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French Version

Energy plans fail to address citizens' concerns - Sector plagued by high prices, unreliability (Daily Star)

Like so many well-intentioned
conferences held here, the seminar
on Energy Policy and Strategy
Development for the Republic of
Lebanon began with long speeches
about future projects that promise
to tap untold potential and rescue
the country from its current economic recession.

But Tuesday's discussions, which featured an upbeat speech from the energy and water minister, failed to address the immediate concerns of millions of average Lebanese citizens who - after 13 years of peace and reconstruction - are paying some of the highest electricity bills in the world for a service that can only be described as unparalleled in its unreliability.

Far away from the smoggy city streets, snug in the comfortable interiors of a luxury hotel, European energy experts recommended long-term strategies such as integration with regional power grids, consumer efficiency guides and new energy-saving building codes.

Edging a step closer to reality, Energy and Water Minister Ayoub Humayed expressed optimism about plans to convert the country's fossil fuel consumption into natural gas, a move that is expected to help rescue Electricite du Liban (EDL), which is currently losing about $400 million per year.

Humayed said plans for building pipelines, which will connect the country's power stations to natural gas sources in Syria and Egypt, will be ready for tender "hopefully, very soon;" while a 10-year-plan to build hydroelectric damns is also pending. He then pinned the sector's fate, and that of the country as a whole, on recent studies showing the existence of "some natural gas reserves" in Lebanese territory.

"Hopefully the discovery of offshore and onshore oil reserves will help Lebanon escape its economic problems," he said.

But that assumption is far from certain, according to ministry advisor Georges Kamar: "We cannot tell if the quantities are commercial or not ... We need to drill to know the quantities," he later told The Daily Star, projecting that an exploration law could be passed by year's end.

Consumers should also expect a long wait before seeing any fruits from the plan to switch to natural gas, which will take at least another two years before saving EDL some $70 million to $80 million annually.

Kamar also said privatization plans have been shelved indefinitely, while a multi-million dollar EU-sponsored program to help reduce consumption has been frozen for unclear "political" reasons.

As the conference pressed on, European consultants continued to speak at length on the advantages of market liberalization and the lucrative possibility for solar energy projects. But participants representing the local energy sector argued that talk of future projects failed to address the status-quo of power outages, extraordinary fees and large-scale theft, which the ministry estimates to be at around 24 percent of total consumption.

"We should be looking at urgent reforms ... administrative reforms," said EDL board member Riad Chedid, who described Lebanon's seemingly perpetual energy crisis as a "vicious cycle," where citizens "are paying more and more and receiving less and less."

"There is a major difference between theory and what is happening in practice - we don't even have 24 hour electricity supply," exclaimed Hisham Abou Jaoude, energy specialist with the Association of Industrialists.

"You are putting us in an embarrassing situation," said Chafic Abisaid, a consultant with MSC Energy.

"We are facing some not very clear policy decisions," he added. "I'm trying to be as diplomatic as possible

After the conference, a high level EDL source told The Daily Star that nothing short of a complete overhaul of the national electricity company will translate into a reduction in prices for consumers.

"The bureaucrats and non-decision makers in charge of EDL are making these haphazard decisions. With this mentality, nothing is going to change. I'm never optimistic."

Beirut 17-05-2004
Habib Battah
The Daily Star

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