Lebanon: Energy Resources

Extend network

Access to electricity across Lebanon stands at nearly 100%. The infrastructure is being expanded to meet increasing demand by building a 220 kV super grid, reinforcing the distribution network, providing new generating capacity, implementing administrative reforms and improving technical assistance. The EDL system is now interconnected with the Syrian system through two 220/400 kV overhead lines with an overall capacity of 400MW. EDL’s transmission network consists of many types of high voltage power linesl as 58 major power substations converting power from high voltage to medium voltage. In addition, the network includes more than 1 615 km (1336 km of overhead lines and 279km of underground cables) of various voltages used for transmission and distribution. The distribution network consists of substations converting power from medium to low voltage to deliver electrical power to every subscriber.

Energy procedure

A government statement in March 2010 called upon the LCEC to provide a “national road map”, built on environmental concepts, to aid in the government's goal of achieving 12% renewable energy contribution to primary energy supply by 2020. The National Energy Efficiency Action Plan for Lebanon (NEEAP) 2011-2015 for the Electricity Sector was developed in 2010.

Energy debates

On July 1, 2010, the Lebanese Center for Energy Conservation (LCEC) published a National Policy for Energy Efficiency and Renewable Energy. Plans include a project to provide 3 million CFL lights to Lebanese homes, as well as US$1.5 million in subsidies for solar water heaters. The current draft of the Energy Conservation Law includes plans for: - A mandatory energy audit for large facilities, - Close collaboration with ESCOs, - Promotion of energy efficient equipment - Application of energy conservation measures to all public and governmental facilities.

Energy sources

Total Installed Electricity Capacity (2009): 2312 MW The total electricity provided is from: Thermal power plants: 88% Hydro: 4.5% Imports from Syria and Egypt: 7.5% In 2009, Lebanon produced 13,771 GWh of electricity from Oil (12,956 GWh), Gas (193 GWh), Hydro (622 GWh), and imported 1,155 GWh of electricity. Total Primary Energy Supply (2009): 6,633 ktoe Oil: 94.7% Coal/peat: 2.0% Biofuels and Waste: 1.9% Hydro: 0.8% Natural Gas: 0.6%

Regulatory roles

The Ministry of Energy and Water drafts decrees/laws that are then forwarded to concerned Ministries for review and comment, and then to the Council of Ministers for approval.

Competition

To encourage greater private sector participation in the economy, the Government with support from the World Bank initiated the Power Sector Restructuring and Transmission Expansion Project to implement electricity sector wide re-structuring and reform designed to introduce competition and private sector participation in utility operations and to reorganize EDL. To that end, a draft law to privatize generation and distribution but keep transmission under EDL control was prepared by the government in 2010. Although there do exist a small number of distribution concessions, but most electricity generation, transmission, and distribution in Lebanon is undertaken by a vertically-integrated public utility, EDL.

Energy efficiency

In 2009, the total final consumption was 4,437 ktoe, to which the transport sector contributed the most at 1,754 ktoe, followed by the residential sector at 1,604 ktoe, the industry at 592 ktoe and commercial and public services at 189 ktoe. By source, oil products contributed the most at 3,054 ktoe, followed by electricity at 1,130 ktoe, coal and peat at 132 ktoe and biofuels and waste at 121 ktoe. Lebanon’s major energy consuming sectors often lack the most basic EE measures; hence there is no positive ‘energy efficiency effect’. There is hence a large potential for reducing Lebanon’s energy intensity.

Capacity concerns

Even though Lebanon has 100% electrification, the overall system lacks reliability, as there is demand-supply discrepancy and the regular power cuts. Available net thermal capacity varies from as low as 1600MW (and sometimes lowers) to a maximum of 2000MW. This is due to several shortcomings such as restoration requirements, plant failures, fuel supply problems, and external hostilities (i.e. damage to fuel storage capacity or electricity generators due to war time hostilities) among other occurrences. Hydro power availability also depends on rainfall and has been as low as 80MW. The overall demand for electricity in 2009 was estimated to be around 15,000 GWh; consumption amounted to 11,522 GWh, thus EDL was not able to satisfy the remaining 3478 GWh in demand. Lebanon has not added any installed capacity for the past 14 years while electricity demand growth is estimated be in the range of 2.5–8% per year. The shortage in installed capacity is estimated to be around 700 MW in 2010. To meet estimated demand increases, an additional 800 MW of installed capacity will be required by 2014; while another 1000 MW will be required after 2015 in order to reach a total installed capacity. In the transmission and distribution (T&D) networks, technical losses are on average 15% in Lebanon, while non-technical losses amount to a further 17.8% of electricity produced. Non-technical losses are high, but have improved from a decade earlier when they were estimated to be approximately 48%. These are attributed to either electricity consumed through illegal connections, meter manipulations, or are consumed yet unbilled due to the shortcomings in the billing system. EDL has been regaining control over its operations and steps are being taken to address billing and collection weaknesses as well as curbing non-technical losses.

