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Overall sector strategy

The theory of change for the Energy sector towards the sector’s overall objectives are as follows:

If:

• The Energy sector increases the capacity of electricity generation through the installation of renewable energy systems (Outcome 1) or decreases the demand for electricity through the provision of energy efficient products (Outcome 2); and

• Support of the rehabilitation or reinforcement of the electricity network is realized (Outcome 3); and

• Enhances the capacity of implementing partners, such as the Ministry of Electricity and Water and other actors occurs (Outcome 4);

Then: The sector can partially and locally reduce the supply/demand gap exacerbated by the displaced population and increase the network’s capacity to deliver non-fluctuated/intermittent electricity access to the most vulnerable in an environmentally friendly manner, reducing the reliance on diesel generators and air pollution caused by it.
The overarching objective of the Energy sector in Lebanon is to improve access to electricity at agreed minimum standards to households affected by the Syria crisis, and across sectors providing vital services.

It aspires to provide electrical services to Lebanese host communities and persons displaced from Syria equitably, with consideration to its potential negative impact on the environment and limiting the financial impact on the Lebanese Government and consumers.

The overall objective of the Energy sector is: “By the end of 2020, all vulnerable populations in Lebanon will have improved and equitable, sustainable access to electricity services.” By enhancing electricity services and capacity at the national and local level in a sustainable manner, the Energy sector contributes to the LCRPs third objective of supporting service provision through national systems, and the fourth objective of reinforcing Lebanons economic, social, and environmental stability.

Before the outbreak of the Syria crisis, the Ministry of Energy and Water had been improving Lebanon’s electricity infrastructure, guided by the Policy Paper for the Electricity Sector (Ministry of Energy and Water, 2010), which was updated in 2019i , and the other national action plans for renewable energyii and energy efficiencyiii. The strategy for the Energy sector is built on these national strategies, while also considering various vulnerability assessments to understand and identify where the most urgent and critical needs exist.

While the Ministry of Energy and Water continues to implement its Policy Paper for the Energy Sector, a number of short and medium-term projects will be selected and accelerated in order to directly target the impact of the Syria crisis on the sector. The proposed interventions can be summarized as follows:

• Capital investment in decentralized energy generation capacity (Outcome 1), energy efficiency measures (Outcome 2) and associated transmission and distribution networks (Outcome 3) to partially meet the additional demand created by the displaced Syrians while also supporting vulnerable communities and public institutions by improving access, availability and affordability of electricity, and;

• Supporting the implementation of the government’s development plans for the Energy sector through increased institutional capacity and technical assistance (Outcome 4).

All vital services in Lebanon depend on the provision of electricity. Therefore, by improving the overstretched condition of the Energy sector, the sector’s interventions can also contribute to achieving outcomes identified by the other sectors. The identified cross-sector contributions are as follows:
Education (out-of-school children): To host persons displaced from Syria, many public schools are now providing second shifts, which strain the operational capacity of the schools. The implementation of energy efficiency and renewable energy measures are a costeffective way to reduce the electricity bills at schools.
The Education sector and the Energy sector, under the guidance of MEHE will implement Renewable Energy projects mainly distribution of Solar PV systems and installation of energy efficient (LED Lighting) projects in public schools. The installation of solar PV in schools can generate monetary savings throughout its lifespan (c.a. 20 years) and the financial savings from reducing electricity bills can be re-directed to core education activities such as school enrolment.

Local economic development: Even though the proposed activities in the Energy sector’s response plan essentially target the public sector, the technical capacity in this sector, together with the increasing private investment in renewable energy and energy efficiency (including green building) projects stimulated by the green finance mechanisms (such as the EBRD GEFF and the EU/EIB/AFD LEEREFF), could provide cross-cutting opportunities for job creation. In fact, a UNDP study has shown that investment in solar PV systems creates various local “direct” and “indirect” jobs in Lebanoniv. Direct jobs include construction work, the design of the solar PV system, and other business activities such as financing, admission, legal services, consultation and planning. In addition, along the solar PV value chain, the demand for wiring, cabling, legal services etc. creates indirect jobs in the respective economic sectors. It is estimated that each US$1 million investment for 1 MW of solar PV installation creates at least 11 direct jobs (Full-Time Employment equivalent, FTE) and 20-25 indirect ones, amounting to 30-45 FTE jobs along the value chain. This indicates that further acceleration of investment in the installation of solar PV will expand job-demand/requirements in the sector.