Pend­ing po­lit­i­cal ap­proval, in­vest­ment in re­new­ables awaits

Pend­ing po­lit­i­cal ap­proval, in­vest­ment in re­new­ables awaits

Executive Magazine - - Front Page -

Le­banon could li­cense the con­struc­tion of nearly 380 megawatts ( MW) of re­new­able en­ergy plants as early as this sum­mer, a Min­istry of En­ergy and Wa­ter (MoEW) of­fi­cial tells EX­EC­U­TIVE. This would mean a rise in gen­er­a­tion ca­pac­ity of just over 20 percent — a far cry from sat­is­fy­ing the coun­try’s de­mand for power. This clean elec­tric­ity, gen­er­ated through new wind­mill in­stal­la­tions and so­lar farms, would, how­ever, help Le­banon reach its 2020 tar­get of 12 percent re­new­able en­ergy in the na­tional power mix. Com­pa­nies would need to raise cap­i­tal to fi­nance con­struc­tion of the projects, a not- so- dif­fi­cult prospect thanks to a 2010 cen­tral bank in­cen­tive and spurred on by last year’s Paris Agree­ment on cli­mate change.

WIND’S PICK­ING UP

It is in a blus­tery part of north Le­banon that the gov­ern­ment en­vi­sions con­struc­tion of three wind­farms. Near Akkar, in the coun­try’s wind cor­ri­dor, ro­tat­ing tur­bines would gen­er­ate some 200 MW of clean elec­tric­ity if the gov­ern­ment fi­nally li­censes their con­struc­tion.

The MoEW be­gan the ten­der­ing process back in 2013, short­list-

ing three bids. Four years on, “We’ve hope­fully come to the last steps,” says Pierre el-Khoury, head of the Le­banese Cen­ter for En­ergy Con­ser­va­tion (LCEC), the tech­ni­cal body at the MoEW re­spon­si­ble for re­new­ables.

Elec­tric­ity Law 462, rat­i­fied in 2002, stip­u­lated that a reg­u­la­tor would li­cense new power plants, but the gov­ern­ment never got around to ap­point­ing that body. In­stead, Par­lia­ment passed leg­is­la­tion in 2014 and 2015 to get around the leg­is­la­tion by al­low­ing cab­i­net, on the rec­om­men­da­tions of the MoEW and the Min­istry of Fi­nance, to de­cide when the pri­vate sec­tor could build power plants. Now, Khoury tells Ex­ec­u­tive, the wind­mills are wait­ing for ap­proval from the Min­is­ter of Fi- nance so that both min­istries can ask cab­i­net for the per­mits.

In ad­di­tion to the 200 MW of wind en­ergy, the MoEW also wants to li­cense up to 180 MW of so­lar. At the be­gin­ning of 2017, the min­istry asked for ex­pres­sions of in­ter­est (EOI) for the con­struc­tion of 12 so­lar farms, con­sist­ing of three projects each in the districts of South Le­banon, Mount Le­banon, Bekaa Val­ley, and North Le­banon. The EOI call re­sulted in 265 project pro­pos­als sub­mit­ted by 173 com­pa­nies, Khoury says. “Based on this high rate of replies, the MoEW fi­nal­ized the ten­der doc­u­ments and sent a re­quest ask­ing [com­pa­nies] to sub­mit de­tailed of­fers.” Khoury says the dead­line to sub­mit bids is midAu­gust, ad­ding that the min­istry needs to move quickly. “It will take us some time to re­view these of­fers. But

In­vest­ing in largescale re­new­ables is a re­al­is­tic op­por­tu­nity

we need to fi­nal­ize the whole process be­fore April 2018,” as that is when Cab­i­net’s man­date to li­cense new pri­vate sec­tor power plants ex­pires.

A NEW DAWN AP­PROACHES

If the Coun­cil of Min­is­ters does end up li­cens­ing the wind­mills this sum­mer, and the so­lar projects be­fore April 2018, then com­pa­nies will need to fi­nance the cost of con­struc­tion.

That does not seem like much of an ob­sta­cle. In 2010, Banque du Liban (BDL), Le­banon’s cen­tral bank, moved to spur in­vest­ment in re­new­ables by cre­at­ing a fund­ing mech­a­nism known as the Na­tional En­ergy Ef­fi­ciency and Re­new­able En­ergy Ac­tion

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