Government agencies

The Lebanese Center for Energy Conservation (LCEC, http://lcecp.org.lb/) was created in 2002 through the support of the UNDP as a subsidiary of the Ministry of Energy and Water, and addresses end-use energy conservation and renewable energy at the national level. It supports the Government of Lebanon to develop and implement national strategies that promote the development of efficient and rational uses of energy and the use of renewable energy at the consumer level. LCEC is financially and administratively independent of the Ministry, and operates under the direct supervision of the Minister. The LCEC is involved in a range of pilot projects, including in the solar water heating market, conducts the Energy Audit Program, and provides financial and tax incentives to consumers to promote energy efficiency. The LCEC has in cooperation with the Lebanese Standards Institution (LIBNOR) developed EE standards for the following five household appliances: solar water heaters, compact fluorescent lamps, refrigerators, AC split units, electrical and gas water heaters.

Energy regulation role

The Council of Ministries approve draft decrees/law. Local decision-making takes place through Mohafazats (regional governments) that provide municipalities with decisions and laws to be implemented. Then, local authorities have the full right to enforce the application of these laws. In addition, they have the authority to set conditions for providing licenses necessary to implement regulations pertaining to energy.

Ownership

Electricity is supplied through Electricité du Liban (EDL, http://www.edl.gov.lb/) which is an autonomous state-owned entity under the jurisdiction of the Ministry of Energy and Water. It was founded by Decree No. 16878 dated July 10, 1964, and is responsible for the generation, transmission, and distribution of electrical energy in Lebanon. Currently, EDL controls over 90% of the Lebanese electricity sector (including the Kadisha concession in North Lebanon which is owned by EDL). Other participants in the sector include hydroelectric power plants owned by the Litani River Authority, concessions for hydroelectric power plants such as Nahr Ibrahim and Al Bared, and distribution concessions in Zahle, Jbeil, Aley, and Bhamdoun. The petroleum and gas sector is the responsibility of the Directorate of Petroleum (MoP). The MoP is responsible for licensing import activities, import and refining crude oil, import of fuel oil, and setting prices for petroleum products.

Degree of independence

N/A

Energy debates

Lebanon has not yet developed a comprehensive national energy policy and no thorough study of the recent changes occurring with respect to energy and its use in Lebanon has been published. CEDRO Project by UNDP has implemented several studies: - the National Wind Atlas of Lebanon (published in January 2011); - the assessment of the total bioenergy potential in Lebanon (expected to be completed by July 2011); and - the re-assessment of the concentrated solar power (CSP) potential (expected to be completed by September 2011) In 2009, the LCEC conducted detailed studies concerning potential energy savings, costs and payback periods for various measures in new buildings and allowed the development of thermal standards.

