Minister of Power reports on
developments in the power sector
Announces boycott of Cabinet meetings
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Summary of the press conference delivered by Joe Saddi, Minister of Power and Water Resources.
Core problem: Capacity deficit and historical context
• Production deficit: The fundamental issue facing the sector is a lack of power generation capacity. Existing power plants currently supply approximately one-third of total national demand.
• Private generators: This production deficit has forced reliance on private neighborhood generators for the past 20 years.
• Misallocated resources: Over $25 billion of depositors' funds were spent on fuel fuel combustion instead of investing in constructing power plants of adequate size.
Private sector engagement and IFC partnership
• Private-led strategy: The primary approach from the beginning has been to rely on private sector investments to build and operate the needed power plants.
• Role of the IFC: The government tasked the International Finance Corporation (IFC)—part of the World Bank Group—to guide this process. The IFC conducted legal, technical, and financial feasibility studies and engaged international Independent Power Producers (IPPs).
• Investor response: Out of these global contacts, only four to five international companies expressed interest in investing in Lebanon, subject to specific conditions.
Investor conditions and required financial guarantees
• Security and stability: Investors require security guarantees and political stability before committing $1 billion to $3 billion in a country facing weapons and war.
• Financial sustainability of Électricité du Liban (EDL) : Investors demand that EDL stand on its own feet through its own resources. This requires:
o Dynamic/Flexible Tariff: Implementing a tariff that adjusts upward or downward in sync with global fuel prices (a long-discussed reform).
• Addressing non-technical losses (Theft) :
o Unaccounted losses stand at 30%, which the Minister explicitly terms "theft."
o Investors question how EDL can pay them when 30% of produced electricity is stolen.
o The Electricity Regulatory Authority (ERA), in collaboration with the World Bank, completed a study recommending a total reorganization of the distribution and collection sector (a model similar to, though distinct from, the Zahle model).
• Diplomatic support: Friendly nations prepared to invest in Lebanon demand the exact same financial guarantees as private sector investors.
Transition to natural gas and infrastructure
• Strategic importance: Switching power generation to natural gas will significantly lower production costs.
• Jordan and Syria gas agreements:
o Gas purchase, transit, and swap contracts have been arranged with Jordan and Syria.
o The Minister referred these agreements to the Cabinet Secretariat roughly three weeks prior for approval.
• Pipeline rehabilitation:
o The pipeline connecting Deir Ammar to Dabboussiya (on Syrian territory) completed its rehabilitation the previous week.
o Special thanks were expressed to the State of Qatar for funding the second phase of pipeline rehabilitation.
• Next steps for gas conversion:
1. Cabinet authorization: Cabinet must approve and grant the Minister the authority to sign the gas contracts.
2. Technical recommissioning: Siemens experts must return to Lebanon to re-configure the Deir Ammar plant to operate on gas.
• Floating Storage Regasification Unit (FSRU) :
o Advanced work is underway regarding an FSRU, with tenders expected soon.
o Strategic independence: An FSRU ensures Lebanon is not tied to a single source, granting it the flexibility to import gas by land or sea without becoming hostage to any single entity.
Electricity imports (Syria and Turkey)
• Syria import contract:
o A contract to import 150 MW of electricity was received from the Syrian side.
o The Minister referred it to the EDL Board of Directors for review and is awaiting their evaluation.
• Turkey import proposal via Syria:
o Discussions are ongoing with Turkish officials to supply electricity from the north through Syria.
o During his recent trip to New York, the Minister met with the Turkish Minister for the second time in a month to request that Turkey coordinate technically with Syria regarding this power transfer route.
Regulatory authority and renewable energy initiatives
• Regulatory milestones: The Electricity Regulatory Authority (ERA) has completed several tasks, including assisting with the sector policy paper, the World Bank distribution study, the generation master plan, and the transmission master plan.
• Expression of Interest (EOI) for smaller plants:
o The ERA launched an EOI (closing 10 days from the press conference) for private investments in smaller power plants (50 to 100 MW) operating on fuel/gas, as well as solar power plants.
o Approximately 20 companies have submitted proposals across conventional and renewable energy tracks.
• Wind power licenses in Akkar:
o Movement is underway regarding wind farm licenses in Akkar. A serious investor is ready to purchase licenses from current holders and activate the project, pending formal paperwork and proposals.
Current sector crisis: Global fuel prices and supply cutbacks
• Global oil crisis: Global fuel market volatility directly impacts Lebanon.
• Doubled fuel costs: The price of fuel imported by EDL doubled over the preceding six months.
• Impact on supply:
o With steady collection levels (which actually dropped due to war conditions), EDL's fuel purchasing power was cut in half (purchasing only 50% of previous fuel volume).
o Consequently, daily power supply dropped from 7 to 9 hours (achieved in February through self-generated revenues without treasury advances or loans) down to 2 to 4 hours.
Immediate measures to increase daily power hours
• Target supply: The goal is to raise daily power supply from 2–4 hours to 4–6 hours, directly reducing citizens' reliance on expensive private generators.
• Cost savings analysis:
o Even under a dynamic tariff, utility power remains far cheaper than private generators.
o 1 additional hour of EDL supply saves Lebanese citizens at least $20 million monthly ($240 million annually).
o 2 additional hours saves approximately $500 million annually.
Financial requirements from the Government
To increase production to 4–6 hours daily without treasury loans, the Minister demands that the government meet three financial obligations ($50 million/month in additional fuel costs):
1. State dues and public sector bills:
o Public institutions must pay their electricity bills just like any private citizen.
o Current government arrears to EDL stand at approximately $300 million. (Only one month was settled at $50 million before payments stopped).
2. Compensation for South Lebanon exemptions:
o Exempting residents in Southern Lebanon from electricity and water fees due to war conditions is fully justified.
o However, legally, the central government must compensate EDL and the South Lebanon Water Establishment for these exemptions so they can purchase fuel.
3. War damage repairs:
o Repairs to war-damaged infrastructure must be funded directly by the state budget, not drawn from the operating capital of utility institutions.
Clarification on Zouk and Jiyeh power plants
• Historical context: Both plants were offline during 2022, 2023, and 2024, before operating briefly in 2025.
• Current status in 2026: A dispute exists between EDL, operators, and fuel suppliers.
• Available operational capacity:
o Only 5 turbines across both plants are currently operational.
o Existing fuel reserves can only run these 5 turbines for 1 to 1.5 hours daily for 3 to 4 weeks maximum.
• Pending resolution: The issue is currently before the EDL Board of Directors, and the Minister has requested an expedited resolution.
Boycott of Cabinet sessions and public demands
• Customs duty request: The Minister requested suspending the LL300,000 Customs duty/tax on gasoline until the end of the year to relieve financial pressure on citizens.
• Cabinet boycott announcement:
o After repeatedly raising these electricity demands (settling government bills, south exemptions, war repairs) before the Cabinet without response, the Minister announced his decision to boycott Cabinet sessions until these decisions are taken.
• Operational continuity: The Minister clarified that daily work and reform projects inside the Ministry will continue uninterrupted.
• Responsibility: He stressed that the energy crisis is a collective responsibility belonging to the entire government, not just his ministry.
Q&A: Boycott vs. Resignation
• Clarification on boycott: Responding to reporters asking if the boycott hints at an upcoming resignation, the Minister stated that boycotting is not an evasion of responsibility, but an act of taking responsibility to highlight the problem and force solutions.
• Conditions to return: He will return to Cabinet meetings once the government takes the requested decisions to support citizens in the short term, pending broader regional stability, fuel price stabilization, and the adoption of a dynamic tariff.
Date Posted: Oct 07, 2026
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