Iran to provide full subsidy on electricity for 8.4 mln households: Minister

Iran is to offer full subsidy on electricity used by millions of households, according to the country’s energy minister, as the government seeks to encourage lower consumption of power among customers.

Reza Ardakanian said on Wednesday that the plan to offer free electricity would cover almost 8.4 million households whose power consumption is below the average use of the country.

The announcement came two days after Iranian President Hassan Rouhani said his Cabinet had agreed on a plan to fully subsidize power for almost 30 million people in Iran, a country of nearly 84 million.

Rouhani hailed the measure as unprecedented in Iran since the Islamic Revolution of 1979, saying it would be for a first time in the country that low-income people can benefit from free energy.

However, the plan would not only cover the low-income and poor people in Iran as many households are normally frugal in their consumption of electricity despite the fact that prices are far below the international standards.

That is mainly because of increased public awareness about the huge costs of power production as well as its impacts on the environment.

Ardakanian said that in addition to 8.4 million low-consumption households, there are almost 16.5 customers whose current use of power is acceptable and normal.

The Energy Ministry expects more households to reduce their use of power to become eligible for full subsidy offered by the government, he said.

Iran reported a peak electricity consumption of 60 gigawatts hours (GWh) over recent summer months which is nearly on par with the country’s total power output although nominal generation capacity is higher at around 86 GW.