Renewed contract for electricity service providers

The Cabinet renewed the contract with the two Distribution Service Providers (DSP), BUS, part of the Butec Group, and KVA, of Arabian Construction Company (ACC), until 2021. The Cabinet will undergo negotiations with NEUC, part of Debbas Group, until they find solutions for the problems they are facing.

Kamal Mhayar, Advisor at the Ministry of Energy and Water, said the contract was renewed for three months only with NEUC, which is facing financial problems. “If NEUC didn’t find the solution, a new tender will be launched to handle the region they were handling to another service provider,” he said. NEUC was in charge of the entire region from the Southern suburbs to the South.

The value of the renewed contract per company remains unchanged at between $260 million and $280 million. The contract noted that any decrease in the prices of raw materials, which are mainly metal, copper, and aluminum should be taken into consideration.

The firms are required to install smart meters during the next four years. The DSPs are expected to install 1.1 million meters, valued at $350 million.

“The first year will be for testing and certification, and during the second and third year, one and ten percent of smart meters will be installed respectively,” a source close to the deal said. By the end of the fourth year, all meters would have been installed. The smart meter reduces technical and non-technical (theft) losses of electricity.

KVA has a fulltime staff of 700, covering Beirut and Bekaa. BUS has 850 staff covering the entire region north of Beirut. NUEC has 1,200 staff.