Lebanon’s Electricity Regulatory Authority marks a historic step toward reforming the power sector, ending monopolies and enabling private-sector investment.
Lebanon’s Regulatory Authority advances electricity reform
Lebanon’s Regulatory Authority advances electricity reform
By Patricia Jallad | July 12, 2026
Reading time: 5 min
After 23 years of waiting, and amid the new government’s determination to find a solution to the electricity crisis, which has cost the state an estimated $40 billion in losses, and to regulate electricity generation, distribution, and transmission in partnership with the private sector through the issuance of licenses based on technical and professional standards rather than political considerations, the Council of Ministers appointed the National Electricity Sector Regulatory Authority last September, pursuant to Law No. 462/2002, the legislation establishing the authority.
Since then, the Authority has begun operating "with the bare minimum of resources," relying on a team of highly qualified experts in all aspects of the energy sector; technical, legal, and financial. Its members are Daniel Juhia, Sourina Murtada, Ziad Rahmeh, and Christina Abi Haidar.
During an extended meeting with a group of journalists, the members of Lebanon's Electricity Sector Regulatory Authority answered every question posed regarding their work to date and the studies currently under preparation. It became evident that the plans being developed for the sector go far beyond technical oversight and the issuance of licenses, amounting instead to a comprehensive restructuring of Lebanon's electricity sector; from petroleum to renewable energy sources, including solar, wind, and hydropower. The discussion was not theoretical but direct and candid, laying out a roadmap to address one of the country's most persistent challenges.
The members explained that the Authority is not responsible for operating or producing electricity. Rather, its role is to regulate, supervise, and ensure proper implementation, free from political interference. According to the plan currently being finalized by the Authority, the long-standing monopoly of Électricité du Liban (EDL), established under the 1964 decree creating the state utility, will be dismantled by restructuring the sector and transforming EDL into a corporate entity. This would allow private-sector participation alongside the public sector.
Separate companies would be established for electricity generation, distribution, and transmission, each required to obtain licenses from the Authority. Ownership would be divided, with up to 40% allocated to the private sector, while 60% would remain under public ownership.
Corporatizing the public sector
The issuance of licenses will pave the way for private companies to enter the electricity market, but under strict conditions designed to ensure fair competition and prevent monopolistic practices.
"There will no longer be any arbitrary decision-making," the members said, referring to the transparent mechanism that will govern the review and approval of licensing applications.
Electricity tariffs remain the most sensitive issue. The Authority's members acknowledged that any changes to tariffs directly affect citizens' daily lives. They stressed that the pricing structure will be competitive and is currently being prepared in cooperation with the World Bank.
Regarding oversight, the members expressed confidence that all companies operating in the sector will be subject to rigorous monitoring, both in terms of the quality and reliability of electricity supply and compliance with environmental standards. The sector, they said, will no longer be characterized by disorder or political patronage. The Authority will enjoy full independence and possess powers extending to the suspension or revocation of operating licenses where necessary.
The Authority also emphasized its broader role in shaping the future of the electricity sector. In addition to regulation, it is working on a long-term strategic vision that includes expanding renewable energy and modernizing the national electricity grid.
"We are not simply solving today's problems; we are laying the foundations for a sustainable electricity sector," one member summarized.
Who finances the regulatory authority?
The Electricity Sector Regulatory Authority, which enjoys both financial and administrative independence, is not funded through the conventional state treasury model. Instead, Law No. 462/2002 established a dedicated financial framework designed to ensure the Authority's independence and the sustainability of its operations.
Responding to a question from Nidaa Al Watan regarding how the Authority is financed, particularly given that it will recruit staff and establish a judicial enforcement unit with powers to conduct field inspections, member Ziad Rahmeh explained that the government has currently allocated $2.3 million through the state budget to support the Authority during its first 2 years. Of this amount, 35% is allocated to operational expenses, while 65% covers salaries and wages. After this transitional period, the Authority is expected to become fully self-financing.
Under Article 15 of Law No. 462/2002, the Authority's revenues are derived from several principal sources. These include fees collected for license and permit applications, in addition to annual charges paid by license holders in return for being subject to the Authority's regulatory oversight and supervision. This reflects the Authority's role as a regulatory body that finances part of its activities through the sector it oversees.
The Authority is also entitled to collect a percentage surcharge on electricity consumption bills, provided that it does not exceed 1% of the bill's value. The exact percentage will be determined by a decree issued by the Council of Ministers based on the Authority's financial requirements and approved budget. This revenue stream is considered particularly important because it provides a stable source of funding directly linked to electricity consumption levels in the market.
The law also establishes strict financial controls. Budget surpluses or deficits may be carried forward to subsequent fiscal years within specified limits. Any surplus exceeding the prescribed thresholds must be transferred to the state treasury, thereby maintaining a balance between the Authority's financial independence and its accountability within the framework of public finances.
Overall, the Authority's financial model has been designed to enable it to finance its own operations, reinforcing its status as an independent regulatory institution rather than simply another government department. Meanwhile, the government's general electricity policy paper has already been finalized and will soon be announced by the Ministry of Energy, while the feasibility studies currently being conducted by the Authority in cooperation with Électricité de France (EDF) have reached their final stages.
Amid ongoing political and economic challenges, hopes remain that the Authority will evolve from a legal provision on paper into an effective institution capable of restoring confidence in a sector that has been devastated by years of decline.
