The current state of the energy sector in Lebanon is worrying. Daily power cuts coupled with Electricite du Liban (EDL)’s chronic budget deficit, which has contributed to more than half of Lebanon’s public debt, makes it clear why reforming the sector is a top priority for the international community, and why it cannot be separated from the macro-economic reform package being negotiated with the International Monetary Fund (IMF). The reform of the electricity sector rests on two pillars: improved governance and the transition to sustainable, efficient and clean power production. Given the central bank’s dwindling hard currency reserves that make the long-standing subsidies of electricity impossible to maintain , the main challenge for the current government is keeping the lights on. Energy production Annual transfers from the government to EDL have averaged 3.8 percent of Lebanon’s gross domestic product over the last ten years, amounting to half of the annual
