Stalled communications between WB, MoE regarding $250 million energy import project

Since last summer, written correspondence between the World Bank and the Ministry of Energy regarding the financing of gas and electricity imports from Egypt and Jordan at a cost of $250 million per year has come to a halt.

Sources within the Ministry of Energy stated that the project is nearly frozen after the World Bank insisted on the full implementation of financial auditing conditions in Lebanon's electricity sector. This includes appointing a regulatory body, ensuring its operation, and verifying financial sustainability in Lebanon's electricity sector without incurring losses.

The World Bank reportedly informed the Ministry of Energy, as well as American and French parties interested in the matter, of its stance. The message questioned why, if these parties are pressuring the World Bank to fund the project now, they are not providing the funding themselves.

Despite this atmosphere, the Ministry of Energy continues to work on meeting the World Bank's conditions. In regard to financial auditing in Lebanon's electricity sector, a company was recently approved, receiving a classification letter from the Ministry of Finance. The company is expected to begin work at a cost of $150,000, which will be paid by Lebanon's electricity company from its own funds.

Regarding the regulatory body, the extended deadline for submitting applications is set to expire by the end of this month. Approximately 40 people have applied, a relatively small number compared to the 300 individuals who applied for membership on the electricity board. The question now is whether the Ministry of Energy will be satisfied with the 40 applicants or extend the nomination deadline again.

On the subject of financial sustainability, sources within the Ministry of Energy confirmed that the ongoing emergency electricity plan contributes to achieving financial balance in the electricity sector, provided that the necessary success factors are in place. These factors are related to the Central Bank of Lebanon and the political authority, which are both currently suffering from tension and disintegration. If the situation remains unchanged, the import issue could become a matter of addressing unnecessary requirements.