* Heat wave, Ramadan spark power consumption surge
* Cement, steel producers could be impeded, economist says
* Ministry says outages are temporary, promises action
By Sherine El Madany
CAIRO, Aug 19 (Reuters) - Egypt’s electricity ministry vowed on Thursday to tackle power outages that economists say could cramp investment and that have prompted public grumbling during a hot summer and the Muslim fasting month.
Power consumption has surged as summer temperatures have climbed to about 40 degrees Celsius and as most of the country gathers at sunset to break the day’s fast during Ramadan, often enjoying the company of friends and family late into the night.
EFG-Hermes economist Mohamed Abu Basha said Egypt, despite expanding generation capacity in recent years, needed to spend more “or it could negatively impact investment”, particularly in industries such as cement and steel.
“Cement and steel (plants) are energy-intensive industries,” he said. “To sustain high levels of economic growth, Egypt needs to increase investment in power generation.”
He added that the issue was becoming a more common problem in Egypt and across the region in summer, when demand rises.
Construction has continued to boom in the country in part due to rising demand for housing, even during the global slowdown.
Egypt has said it aims to attract investments worth $110 billion in its energy sector by 2027. It wants 20 percent of its power to come from renewables by 2020, such as wind and solar. Power plants are now mostly gas-fired.
Ministry Spokesman Aktham Aboul Ela told Reuters power usage had increased 11.5 percent year-on-year and that peak demand hit 23,500 MW this year.
That puts it roughly equal to Egypt’s installed capacity of 25,000 MW, the figure cited by Electricity Minister Hassan Younes last year. The minister said Egypt aimed to add 58,000 MW more by 2027, roughly tripling existing capacity.
“Our strategy is to raise awareness to curb consumption as well as to add new capacity,” Aboul Ela said by telephone.
Outages have hit several provinces including Cairo, with cuts mostly during the evening, newspapers reported.
The daily al-Masry al-Youm said protesters gathered in al-Fayoum south of Cairo about power shortages. Suburbs of Cairo have also suffered water cuts due to the power outages that stopped pumping stations, the official news agency said.
The minister said in a statement on Thursday that outages were temporary due to the heat wave. He said steps to help boost output included successfully conducting tests to put additives in Egyptian fuel oil to match the needs of power plants.
The minister blamed the surge in demand on “temperature rises that were unprecedented”. (Editing by Edmund Blair and Jane Baird)