Energy framework

The Lebanese Association for Energy Saving and for the Environment (ALMEE, http://www.almee.org/) (a non-profit organisation), is dedicated to developing, increasing and promoting better management of energy, on a national level and in the Mediterranean basin as a whole. Their work encompasses the following fields: - Renewable energies: solar, wind, biomass, hydraulic, wood etc., - Generation and exploitation of electrical energy, - Buildings: insulation, glazing, heating, air conditioning etc., - Industrial processing, "co-generation" etc., - Air conditioning and heating, - Heat-pumps and refrigeration. - Transportation - Energy and the environment. EU (SYNERGY program) Euro-Mediterranean Energy Policy Training Network project, to establish a training network extending to all Mediterranean Partners and providing specialized services, enhancing implementation of the Action Plan of Euro-Mediterranean Energy Forum 1998-2002. The ultimate success of the Network was judged upon the effectiveness of the dissemination of European energy policy know-how to the Mediterranean Partners as well as upon the adoption by them of common international practices in energy projects financing. EU (INCO) project, DISTRES (www.distres.eu): Promotion and Consolidation of all RTD Activities for Renewable Distributed Generation Technologies in the Mediterranean Region. The overall goal of the three year DISTRES project is to exchange and disseminate good practice in renewable energy sources and distributed generation (RES-DG) through research and analyses of Mediterranean needs. Since solar potential is abundant in the Mediterranean, the area of interest of DISTRES will be primarily solar (photovoltaic and/or solar thermal concentrating systems) from DG systems. A UNDP project, Lebanon-Cross-Sectoral Energy Efficiency and Removal of Barriers to ESCO Operation, between 2002 and 2011 aimed at establishing the Lebanese Center for Energy Conservation and Planning; providing necessary engineering and energy marketing services pertaining to energy conservation; and assisting the government in strengthening its policy aspects and increasing public awareness pertaining to energy planning and conservation issues. The Country Energy Efficiency and Renewable Energy Demonstration Project for the Recovery of Lebanon (CEDRO, www.cedro-undp.org/) was created in October 2007 in partnership with the Ministry of Energy and Water, the Ministry of Finance and the Council for Development and Reconstruction of the UNDP. The project is part of a larger UNDP programme to assist in the country’s recovery from the 2006 conflict with Israel. CEDRO has a mandate of five years until October 2012 and a budget of $9.73 million funded by the Lebanon Recovery Fund by means of a donation from Spain. The aim of CEDRO is to complement the national power sector reform strategy and to support the greening of Lebanon's recovery reconstruction and reform activities. The project focuses on activating end-use energy efficiency and renewable energy applications in public sector buildings and facilities across Lebanon on several levels:

   The first level involves the implementation of end-use energy efficiency (EE) and renewable energy (RE) demonstration projects in approximately 80 public sector buildings and facilities across Lebanon;
   The second level involves the gearing of CEDRO projects towards assisting in alleviating barriers to increased penetration of RE and EE applications;
   The third level targets public awareness issues on climate change, energy consumption, and RE and EE applications;
   The fourth level increases the availability of validated data on energy consumption patterns, and RE and EE performance costs and benefits;
   The fifth level consists of supporting the formulation of a national sustainable energy strategy and action plan through a research and development program.

To date, the major already accomplished or ongoing initiatives include the introduction of compact fluorescent lamps (CFL), solar water heaters, EE measures in industry, street lighting programs, the development of standards and labels and the development of a number of energy related laws and financing mechanisms. The Policy Paper of the Electricity Sector was launched by the Ministry of Energy and Water in June 2010 as the national plan to upgrade the electricity sector in the country. The policy paper includes 10 strategic initiatives, three of them dedicated to energy efficiency and renewable energy. They include feed-in tariff and net-metering, the development of a National Energy Efficiency Action Plan (NEEAP), the establishment of the National Energy Efficiency and Renewable Energy Action (NEEREA) as a national financing mechanism and to develop the ESCO (Energy Service Company) business dealing with energy audit applications. The Policy Paper has also set the targets to increase the share of RE to 10% of the total energy supply by 2013 and to 12% by the year 2020, as well as to reduce energy consumption by 6% by the year 2013. The National Energy Efficiency Action Plan for Lebanon (NEEAP) 2011-2015 for the Electricity Sector was developed by the LCEC with the support by the EU-funded MED-ENEC project. The NEEAP was adopted by the Ministry of Electricity and Water in December 2010.

Reliance

Lebanon imports 99% of its primary energy requirements. In 2009, the net energy imports reached 6.67 Mtoe while energy production was 0.17 Mtoe. The economy supplied coal and peat, oil products and natural gas from imports without domestic production. The main electricity company in Lebanon, EDL, imports around $500 million worth of fuel each year to generate the electricity needed. This has resulted in $2.4 billion in debts.

Role of the government

The Ministry of Energy and Water (http://www.energyandwater.gov.lb/) is responsible for energy regulation in the country. The Ministry of Energy & Water is formed of 3 General Directions:

   The General Directorate of Hydraulic and Electric Resources
   The General Directorate of Exploitation,
   The General Directorate of the Petroleum

Regulatory framework

Regulation of the Power Sector (Law 462 dated 02/09/2002)

   Electricity Production: Monopoly EDL
   Private Production:
   < 1.5 MW: No restrictions
   1.5 – 10 MW: needs permission from Ministry of Energy & Water
   >10 MW: needs License from Ministry of Energy & Water
   No feed-in tariffs.
   Taxes on RE products: 5%

