The world’s first solar-lit tunnel will soon be built in Lebanon. The only other venture into solar tunnels was in Belgium last year, but this project was for powering high-speed trains and not for lighting. Based in Chekka, the 400-meter long tunnel will be solar equipped by the end of July. The solar panels placed at the entrance and exit of the tunnel will replace the diesel generators while standard electricity remains in place. Though the cost of the project was not disclosed as Executive went to print, Marwan Zantout, chief executive officer of Lebanon-based Solarleb, the company behind the project, says, “The total cost of the project amounts to the cost the municipality spends on diesel for the tunnel in two years.” Zantout adds that he is excited about the project, his company’s second large-scale solar development in Lebanon. He says he believes that awareness for solar energy will rise as more large-scale government projects are realized.
Solarleb’s first solar venture was in the area of Hermel this year. After lobbying for more than two years — which included placing four demonstration poles near the Ministry of Public Works in September 2010 — Solarleb was granted a government contract to set up 670 solar street light systems covering 18 kilometers in Hermel, at a cost of $1.74 million to the government. The area covered had no electric infrastructure and conventional street lighting would have cost $2.5 million, according to Zantout, so the government ended up saving 25 percent by adopting solar. Solarleb has to maintain the project for a year, after which it falls in the hands of the municipality, but Zantout said he believes that the maintenance contract will be granted to them as “the municipality will not take care of it and they don’t know how to do it.”
Renewable fix for the shortfall
Lebanon produces 1,500 megawatts (MW) of electricity, though at peak times demand can exceed 2,500 MW. Zantout estimates these additional 1,000 MW could be filled with solar and wind energy, for a maximum cost of $2 billion (using an aggressive cost estimate of $2 per MW). “That is what Électricité du Liban (EDL) loses in a year,” he points out.
The ministry of finance transferred $1.7 billion to cover EDL’s deficit in 2011, representing 23 percent of the government’s total primary expenditures. As well, Zantout notes that the average cost per kilowatt hour (kwh) of solar energy he can produce is 12 to 14 cents, compared to EDL’s current cost of 17 cents per kwh and diesel generators’ cost of 23 cents per kwh, according to World Bank estimates.
Zantout points to several ways by which Lebanon could offload its electricity burden, highlighting three areas in Lebanon with significant potential of wind electricity production: Akkar, Marjayoun and Bekaa. “One could reasonably develop around 1,000 MW through wind farms in Lebanon,” says Zantout. As for solar, he advocates using micro installations: solar panels on rooftops of buildings. With high electricity costs to start off with, Zantout says he does not see the need for tax breaks or incentives, such as those adopted in countries already well advanced in renewable energy, among them Germany and Japan. “I may sound like a very bad salesman, but I do not see the need,” he says.
Zantout says he is also a strong advocate for ‘net metering,’ which he calls “a must in Lebanon”. Net metering is an electricity policy through which consumers can feed their unused renewable electricity to the national grid, or take from the grid extra energy when needed, and then pay for the difference. EDL is the sole provider of electricity to the country by law, though not practice, and thus curtails private companies from supplying energy to the national grid. However, a milestone was reached in December 2011 when EDL launched the net-metering system in Lebanon, and EDL’s general director Kamal Hayek stated last month that 21 customers had so far signed the net metering contract. The central bank is also on board, providing subsidized loans with low interest rates of 0.6 percent and long repayment periods of up to 14 years to boost the installation of renewable energy systems.
With an ambitious target set at the Copenhagen Climate Summit to produce 12 percent of total electricity through renewable energy by 2020, Lebanon’s renewable energy “to do list” is extensive. Zantout has high prospects for Solarleb, which is engaged in wind and recycling too. He says the company generated $3 million in revenues last year, its third year of operation, and a net income of $600,000. He says he expects revenues to grow 50 percent over the next five years as many more projects — which he did not disclose — are in the pipeline. He believes the projects put in place this year will create awareness and Lebanon should eventually become more open to adopting solar energy.
“Lebanese people are scared to try something new, they always feel there is a catch while there is no catch,” says Zantout. “When they see a solar street light always on, it will become reality, it will create awareness and it should work towards increasing the adoption of solar energy.”