when a barrel of oil cost USD 23 (Reuters, 2019), and collection rates remain low, while the inefficiencies on the system (notably network leakage) lead to loss in efficiency and supply (World Bank, EU and United Nations, 2020). Technical and non-technical losses amount to a third of EDL’s generation. A study on willingness to pay for renewable energy in Lebanon showed that a significant amount of income (around 16 per cent) is already earmarked electricity and hot water (UNDP, 2015). Many individual and business respondents had poor knowledge of renewable energy. Amongst residents, the main reasons for not being willing to pay for renewable energy was that it was not of interest and that the government should pay. More than half of businesses were willing to pay to undergo energy efficiency measures. The highest interest in renewable energy was if it could replace diesel generators, where most business owners rent or own diesel generators currently. LPG is used by households for cooking, using liquid cylinders and for space and water heating. It is also used in industries, commerce, and public services.
City-level energy access: Inequitable, unreliable, and lacking The provision of energy in Lebanon is uneven and reflects socio-cultural divisions and inequity. Many poor and disenfranchised areas, such as the Palestinian camps, receive far less energy than other areas of the cities. For example, Shatila, one of the Palestinian refugee camps in Beirut, is connected to the Mount Lebanon network but has far less access to energy than neighbouring areas. Moreover, electricity provision in Beirut has been severely affected by recent shocks. From previously being without electricity for a few hours a day, this has increased to large parts of the day. The lack of access to affordable and reliable electricity forces many to connect illegally. There is thus a prevalence of dangerous connections in some of the poorest neighbourhoods. In Burj Barajneh Palestinian camp there have been cases of death by electrocution from encountering damaged electrical wires. Assessments of living conditions for Syrian refugee families have shown that some put electrical wires directly into pots to heat water.
Box 8: Zahle city and its 24 hours electricity provision. Zahle city has established its own service provision of electricity. In Lebanon this is a unique case. While it is a success story in terms of providing reliable electricity to the residents 24 hours a day prior to the fuel crisis, it is also a story of how rent-seeking is shifted from a central to a local level rather than being disposed of in the new system. The opportunity to set up a decentralised system for electricity generation has only been made possible as a result of specific historic and political conditions combined with successful mobilisation of residents. How does it work? When EDL electricity is available, Électricité de Zahlé (EDZ) is purchasing the electricity at a heavily subsidised rate and reselling it at a much higher EDL tariff. When EDL electricity is not available, private emergency power contractor EDZ-Aggreko, provides electricity. EDZ collects 100 per cent of electrical bills and provide electricity at cost that is competitive with the private generators that back up EDL supply. Unlike private generators who rely on their own low-quality grid, the EDZ-Aggreko supply is connected to the medium-quality EDL grid. The system has eliminated blackouts, and consumers are provided with an integrated billing. Access to reliable electricity 24 hours a day is benefiting households and small businesses, particularly women managing domestic affairs. In a study on Zahle, people benefiting from this access reported feeling of dignity and humanity amongst the benefits. Clean energy EDZ has encouraged the development of solar power and has installed significant net-metering technology. As of June 2020, EDZ had 8 MW of solar photovoltaics (PV) capacity connected to its grid, around 10% of EDZAggreko’s total installed capacity. While Aggreko offered to incorporate solar systems in their generation, EDZ refused because the relatively long contractual timeframe required by Aggreko was inconsistent with the highly uncertain policy and regulatory context that EDZ faced. In addition, a shift towards renewables-based power generation would impact EDZ’s business with powerful local diesel fuel suppliers, creating an additional layer of resistance. The Zahle case suggests there is market demand for higher-priced electricity if this is reliable and good quality. This would necessitate to raise the price that concessions pay to the EDL for their power to something that approaches the price at which EDL sells to costumers. However, the continued corruption and the lack of financial sustainability of this model that does not allow for scaling up of the model, even if the political will was there (Ali Ahmad et al, 2020). 29
