Lebanon Businessnews News

Poor electricity awaits political consensus
Bassil’s $1.2 billion bill splits cabinet, critics demand energy regulatory body
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The Council of Ministers still hasn’t taken a decision on the energy bill submitted by the Change and Reform bloc ministers. The cabinet agreed to adjourn the session till September 7, after the Fitr holiday.

The proposed draft law grants the Minister of Energy and Water, Gebran Bassil, access to $1.2 billion to build power plants to supply 700 additional megawatts for the country. The electricity bill – which is actually an excerpt of a comprehensive energy reform plan adopted in 2010 - stirred a political row in the cabinet after having been blocked in parliament by the opposition and some members of the majority.

MP Mohamad Kabbani, member of the parliamentary committee for Energy and Public Works, has called for the establishment of a regulatory body to monitor the electricity sector, as stipulated in Law 462 issued in 2002. According to the said Law, the regulatory body would consist of a president and four members appointed by the cabinet according to the suggestion of the Minister of Energy and Water.

Both President Michel Sleiman and Prime Minister Najib Mikati agreed that resolving the country’s long-enduring electricity shortfall should be made through consensus among all cabinet groups.

“Though not the best, Bassil’s plan is good and will provide seven hours of power supply across the country,” economist Louis Hobeika said. He said that the energy plan was approved by all ministers in former Prime Minister Saad Hariri’s government and should not be held back now.

Former Minister of Finance and economist Jihad Azour said that the electricity reform plan, as it was decided by the previous cabinet, is acceptable and should be implemented. “Once we’ve started implementing the plan, we could depict the weaknesses and work on them,” he said.

Azour said that the problem is in distributing the additional 700 megawatts of electricity, knowing that the network has the capacity for 400 megawatts. “We must acknowledge that when distributing this much energy, 42 percent of the generated power would be wasted,” he said. The electricity sector costs the Treasury around $1.5 billion per year in deficit.
Date Posted: Aug 26, 2011
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