Lebanon’s electricity crisis fuelled by decades of mismanagement

The Lebanese state is becoming a confederation of cartels that have hijacked the country and its resources.
Sunday 12/08/2018
An electricity-generating ship from Turkey docks at the port of Jiyeh in southern Beirut. (Reuters)
Chronic scandal. An electricity-generating ship from Turkey docks at the port of Jiyeh in southern Beirut. (Reuters)

During Lebanon’s 15 years of civil war, no person was perhaps more despised than Mosbah Natour. Natour was neither an infamous warlord nor was he responsible for the death or physical harm of any of his fellow Lebanese. No, Natour was the director-general of Lebanon Electricity (EDL), which the Lebanese, mostly unfairly, held responsible for repeated and crippling power cuts that plagued the country throughout the war.

Twenty-eight years have elapsed since the end of the civil war and the Lebanese still struggle with basic utilities. Many regions experience power rationing, which, during the peak of summer, can stretch to 20 hours a day. Despite investing more than $36 billion since 1992, the Lebanese state has failed to reform or improve the electricity sector, which costs taxpayers $1.2 billion annually.

As a result, the Lebanese have looked towards non-state suppliers for their electricity needs and have consequently fallen prey to the machinations of private generator providers. The owners of neighbourhood generators have coalesced into a cartel, which nets $2 billion a year in profits and which, alarmingly, has shown itself capable of blocking any plan for the country’s long-term electricity supply.

This electricity cartel recently refused to recognise the measures imposed on it by the Ministry of Energy and Water and the Ministry of the Economy, requiring consumers pay a standard tariff and providers install metres to measure consumption. Audaciously, the providers, knowing the sway they hold over the public, threatened to cut the supply if the measures were forced on them.

The mutiny of the generator owners was exacerbated by the fact that the state’s alternative, the EDL, has been struggling to consistently provide power, with the country’s plants lying in ruin after years of corrupt maintenance contracts went largely ignored.

Subsequent power shortages have led the Minister of Energy and Water Cesar Abi Khalil to expand on his plan of leasing Turkish power-generating ships to compensate for the electricity shortage, a deal that was rejected by many in the government on the grounds of transparency and, above all, its risk of adding to the sector’s inefficiencies.

Abi Khalil, who belongs to President Michel Aoun’s parliamentary bloc, furiously defended his party’s choices, characterising the decision to lease more ships as giving the state breathing room to construct power plants. Abi Khalil’s illogical plan, however, is riddled with inconsistencies, because the $800 million allocated to leasing the ships could be diverted to more sustainable projects, such as repairing or enhancing the country’s distribution network.

The primary opponent to the ship deal is Speaker of the House and leader of the Shia Amal Movement Nabih Berri, who recently refused to allow a third generator ship to dock in the southern seaport of the Zahrani power plant. Amal’s refusal to integrate the ship into the plant’s network deprived the area of much-needed hours of additional electricity, something Abi Khalil used as a pretext to attack Berri and accuse him of protecting the country’s electricity cartel.

The issue goes beyond merely a corrupt ship deal or a standoff with greedy generator owners. It is remarkable how all sides in this confrontation — including Berri and Aoun — portray themselves as victims of the elite while demonising their opponents as corrupt enemies of fair energy provision and the distribution of other basic services.

Contrary to what the political class tries to uphold, members of this so-called generator cartel are not extraterrestrials nor are they separate from the corrupt political junta that has run the country for two decades. None of these generator owners would dare cross the state or even contemplate holding the people hostage had they not first been endorsed and protected by sectarian leaders.

The sectarian leaders are the same ones who have held the portfolio of power and energy or similar ministries and squandered away $36 billion of taxpayers’ money while failing to provide the country with electricity.

The Lebanese state, as it crumbles today, is becoming a confederation of cartels that, with the blessing and endorsement of the Lebanese themselves, have hijacked the country and its resources and taken the state and its economy down a fathomless pit.

Blaming anyone else for this predicament and any economic collapse is as deceptive as blaming the hapless Mosbah Natour for crimes he did not commit.