Law voted on private electricity production

Regulatory Authority to
manage process once created

The Parliament enacted on April 10 a law allowing the government to grant power production permits to private firms. This law is temporary as it will be applied for two years, until the power Regulatory Authority is formed. The 2002 electricity law allows private companies to produce and sell electricity to the State-run EDL, provided the process is managed by a Regulatory Authority, which has not been created yet.

MP Mohammad Kabbani, chairman of the Parliamentary Energy and Public Works Committee, said: “This law would save the Treasury $2 billion per year.” In 2013, the Treasury transferred around $2 billion to the EDL, in order to cover its deficit. The law will trim down the State funding of power production. It also allows the private sector to take part in the investment.

“This law should be accompanied by a modification in tariffs, which will eventually lead to an increase in customers’ electricity bill,” said Kabbani.

The private sector, he said, is willing to participate in this process because it is financially feasible and profitable.

The law will also pave the way for renewable energy projects. Albert Khoury, General Manager of Hawa Akkar, a wind farm project in the North, said: “This law reduces all legal hurdles and saves the time needed by the private sector to produce energy.” It will encourage partnership among private sector companies and will facilitate the financing of energy projects.