Green Grid, Infrastructure, Electricity and Renewables, Economic Update

Electricity Reform: A call for Transparent Pricing and Warning Against Government Management

13:04 | 31 March 2024LIMS output
0
Electricity

EDL’s recent endeavor to repair its pricing structure, promising improved electricity supply and bill collections in exchange for higher tariffs, has met yet another failure. While prices surged promptly, the anticipated enhancements in power supply and bills collections faltered, disproportionately burdening compliant bill payers while absolving non-paying consumers.

In response, LIMS has underscored a series of corrective actions imperative for aligning EDL’s pricing model with actual household consumption, steering away from a tax-like imposition on all households irrespective of their electricity usage. These recommendations encompass: (1) scrapping the fixed rehabilitation allowance, debunking its purported use for system refurbishment. (2) Transitioning from a fixed meter fee to a variable fee indexed to actual hours of electricity provision. (3) Pricing electricity in Lebanese pounds based on real-time market exchange rates during consumption, providing transparency on kilowatt-hour costs and averting billing surprises months or years later. (4) Abolishing value-added tax (VAT) on meter fees and associated consumption charges.

Meanwhile, the Council of Ministers stands at the cusp of a pivotal decision concerning the “Electricity of Zahle (EDZ)” concession, a private utility responsible for electricity generation and distribution in Zahle under a concession pact. LIMS clarified that authorities failed to renew the contract of EDZ post-concession expiry in 2018, coupled with the failure to reclaim assets and equipment as stipulated in the contract. The maneuver to issue a government decree to redress these lapses is viewed skeptically by LIMS, cautioning against potential cover-ups for further breaches. Notably, LIMS critiques the ineffectiveness of the handover committee within the ministry, highlighting systemic deficiencies and mistakes.

  • What’s Happening Behind The Scenes Between EDL And Zahle Electricity, March 18, 2024: Lebanon Debate, Article AR
  • Increasing Electricity Bills Solely On The Committed Citizen, March 11, 2024: VDL, Radio Interview AR
  • The Financial Electricity Crisis In Lebanon.. What Is The Fate Of The Iraqi Fuel Agreement? March 11, 2024: Huna lobnan, TV Interview AR
  • What Are The Obstacles Facing Public Institutions In Settling Electricity Bills? March 11, 2024: VDL,  Radio Interview AR
  • Recover Of Zahle Electricity Facilities Awaits The Final Decree, March 18, 2024: Nida Al Watan, Article AR
  • Electricity In Lebanon Warns Of Power Cuts In Case Of Non-Payment… Is There A Possibility Of Non-Implementation? March 20, 2024: VDL News, Radio Interview AR
  • Expatriates Ready To Finance Electricity Projects: Thinking Outside The Box, March 26, 2024: Al Modon, Article AR