The Lebanese Ministry of Energy and Water (MoEW) has launched a comprehensive roadmap to address the country’s deepening electricity and water crises. The plan commits to overdue reforms, the expansion of power generation, and new regional partnerships to secure fuel and gas supplies.
According to the Minister of Energy and Water, the government has started implementing Law 462/2002, which requires restructuring the electricity sector and creating an independent regulatory authority. So far, 341 applications have been submitted for positions on the five-member body that will oversee sector reform.
Lebanon’s electricity production currently stands at just 1,200 MW—far below demand. To close the gap, the ministry plans to build modern natural gas power plants, replacing costly and polluting fuel oil. At least two gas-fired facilities are needed, with the first to be built under a Build-Operate-Transfer (BOT) model in partnership with the private sector. One 800 MW plant is expected to cost about US$800 million, with Lebanese law permitting BOT arrangements. MoEW will also coordinate with the World Bank to review tender terms and conditions.
Two options are being considered for gas delivery: reactivating the Arab Gas Pipeline—which links Egypt to Lebanon through Jordan and Syria—and deploying Floating Storage Regasification Units (FSRUs) to import and regasify liquefied natural gas offshore.
In parallel, the Minister noted that Electricité du Liban (EDL) collects only around 60% of expected revenues. Losses stem partly from technical inefficiencies in the aging grid (10%) and largely from electricity theft and illegal connections (30%). MoEW has asked EDL to develop a mitigation plan and has informed both the President and the Prime Minister. Addressing electricity theft will require security support across multiple regions.
Another key element of the reform agenda is reducing electricity costs. Lebanon’s tariff is among the world’s highest, averaging 27 cents per kilowatt-hour for high-usage households. The old, inefficient fuel-oil plants are a major contributor to these costs. Investments in 100–150 MW of solar generation capacity and a shift to gas are expected to help lower tariffs. According to the Minister, only coordinated investments in solar, gas, and grid modernization can reduce electricity costs for households and businesses.
Discussions are ongoing with Qatar regarding potential energy cooperation, including initiatives that are still at an early stage. In addition, the Minister and the Finance Minister recently traveled to Iraq to secure continued fuel supplies despite Lebanon’s outstanding arrears of US$1.2 billion. Payments are being managed via a Central Bank mechanism allowing Lebanon to settle in local currency by providing services such as healthcare. Three contracts have been signed to date, including a 2021 agreement worth US$500 million. The two countries are also studying the possibility of restoring an old pipeline connecting Iraq to Tripoli through Syria, pending technical and financial evaluation.
The ministry is concurrently addressing hazardous materials stored at the Zouk, Tripoli, and Zahrani power plants. Samples have been sent abroad for safe disposal, with more details to be released later.
Finally, the ministry is awaiting a report from TotalEnergies and its consortium partners—Italy’s Eni and QatarEnergy—regarding exploratory drilling in offshore Block 9. Once the findings are reviewed, the next steps will be determined.
Source: Lebanon Weekly Monitor
