Lebanon’s Unpaid Bills Will Worsen The Electricity Crisis

Unpaid Bills May Worsen Lebanon's Electricity Crisis

The severe outages that Lebanon is witnessing today are expected to worsen in the near future as a result of unpaid bills by the government, a new report suggests.

Nearly a quarter of the Lebanese state’s electricity generation comes from the Turkish company, Karpowership, which provided the country with the two power ships that have been anchored off the Lebanese coast since 2013.

Under normal circumstances, these ships provide nearly 400 MW of Lebanon’s “normal” demand of 2,000 MW, which is not nearly enough to power the country properly.

According to Bloomberg, the Turkish firm’s contract with Lebanon expires in 2021, and the latter might find itself unable to secure a renewal because of its overdue payments.

“We chose not to suspend power generation as long as fuel is delivered” to the ships by Lebanon’s state electricity provider, said the company’s COO, Zeynep Harezi.

“That being said, we will hope that Lebanon will be able to get back on their feet soon and catch up on their payments,” Harezi added.

As for the Lebanese side, Energy Minister Raymond Ghajar said that the problem stems from “our inability to pay in fresh dollars.”

The Minister argued that the owed sum, around $100 million, would be paid without issues, “if they would be willing to get paid in Lebanese pounds,” which they seem to refuse, understandably.

The fuel crisis is already rendering the energy sector near-paralyzed and the effects have often become unbearable by the Lebanese, whose backup plan of private generators has failed them as well.

With no solution to the pressing dollar crisis on the horizon, Lebanon may find hope in the form of foreign investors interested in its electricity sector.

However, amid its ongoing economic meltdown, and without securing the International Monetary Fund’s bailout, the country probably has little chance of attracting investors, as Economy Minister Raoul Nehme has indicated.

With a large portion of the population deemed to fall below the poverty line in the near future, how much darker can Lebanon get?

Already, on the ground, people are diverting their fury at the lack of power to their back up plan: The generator owners, who are now also failing to deliver.

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