RIYADH, Saudi Arabia – As part of a major reform of Saudi Arabia’s utilities, a national program to optimize water and energy consumption is expected to be launched.
Policy incentives currently in place for energy and water will be reviewed in the program, according to Reuters, which will take into account economic productivity needs.
Major changes have been expected in Saudi, a country trying to reduce heavy subsidies on water provision from a historic dependence on oil.
In April Water & Electricity Minister Abdullah al-Husayen was sacked after an increase in water tariffs had reportedly not been implemented as planned (read WWi story).
Then in May King Salman restructured the ministries responsible for handling water and energy policies, according to Reuters.
The old Water and Electricity Ministry was broken up, through royal decrees, with the water portfolio incorporated into a new Environment, Water and Agriculture Ministry.
In total, the country aims to reduce water and electricity subsidies by 200 billion riyals ($53 billion) and reduce non-oil subsidies by 20% by 2020.
While details over the national program have not emerged to date, it’s clear that raising subsidies and reforming will be a controversial and long process.
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