Household Use of and Spending on Energy

Electricity and LPG are the most commonly used fuels in households, as evinced from the nationally representative Household Income Expenditure and Consumption Survey (HIECS) in 2012. The HIECS contacts 24,000 households covering all governorates to collect information on the annual consumption of 300 different goods and services, including household direct fuel and electricity consumption. Electricity access is universal, but the level of use increases significantly with income. Monthly average consumption of energy in the richest quintile is at least double that of the consumption of households in the poorest quintile.^[1] The average monthly electricity consumption across the entire population is 234 kWh. Use of gasoline progressively rises with income quintile, forming one-fourth of their total fuel consumption. For the poorest, electricity and LPG comprise the energy basket, and the use of any other fuel is negligible (Fig. 6.9).

LPG is almost universally used for cooking in rural areas and by two-thirds of the households in urban areas. The LPG distribution system is chaotic and informal, which directly affects the quality of service delivery for households. The retail price is artificially depressed at LE 8 per cylinder, but it can go up to LE 50-60 per cylinder during months of shortages. Natural gas, as the alternative to LPG for cooking, is prevalent in the higher-income quintiles and in urban areas. Gasoline and fuel oil, mainly used as transport fuels, are mostly consumed by the higher-income quintiles. Natural gas for cooking and transport fuels has been gaining users. The share of households using natural gas for cooking increased from 10% in 2005 to 19% in 2013, and the share of households using wood/coal and liquid fuel fell during this period. The share of households using transport fuels grew from 11 to 23% during the same period.

On average, households spend about 3% of their budget on energy. Although energy spending increases with income, the share of the budget spent on energy is similar in rural and urban areas and across income quintiles. Electricity represents the largest share, accounting on average for more than 50% of the energy budget. Households in the richest quintile spend a larger proportion of their income on

Fig. 6.9 Household annual average energy expenditure. a Total household energy budget. b Disaggregation of household energy budget. Source HIECS 2012. Note HIECS = Household income expenditure and consumption survey

transportation fuels compared to households in poorer quintiles. In contrast, households in poorer quintiles spend more of their income on LPG than households in richer quintiles (Fig. 6.10).

• [1] Households are ranked according to their per capita consumption and grouped into five equalgroups from the poorest to the richest. Average per capita consumption for each of the fivequintiles are LE 2795; LE 3845; LE 4878; LE 6216; and LE 11,708, respectively.