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Lebanon to sign electricity deal with Jordan next week, says minister

AFP / Beirut

Friday، 21 January 2022 09:47 PM

Crisis-hit Lebanon will sign a deal with Jordan next week to bring in electricity via Syria to help ease gruelling power cuts, the energy minister has told AFP.
The agreement, which comes as the country grapples with round-the-clock power outages, is part of a wider government effort to eventually provide state electricity for eight to 10 hours a day, up from just two now in most parts of the country.
“The deal is important primarily because it will increase state power supply, which is cleaner and cheaper” than electricity produced by “expensive and polluting private generators”, Walid Fayad told AFP in an interview on Thursday.
The minister said a visiting Jordanian delegation would sign the deal in Beirut next Wednesday before heading to Damascus, where Jordanian and Lebanese officials are set to ink a transit agreement with Syria.
The deal will provide Lebanon with up to 250 megawatts of electricity during the day and 150 megawatts at night, equivalent to a total of two additional hours of power, Fayad said.
Two years into Lebanon’s economic meltdown, the cash-strapped state is struggling to purchase fuel for its power stations.
With state power effectively non-existent, many rely on private generators, but prices have increased after the government lifted fuel subsides.
Lebanon has been importing fuel oil from Iraq to operate its power plants in recent months.
The government is also in talks with Egypt to import gas through the Arab Gas Pipeline, which passes through Jordan, Syria and Lebanon.
Beirut and Cairo are currently finalising commercial agreements so that the two sides can sign a deal by spring, according to Fayad.
He said the energy accords would not violate US sanctions that forbid financial dealings with the government in Damascus.
Syria would receive gas and power from Egypt and Jordan as “in-kind payment, not monetary payment”, he said.
But Egypt, he added, is still waiting for US confirmation that an agreement would not trigger “any negative repercussions” before finalising a deal.
By importing Jordanian electricity, Iraqi fuel and Egyptian gas, Lebanon hopes to boost power output to eight to 10 hours a day in the coming months, Fayad said.
Lebanon’s crumbling electricity sector has cost the country more than $40bn since the end of its 1975-1990 civil war.
“The solutions we are proposing will quickly boost power supply and will provide a sustainable solution for the country, especially with regard to Egyptian gas,” Fayad said.
Importing electricity from Jordan will cost about $200mn per year, he added, while importing gas from Egypt will cost about the same amount.
“We secured an initial $300mn from the World Bank and we are working to secure an additional $100mn,” Fayad said.
The international community has long urged Lebanon to undertake major reforms, including the overhaul of its electricity sector, to access billions of dollars in financial support.
Successive government have failed to cut down on losses, repair crumbling infrastructure or even collect electricity bills regularly across the country.
State power tariffs will rise with the increased supply, Fayad said.
Lebanese currently pay 0.5 cents per kilowatt-hour, one of the lowest tariffs in the world.
Raising prices is one of the World Bank’s conditions for the loan, Fayad said, adding that state electricity bills would still be cheaper on average than private generators.

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