Saudi Electricity says subsidies should be revised

RIYADH Tue May 7, 2013 4:50am EDT

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RIYADH May 7 (Reuters) - Saudi Arabia's system of electricity subsidies "should be revised", the chief executive of Saudi Electricity Co, the country's majority state-owned power utility, said on Tuesday.

"Subsidies are becoming a big part of the government budget," Ali al-Barrak said at a financial conference in Riyadh. "Subsidies should be revised and done in a different way. They should be smarter and support the low-income people."

He also described subsidy reform as one tool to reduce energy consumption. Fuel and water subsidies are also issues for the government, he added.

Earlier, Economy and Planning Minister Mohammed al-Jasser said at the conference that Saudi Arabian government subsidies, particularly for fuel, were "increasingly distorting" the economy and that the government was trying to address the issue.

He did not give any details or say whether his comments indicated a new initiative by the government.

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