POWERING THE PEOPLE

Lebanon 2015 | ENERGY & ENVIRONMENT | INTERVIEW

TBY talks to HE Minister Arthur Nazarian, Minister of Energy and Water, on the balance between traditional and renewable energy sources, incorporating wind into the country's energy portfolio, and how the government supports private sector investment.

 HE Minister Arthur Nazarian
BIOGRAPHY
HE Minister Arthur Nazarian holds a BSc in Textile Engineering from Philadelphia University (USA). He was elected as a Deputy in 2009, and has been Minister of Energy and Water since 2014. In addition to his activities as a Minister and as a Deputy, he is active in the trade and industry sectors, owning several companies in the Gulf. He is also a Board member in Byblos Bank of Lebanon and Armenia, as well as the Member of the Armenian Catholicosate of Cicilia’s Central Political Committee. Previous governmental positions have included serving as Minister of Tourism and Environment.

What is your assessment of the current state of the Lebanese electricity system in terms of its sustainability?

Sustainable socio-economic development is a primary objective for the Lebanese government. Ensuring the security and efficiency of supply of energy is vital for the accomplishment of this objective. The fragile political and security status are putting enormous pressure on Lebanon's natural resources as well as on existing infrastructure. Subsidized electricity and water tariffs are imposing an additional burden on the national budget. The Policy Paper of the Electricity Sector includes ten strategic initiatives to develop the sector's infrastructure, balance supply and demand, and enhance the legal and administrative frameworks.

The Ministry of Energy and Water is investing all needed efforts to lead in transforming the energy sector towards a robust mix of traditional and renewable energy sources. Lebanon has committed itself to reach 12% of renewable energy by 2020. In addition, the policy emphasized the inclusion and the participation of the private sector in the electricity generation process.

For a small country, Lebanon has significant wind resources. How do you assess the opportunities for developing wind farms in Lebanon?

The national wind atlas of Lebanon shows that we have considerable wind energy resources, with a feasible potential of around 500 MW. The Ministry launched a national process to develop the first wind farm by the private sector back in 2012, and today we are finalizing this process.

How does the Lebanese Government support the private sector in preserving country's resources and developing green technologies?

The Ministry of Energy and Water is setting a clear path towards developing green energy technologies in the country. The Ministry is working hard to be a good example for the private sector to follow. The Ministry also invests considerable effort through the Lebanese Center for Energy Conservation (LCEC) to improve the quality of companies and services in the sector.

What are the main advantages of investing in Lebanon's energy sector and what steps are being taken to attract FDI?

The price, or tariff, at which the energy is being sold, is significantly below its cost. The solution would be to raise the tariff as needed to reach the balance between revenues and costs. The approach that the Ministry is using is to increase the tariff gradually as the hours of electricity supply are increased over time. The government needs to reach a situation that allows the tariff adjustment in order to reduce the burden of subsidies. The energy sector offers big opportunities for investment, especially since the banking sector in Lebanon is well developed. Lebanon is also aiming to open the door for private sector entities to invest in renewable energy sources like wind and solar.

What is your outlook for Lebanon's alternative energy future, as well as for the goal of the renewable energy policy to generate 12% of power from renewable energy sources by 2020?

The Ministry of Energy and Water is keen to develop renewable energy sources as well as energy efficiency measures. Today, the Ministry through the team of the Lebanese Center for Energy Conservation is evaluating the 2011-15 plan and is now developing the 2016-20 plan towards achieving our national target of 12% renewable energy by 2020. The set targets are challenging, but I am optimistic about the path the country is taking in energy efficiency and renewable energy.

Looking to 2016, what are your main goals as the Minister of Energy and Water?

The concerns and goals of any Minister of Energy and Water is to ensure the smooth continuation of projects in the Energy and Water sectors since these projects are long-term government investments. This is particularly important for the energy sector since it is a vital one that can have strategic, economic, and environmental impacts.