Regulatory Reform
Lebanon will require regulatory overhaul in order to encourage the cleanest, most advanced, and efficient power system operation, to accelerate market growth and to unlock private investment. The country must remove all barriers hindering its energy transformation and reshaping its electric industry to rapidly scale up green energy adoption.
Authorities must therefore modernize a complex and outdated legal system, reduce burdensome permitting and approval processes and harmonize different policies, codes and regulations. Lebanon must also align its regulatory system to catalyze private investment and leverage innovation and technology advancement.
Government regulation must also support the development of clean energy markets and encourage new business models and public/private collaboration for electric utilities, clean energy products and energy conservation. New policies and incentives must therefore be encouraged to leverage technological innovation and address a diverse set of market barriers. Lebanon must also work to reduce development costs. It must also prioritize innovation and research to support the growth and deployment of clean technology solutions.
Reformed pricing structures must also reward investments that improve overall system efficiency (for example for managing loads to reduce peak demand), engage the private sector to invest in clean energy opportunities and place clean and distributed energy at the core of the new electricity model.
Procurement
In order to ensure strong participation and competition, all tenders in renewables energy must offer a transparent, simple, consistent and rapid tendering and award process.
As per the World Bank’s “Scaling Solar”program, tenders must integrate fully balanced and bankable project document templates that will eliminate negotiation and speed up financing.
Such a transparent and straightforward process will reduce time and transaction costs generated by individually negotiated contracts. Finally, in order to deliver rapid financial close and lower financing costs, competitive financing and insurance provided or backed by international institutions could be made available to approve winning bidders. Such ‘best practice’ approach aims to make privately funded solar and wind projects operational within two years at competitive tariffs.
For example, the delivery timeline from inception to delivery as per the”Scaling Solar” initiative should be two years. It is divided in 6-8 months for project/bid preparation and tender/award processes, 6 months for financial close and 10-12 months for construction & operation.
Source: Strategy& / AUB / LFRE
Other Solutions
smart grid
financing
energy mix
sun wind water