Turkish company shuts off power supply to Lebanon

Karpowership provides up to a quarter of country's power supply from two barges

The 'Orhan Bey', an electricity-generating ship from Turkey, docked at the Lebanese port of Jiyeh, south of Beirut, in 2017. Reuters

Turkey's Karpowership, which provides electricity to Lebanon from two barges, said it was shutting down supplies on Friday over payment arrears and after a legal threat to its vessels in the country, which is in the middle of a deep economic crisis.

The company, which supplies Lebanon with 370 megawatts, the equivalent of about a quarter of the country's current supply, told the government this week that it would have to take the step if there were no moves to reach a settlement.

A source familiar with the situation said the measure was taken about 8am on Friday as fuel on the vessels ran out.

The shutdown threatens longer daily power cuts across Lebanon. The heavily indebted nation did not have enough capacity to meet demand even before Karpowership's move on Friday.

The 'Orhan Bey' is docked as a second floating power station waits off the coast at Jiyeh, south of Beirut, in 2018. Bilal Hussein / AP

Many people rely on private generators or struggle for several hours a day without power.

The source said the payment arrears exceeded $100 million, and that the Lebanese government had not reached out for talks or to try and resolve a legal case, despite the company's repeated appeals meant to avert a shutdown.

Lebanon's Finance Ministry said it had been notified by the Turkish firm and cited a lawmaker saying that the country could face "total darkness" in case of a shut-off. It has made no public statement about any talks.

A Lebanese prosecutor threatened this month to seize the barges and fine the firm after Lebanese TV channel Al Jadeed reported corruption accusations over the power contract.

The firm, a unit of the Turkish energy company Karadeniz, denies the charges.

At the weekend, it said it had not been paid for 18 months, a period coinciding with Lebanon's financial crisis, and added that it sought a "reasonable solution" to maintain generation.

Each of its barges has capacity of 202 MW, against a contract to supply a total of 370 MW.

An industry source said Lebanon's total capacity was about 2,200 MW, including the barges, but was only generating a total of 1,300 MW, including the Turkish supplies of 370 MW. Lebanon’s peak demand in 2020 was 3,500 MW, the source said.