth rate of 528.4%, but dropped to 0% in 2022.

The main countries importing diesel or semi-diesel generators (375 to 750 kVA) from Egypt are the United Kingdom, South Korea, Kuwait, and Saudi Arabia, with total exports from 2012 to 2022 amounting to 2.4 million USD.

Solar Energy

Hatim Abdel Monem, Professor of Environmental Sociology at the Faculty of Environmental Studies at Ain Shams University, advocates for Egypt to use solar energy as an economical solution to the power outage crisis.

He added, “The most expensive part of transitioning the state system to solar energy is the initial conversion, which is the biggest burden on any country that adopts it.” He noted that the world is turning to renewable energies like solar power, which is safer than electricity, emphasizing that there are losses from power cuts, including the cost of importing generators and losing tourism investments that could have been used to generate renewable energy sources.

Egyptians await the government to fulfill its promises, as Prime Minister Mostafa Madbouly previously set the third week of July as the final deadline for load-shedding. He stated that the government would bear the cost from the general budget.

Sohad Elkhodary
An Egyptian journalist who has worked for several Egyptian newspapers and Arab websites, focusing on investigations and human-interest stories.

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