Turkish barges stop supplying Lebanon with power as contract ends

Karpowership will remove its two power-generating barges

A Turkish company that used to cover almost a quarter of Lebanon’s power needs ceased operations on Friday after its contract with the government ended.

Karpowership had been providing Lebanon with electricity since 2013 through two power barges, Fatmagul Sultan and Orhan Bey, feeding the Jiyyeh and Zouk power plants.

The company had suspended its operations in May over late payments but resumed supplying Lebanon with electricity as a goodwill gesture a month later.

“We are fully aware of the current energy crisis," Karpowership said in a statement.

"During our eight years of activity in Lebanon, despite all the challenges, we have done everything possible to support the Lebanese people and the government, in order to meet the fundamental challenges facing the country. We wish the Prime Minister, his government and the country the best for the months and years to come," the statement said.

Lebanon's national power company, Electricity du Liban, used the barges to bolster its supply, having struggled for years to meet peak demand of more than 3,000 megawatts with its ailing infrastructure.

EDL, which has a maximum production capacity of about 2,000 megawatts, has been operating at a loss for more than two decades, selling electricity at subsidised tariffs below production cost.

The company's power supply significantly dropped in recent months as the Central Bank rationed its subsidies of fuel imports to protect its dwindling foreign currency reserves.

Power blackouts have since intensified with EDL providing only about four hours of electricity a day in many parts of the country.

Private generators that used to compensate for EDL’s rationing are also unable to meet demand because of diesel shortages.

The government asked the Central Bank on Wednesday to provide EDL with a $100 million loan to boost its power supply.

Energy Minister Walid Fayyad said the government aims to boost EDL’s power supply before deciding on how much to raise tariffs as part of a comprehensive plan to reform Lebanon’s electricity sector.

Western powers have said financial support is conditional on the introduction of reforms to combat corruption and fix the country’s finances, including changes to the power sector, which cost the treasury $1.5 billion in 2019.

Since Lebanon’s financial crisis unfolded in late 2019, the local currency has lost more than 90 per cent of its value against the dollar. The World Bank described Lebanon’s financial meltdown as one of the most severe since the 1850s.

On Thursday, Jordanian Prime Minister Bisher Al Khasawneh said his government was ready to help Lebanon resolve its power crisis and meet its energy needs.

Mr Al Khasawneh was the first senior foreign government official to visit Beirut since a new Cabinet assumed duties after a year of political paralysis that accelerated the country's financial meltdown.

Lebanese prime minister Najib Mikati said the two discussed efforts to import Egyptian gas and supply Lebanon with electricity from Jordan through Syria.

Updated: October 1st 2021, 10:22 AM
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