The Law has been adopted by the parliament and published by the President of the Republic. The primary aim of this law was the establishment of a regulatory commission in charge of elaborating the important details pertaining to the introduction of RE and energy conservation. The lack of political agreement has however prevented the establishment of the commission, and hence the implementation of law 462. The Law has subsequently been amended by law 775 dated 11/11/2006 that foresees independent power production for personal use. Law 775 is currently under review; it deals mainly with technical, environ- mental, safety and other regulatory aspects of private power production, but no provisions allowing private power producers to sell electricity are planned. The development and implementation of the new laws and initiatives relating to the energy sector show the Government of Lebanon’s commitment to its recently formulated targets for RE and EE.

Regulatory barriers

With the continued development of the national energy plan by the LCEC, it is hoped that a cohesive strategy for improving sustainability will be developed. However, with the strongly regulated electricity generation and distribution system existing in Lebanon, and due to the monopoly of the EDL, it is up to the government to promote and install wind farms and connect them to the grid. A regulatory change could open up the market for entrepreneurs fairly rapidly; especially as electricity generation in Lebanon is relatively expensive. The Lebanese government could introduce either ‘net metering, or policies such as feed-in tariffs (FITs). Without these legislative initiatives, the enabling environment for the RE and EE markets created by projects such as CEDRO cannot be sustainably carried forward, and Lebanon will likely be significantly delayed in reaching its target of 12% renewable energy of its total mix by 2020.

Energy regulator

The Ministry of Energy and Water is responsible for energy regulation in the country. Discussions are underway about the establishment of a separate electricity regulatory body (2010). http://www.executive-magazine.com/getarticle.php?article=13332 While the Regulation of the Power Sector (Law 462 dated 02/09/2002) aimed to establish a regulatory commission in charge of elaborating the important details pertaining to the introduction of RE and energy conservation, the lack of political agreement has prevented the establishment of the commission.

Renewable energy

Solar energy With the majority of towns and villages connected to the electricity grid, solar PV cannot compete with electricity supplied with the traditional oil-based methods. An exception exists for isolated remote applications such as transmission and relay towers. Due to abundant solar resources and the maturity of the solar thermal industry, Lebanon stands to benefit greatly from the utilization of solar water heating. Plans for the implementation of solar thermal collectors (STC) have been thoroughly studied. The CEDRO Project through UNDP has initiated a re-assessment of the Concentrated Solar Power (CSP), given the technological progress achieved in this field during the last decade, particularly since a report by ESCWA (UN) indicated that Lebanon has negligible potential in CSP due to the land, water, and low cloud cover requirements for CSP. The study is expected to be completed by the September 2011. Wind energy Two wind turbines have been installed prior to 2006; but one of them was destroyed during the 2006 summer war. There was significant evidence to support the presence of strong sustained winds in various areas in Lebanon, specifically the north. This evidence was mainly based on the tree deformation index, which suggested speeds of 7-8 m/sec to be present in selected sites. The first version of ‘The National Wind Atlas for Lebanon’ was published in 2011 by the CEDRO project with the support of the UNDP and the Spanish government. Both onshore and offshore wind maps have been generated, and results are very positive – particularly for onshore wind farm prospects. The constrained potential for onshore wind power in Lebanon has been estimated to be equivalent to 6.1 GW, yet when particular parameters are altered and sensitivity analysis applied, the potential becomes 1.5 GW. This does not include, however, the constraints set by the Lebanese electricity network. Recently, the Government of Lebanon has commissioned the assessment of micro-wind turbines for power generation in 10 different locations. Biomass energy Although Lebanon has little forest cover, it has significant other sources of biomass, namely municipal solid waste (MSW). 400 tons of MSW produced on a daily basis could provide 30% of the electricity needs. Biogas generation from sewer and farm waste decomposition has the potential of offsetting 2.8% of the electric needs. Biofuels As yet, there are no programs to produce or promote biofuels. Hydropower Lebanon is famous for its waters in an otherwise water deficient region. Several hydropower plants have been installed and others are expected soon. However, the share of hydropower to the overall electricity generation is around 5%. Geothermal energy 2 tentative sites have been identified. The first is in Sammaqiye, which was an active volcanic area a long time ago. The second site is off-shore of Tyre in Southern Lebanon where thermal vents have been discovered covering an area of 800m at a depth of 60m below sea level.