Lebanon Cabinet Approves Electricity Reform Plan

Lebanon’s cabinet on Wednesday approved a plan to reform and restructure the country’s crippled electricity sector, a main condition of Western donors and the World Bank to provide financing for regional deals to increase the country’s power supply.

Al Jadeed TV reported that the cabinet had endorsed the plan with amendments from a previous version, including the creation of an electricity regulatory authority in 2022 rather than in 2023, another step demanded by donors.

Energy Minister Walid Fayad could not be reached for comment.

 

Lebanon’s crippled power sector has not provided round-the-clock power since the country’s 1975-90 Civil War and cash transfers to state-run utility Electricte du Liban (EDL) to cover chronic losses have contributed tens of billions of dollars to the country’s huge public debt.

The World Bank has backed deals for Lebanon to import Egyptian gas and Jordanian electricity that Fayad has said could increase power supply to up to 10 hours per day, conditional upon approval of the plan and several other measures.

The International Monetary Fund, with which Lebanon is discussing a potential bailout program, said last month preventing the sector’s drain on public resources was a key pillar of the country’s recovery from a deep financial crisis.

But two previous plans with similar goals have gone unimplemented due to political disagreements.

A previous version of the plan, dated February 2022 and seen by Reuters, had called for electricity tariffs to be increased and foresaw a $3.5 billion investment in the sector to secure 24-hour power by 2026.