Lebanon’s energy minister proposes electricity workaround amid state paralysis

The country's electricity sector is caught between an economic crisis and a power vacuum

A switched-off lamppost near the headquarters of Lebanon Electricity company. Getty images
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Lebanon’s caretaker Minister of Energy and Water Dr Walid Fayad proposed on Monday a “legal, constitutional and agreeable” workaround solution to stabilise the country's electricity sector.

“Today's initiative proposes a comprehensive and lawful solution to the electricity crisis,” Dr Fayad said at the press conference held at the Ministry of Water and Energy. “There is a vacuum and if it continues like this it will threaten and prevent national co-operation for the common good from taking place.”

Lebanon's state-provided electricity is in a shambles amid financing troubles and a governance paralysis that has prevented previous electricity plans from taking effect.

The proposal involves receiving a treasury advance of around $300 million over five months to cover the cost of four ships loaded with gas oil and fuel oil, in addition to the cost of maintenance of the sector. The plan would provide around four hours of electricity per day. The revenue generated during tariff collection would help the energy ministry return the advance to the Central Bank — creating a rolling line of credit, Dr Fayad explained.

“What we propose doesn’t need the council of ministers to convene,” said Dr Fayad. “Over the weekend I received some signatures on the decrees I drafted, and I hope the Prime Minister and other ministers will follow suit.”

Monday's plan will produce half the electricity that Dr Fayad’s previous electricity plan would have. The unsuccessful November plan involved Central Bank financing to cover the price of costly fuel imports to power energy plants, but it met a dead end following the end of Michel Aoun’s six-year presidential term.

With no president, the struggling Mediterranean nation was left headed by a caretaker government with limited power. The root of the state paralysis following Mr Aoun’s absence stems from rival political parties’ disagreement on whether a caretaker government can convene in the absence of a president. Meanwhile, the presidential vacuum appears set to continue.

In November Dr Fayad proposed an electricity plan that would see Lebanon's central bank finance around $600 million in order to generate six months of state power for around eight hours a day. But such a move required a full cabinet to meet physically and reach agreement.

The Free Patriotic Movement, which Dr Fayad has ties to, has been criticised for blocking attempts by the caretaker Prime Minister to convene the government. The FPM maintains that a resigned government cannot convene constitutionally.

Lebanon’s residents have been dependent on expensive shared generator networks since the end of the country’s 1975-1990 civil war, when the nation’s power infrastructure was devastated. But state provision of electricity has become a phantom event since Lebanon’s economic crisis began in 2019. Where once they switched on for a few hours a day to fill gaps in state electricity provision, generators have become a primary source of power in most households.

Caretaker Prime Minister Najib Mikati has called for a caretaker cabinet meeting this Wednesday, although the the Free Patriotic Movement and its allies are expected to boycott it — Dr Fayad included.

The energy minister said he was open should Mr Mikati present further options at the incomplete cabinet meeting, “as long as it’s constitutional”.

Updated: January 17, 2023, 1:51 PM
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