Lebanon needs massive investments to close its power gap

Lebanon will invest USD1.2bn over four years to add 700 MW of power generation capacity. But that is not going to be enough to end the crippling power deficit.

Demand for electric power in Lebanon is expected to double to about 5,000 mega watts by 2015 with supply continuing to be under pressure.

Electricity production capacity in the Levant nation was estimated at 1,450 MW at the end of 2011, compared to demand of 2,630 MW, leaving a deficit of about 40%. The government seeks to add 700 MW during the coming four years, at a cost of USD 1.2 billion, resulting in a deficit of USD 2 billion in the ministry of energy’s budget in 2012, compared to a deficit of USD 1.4 billion in 2011.

Electricité du Liban, the state-owned Lebanese utility, produces 1,450 MW, according to its chairman, Kamal F. Hayek, who says there are no problems at the transport and production levels. Hayek attributes a lot of the current gap between supply and demand to the stoppage of between 250 MW and 300 MW that used to come from Syria and Egypt, in the wake of the recent geopolitical unrest. “The only solution is to increase domestic production,” Hayek said.

Syria used to provide between 120 MW and 140 MW during the day and 250 MW to 300 MW during the night. Egypt has reduced its feed from 130 MW to 30 MW. Thermal power plants account for 1,355 MW of domestic production while 108 MW comes from hydro plants.

Government data indicate that USD 19.5 billion was spent on Lebanon’s electricity sector over the past 15 years, an amount that is about a third of Lebanon’s public debt.