Saudi Arabia will revise electricity, water and wastewater tariffs from January 1, 2027, to improve consumption efficiency and sustain essential services, while introducing monthly financial support for eligible citizens to ease the impact on living costs. Custodian of the Two Holy Mosques King Salman bin Abdulaziz ordered the support measures following a proposal by Prince Mohammed bin Salman, Crown Prince and Prime Minister. The package includes SAR 500 ($133) in monthly assistance for eligible groups and a phased increase in the minimum wage required for Saudi employees to count fully toward Saudization quotas under the Nitaqat program. Saudi Energy and the National Water Company announced the tariff revisions, covering residential, non-residential and government customers, in accordance with procedures governing adjustments to energy and water prices. The companies said customers could review the revised rates on their official websites. Improving consumption efficiency The two new tariffs are designed to boost consumption efficiency for electricity and water while ensuring service sustainability. Government support for the water sector will continue to cover capital expenditures, which account for more than half the cost of each cubic meter delivered to consumers. According to the latest statistics, 99% of residential water customers have connections with diameters ranging from zero to 40. For customers consuming no more than 30 cubic meters, the increase in their bill will not exceed SAR 67, including value-added tax. The electricity tariff changes are expected to have a limited impact on most industrial, commercial and agricultural activities. Water tariff adjustments will not apply to industrial or agricultural uses. In agriculture, for example, a monthly electricity bill of SAR 5,000 ($1,333) could increase by SAR 300 to SAR 400. The impact could be reduced through more efficient electricity and irrigation water use and better scheduling of pump operations. 3 tracks King Salman's directives encompass three tracks for citizens: an additional monthly stipend of SAR 500 for social security beneficiaries; a monthly increase of SAR500 for civil service and operational scale employees, to be added to their specified allowances; and a gradual adjustment of the minimum wage required to count a Saudi worker toward localization percentages under the "Nitaqat" program. These measures aim to bolster the assistance provided to social security beneficiaries, increase the income of civil service and operational scale employees, and modify the mechanism for calculating Saudi workers within localization ratios under the "Nitaqat" program over two phases, thereby granting establishments sufficient time to prepare for implementation. A fixed monthly support of SAR 500 has been allocated and added to the salaries of state employees, stemming from the government's steadfast commitment to ensuring they are shielded from any livelihood ramifications resulting from economic decisions to amend electricity and water tariffs. This measure enhances the support provided to them and accounts for their living requirements, reflecting the state's continued backing of citizens and its mitigation of the impact of economic changes on them. Supporting citizens and addressing their needs remains a constant priority, as the state continues to develop support programs and initiatives to ensure they reach eligible groups while considering the impact of economic changes and decisions on their livelihood. Monthly support for citizens For government employees, the increase will be added to a designated allowance rather than basic salaries, without affecting other allowances or financial benefits. The measures are intended to ease the impact of higher utility costs on households and strengthen social protection. Although the tariff revisions are expected to exert some upward pressure on inflation, the accompanying support measures are expected to help contain the impact and maintain stability in living costs. Payments to social security beneficiaries will be based on existing records and coordination with relevant authorities to verify eligibility and prevent duplicate disbursements. The mechanism is designed to minimize administrative requirements while ensuring assistance reaches eligible recipients. Private sector The package also includes a two-stage increase in the minimum wage required for a Saudi employee to count as one full worker toward a company’s Saudization quota under the Nitaqat program. The threshold will rise to SAR 5,000 on April 25, 2027, six months after the decision, before increasing to SAR 6,000 on April 25, 2028. The adjustment does not involve direct cash payments from the ministry to Saudi private sector employees. Instead, it changes the wage threshold used to calculate their contribution to companies’ Saudization requirements. The phased implementation is intended to give private sector establishments sufficient time to prepare. The tariff revisions and accompanying financial measures seek to balance more efficient resource consumption with continued support for citizens, while ensuring the sustainability of electricity and water services.
