|In theory, Lebanon is well positioned to take advantage of renewable energy technologies. Its sunny climate would allow for the widespread use of solar thermal collectors to heat water and its varied geography provides several prime areas for wind farms. A developed renewable energy infrastructure in Lebanon could bring millions of dollars to Lebanon through the Kyoto Protocol’s carbon trading system, and yet Lebanon lags drastically behind its European and Arab neighbors in renewable energy production and lacks a national renewable energy strategy.|
Lebanon currently imports 99% of its energy needs from countries rich in oil and gas. Skyrocketing oil prices in recent years without subsequent rises in electricity costs have pushed the country’s government-owned energy provider, Electricité du Liban (EDL), further into deficit while the service quality has worsened. Indeed, in 2007 EDL reported a record-high $1.2 billion shortfall, while power cuts extended to every region in Lebanon, sometimes for as long as 18 hours per day.
Yet despite EDL’s poor performance, the initiatives that have been launched to tap Lebanon’s renewable energy potential have been almost uniformly small in scale, largely because of the technical difficulties and disincentives that bar non-governmental organizations from entering the market. Most notably, EDL actually sells electricity well below market cost, which discourages renewable energy initiatives. Additionally, according to Wael Hmaidan, the executive director of environmental NGO IndyAct, “there is a huge waste of electricity in Lebanon due to inefficiency and low levels of awareness.”
Need for regulation to adapt
Equally importantly, Lebanon lacks a functioning feed-in law that would allow private entities to produce electricity by renewable technologies and then sell it to EDL by connecting directly to the national power grid. Leaders in renewable energy technology, such as Germany and Japan, have laws that compensate private citizens for providing energy to national grids, in addition to the tax breaks that individuals and companies receive to offset the start-up costs of switching to renewable energy.
The learning curve of renewable energy
It is often private citizens who bring renewable energy to Lebanon, and the windmill that currently stands on a cooperative game and agricultural farm in Qab Elias, a village in the eastern Bekaa, is one such example.
This windmill came to Lebanon from an academic laboratory in the Netherlands in the late 1990s. Realizing that it would need extensive work before becoming operational in Lebanon, the Dutch research center sold the windmill to the Lebanese farm at an attractive price. The hope was that the technology developed at Qab Elias would then serve as a prototype for other farms in less-developed countries looking to produce wind energy.
As such, a team of Lebanese engineers, agricultural experts and renewable energy enthusiasts, led by Ramzi Abi Said, worked to convert the windmill for independent electricity production, rather than to be plugged onto the national electricity grid, as it was originally designed. In doing so, they also reduced the amount of electricity that would be produced from 1000 volts DC to 380 volts AC. At that time, such conversions were still in their infancy, and it was the first time that such engineering was undertaken in Lebanon.
Despite the project’s novelty and the team’s efforts to involve state actors, no national government authority ever came to observe the windmill. Likewise, even academic institutions that initially had expressed interest in examining the windmill’s conversion and use never launched a formal study.
The windmill now channels electricity directly to underground pumps that serve to irrigate the farm. Yet the team soon learned that Qab Elias was not the ideal place in Lebanon for creating wind energy. Since consistent wind speeds of 8 meters per second are needed to produce electricity, it is only operational during the summer months in the early morning and for approximately 4-5 hours in the afternoon.
Even with its limited use, Abi Said stressed the importance of the Qab Elias windmill. “The experiences we gained and the mistakes that we learned from gave us the know-how to further develop the technology in Lebanon.”
Technically speaking, Lebanon does, in fact, have a feed-in law, but it stipulates that a regulatory council must be created to monitor non-governmental bodies supplying electricity to the grid. Yet this never happened. The Ministry of Energy was temporarily given the power to regulate private energy production, but its mandate expired in November 2007, before any real progress was made. It thus remains illegal for any entity other than EDL to supply energy to the national grid.
In the absence of a government program to promote renewable energies, the private sector and local NGOs, in cooperation with international partners, have taken the initiative to develop Lebanon’s renewable energy potential.
Ahmed Houri, a professor of chemistry at Lebanese American University (LAU), cautions that any renewable energy solutions must be economically effective in order to be adopted by consumers or pursued by the private sector, especially without a government incentive program. The most cost-effective and technologically mature options are thus solar thermal collectors to heat water and wind power, which are both already in wide use in countries whose climate and geography resemble Lebanon’s. For example by 1999 in neighboring Cyprus, 92% of homes heated their water through solar technology, whereas Houri found that in 2003 only 2.8% of Lebanese household were equipped with such technology.
