A municipal proposal to reduce electricity and water tariffs for charitable organisations has been turned down by the Electricity and Water Authority (EWA), warning that such a move would undermine its financial sustainability and ability to meet contractual obligations with private sector providers.
In an official response to the Southern Municipal Council, the EWA clarified that it already offers specific support to registered charities, places of worship, public parks and sports clubs – but within a framework that must balance rising costs and fiscal responsibilities.
“The EWA does not profit from the supply of electricity and water. What we charge is merely a recovery of the cost of procurement and delivery,” said EWA chief executive Kamal Ahmed.
“We are obliged to pay private producers and contractors within 42 days, and we rely entirely on collections from customers to fulfil these obligations. Any disruption to that balance could compromise our operations.”
Mr Ahmed explained that under Cabinet Decision No (04-2350) and Resolution No (2) of 2016, the government shoulders the Value Added Tax (VAT) on electricity and water services for certain establishments, including charities and public interest institutions. However, the decision does not mandate a reduction in base tariffs or any further subsidies beyond VAT coverage.
Mr Ahmed
“Expecting the authority to lower tariffs further for any category – regardless of how noble their purpose may be – would directly impact our ability to maintain services, invest in infrastructure and support long-term efficiency goals as part of the national fiscal balance programme,” Mr Ahmed added.
While the EWA acknowledged the importance of charitable work, it maintained that financial constraints prevent it from implementing any reductions beyond what is already provided through government VAT exemptions.
A charity drive
The debate has highlighted a broader question of how best to support charitable organisations in Bahrain without undermining the operational integrity of public utility services.
For now, the EWA appears firm in its stance, balancing its financial duties with growing social expectations.
The EWA’s statement came in response to a proposal submitted by Southern Municipal Council member Mohammed Daraj, who called for reduced utility costs for registered charitable societies.
Mr Daraj argued that such organisations provide essential support to low-income families and contribute to social cohesion.
Mr Daraj
“These associations aren’t businesses. They are non-profit entities founded on Islamic principles of charity and public service,” said Mr Daraj. “Electricity and water bills, when charged at standard rates, become a heavy burden that threatens their sustainability.”
He emphasised that many of these societies operate on tight budgets, relying on donations to serve a growing number of families in need.
“Reducing tariffs would not be a loss to the state – it would be an investment in social stability. It would allow these groups to expand their reach and help more people,” he said.
mohammed@gdnmedia.bh
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