According to Jean-Paul Sfeir, the owner of Solarnet, a company that installs solar thermal collectors, since 2005 demand in Lebanon has exploded. Since then his business has expanded by more than 30% each year, and will likely grow significantly faster this year – perhaps by as much as 70%. Private homes, large apartment buildings, hotels, hospitals, orphanages and convents have all expressed interest in converting to solar power to heat their water.
Sfeir credits this recent growth to the maturing Lebanese market and the high price of fuel. “By 2005, Lebanese companies installing solar water heaters had been operating for several years and had perfected their skills. At the same time, the high price of oil on the global market pushed people to explore renewable energy technologies,” Sfeir said.
Yet despite the recent solar technology boom, Lebanon still lags far behind its neighbors. Without government mandates and incentives for solar water heaters that exist in other Mediterranean countries, high installation costs mean that solar technology remains a luxury. A solar water heater typically costs between $1,000 and $2,000 to install, putting them out of reach for most Lebanese families.
Improving access without government
The private and NGO sectors have, however, played a major role in making solar water heaters accessible to middle and low-income households. Banks, including the Crédit Libanais and the Lebanese-Canadian Bank have offered low-interest loans for water heaters, and HSBC is currently giving solar
water heaters to customers with new home loans. International donors have made renewable energy a cornerstone of their development programs in Lebanon, with the Chinese, German and Spanish governments all partnering with local municipalities and NGO’s to bring solar energy to poor communities, including those that were most affected by the July War. The Salah Ghandour Hospital in Bint Jbeil, for example, now heats its water through solar technology.
While households and businesses are limited to solar water heaters, the private sector is seeking to capitalize on the carbon-trading market created by the Kyoto Protocol, which requires industrialized countries to cut their emissions by 5.2% below 1990 levels by 2012. Rather than limit their emissions domestically, countries can buy carbon credits by sponsoring a renewable energy project in the developing world. Although still relatively immature, carbon trading was a $40 billion industry in 2007 and is expected to grow to $63 billion this year.
Sustainable Energy Systems (SES) is the Beirut-based Middle Eastern partner of EcoSecurities, an Irish company that trades carbon credits. EcoSecurities allows industrialized countries to buy carbon credits from its portfolio of 400 renewable energy projects in 27 countries rather than sponsoring individual projects in developing countries whose precise annual results are unpredictable. Such projects include electricity production by wind farms or biomass generation. These projects can create jobs in developing countries and significantly reduce their energy costs, all while improving their environment.
The process for presenting such a project to the United Nations for approval is extremely laborious. SES thus submits applications for renewable energy projects on behalf of national governments, managing the UN bureaucracy and using its resources to complete third party reviews of projects more quickly. “There are so many new projects that just waiting for project review by the Designated Operational Entity (DOE) can take six to eight months,” said Salah Tabbara, SES’ general manager. “But because we have so many projects around the world, we have a certain priority with the DOEs and can often have our projects reviewed in between four weeks and three months.” Several projects have already been submitted to the Lebanese Ministry of Environment for approval, but none has moved forward because of the country’s continuing political crisis.
Political deadlock stalling growth
The government’s current paralysis has also affected other private sector initiatives. Lebanon Winds is prepared to invest approximately $100 million in a wind farm in Akkar that could produce 2% of Lebanon’s total electricity at low, stable prices. Although it has signed a memorandum of understanding with the government, it cannot sign a purchase agreement with EDL until the current political crisis is resolved. “Our principle obstacles to beginning production are administrative,” said the company’s Robert Debbas.
Even with the enthusiasm of the private sector and international donors for renewable energy, Ali Darwish, director of the environmental NGO Greenline, is “almost certain that this is all a lot of fuss about nothing.” Until there is direct governmental intervention, projects will remain small in scale and isolated in location. And even though international donors are excited to fund renewable energy projects in Lebanon, they are often unwilling to pressure the government to change its energy policies substantially. “NGOs can lobby, can build initiatives and can apply pressure to make things move,” says Darwish. “But at the end of the day, NGOs cannot replace the government.”