Syrian government encourages renewable energy investments to ease electricity crisis
Enab Baladi – Zeinab Masri
Amid increased complaints from Syrians in regime-held areas about repeated power outages and extended rationing hours up to 23 hours in some areas, the head of the regime, Bashar al-Assad, issued Law No. 32 of 2021 amending Article 28 of Law No. 32 of 2010 on the Syrian electric sector. The new amendment allows the Syrian government to purchase electricity produced from renewable energy projects in the private sector.
The amendment raised Syrians’ fears in regime-controlled areas that electricity bought from renewable energy projects would be sold at a high cost to them in a similar way to the Syrian Ministry of Electricity’s high pricing of the subscription cost to a power line exempted from rationing, which amounted to 300 Syrian pounds per kilowatt.
Syrian officials said that the new law would not affect electricity prices set by the government and pointed out that the law comes as a joint project between the public and private sectors, denying any direct impact on citizens.
A win-win deal
The law on the amendments to Law No. 32 of 2010 allows the purchase of electricity produced from renewable energy projects that can be connected to the government’s transportation or distribution networks as long as the technical capacities exist for it and according to the rules, conditions, and surveys of the General Company for the Transmission and Distribution of Electricity in Syria.
The law allows the Ministry of Electricity to conduct power-purchasing contracts with alternative energy companies under specific prices approved by the Syrian Prime Ministry.
Syria’s Minister of Electricity Ghassan al-Zamil stated to the local pro-government al-Watan newspaper that the new law would encourage investment in renewable energy projects and the distribution of electricity produced by them through the Ministry’s power transmission and distribution lines. This way, the private sector can contribute alongside the public sector in meeting the growing demand for electricity.
Meanwhile the Director of the National Energy Research Centre (NERC), Younes Ali, told the local radio station Sham FM on 28 November that the new modification to the electricity law is not a trend towards the privatization of electricity, as it is a kind of partnership between the public and private sectors, aimed at committing the Ministry of Electricity to purchase the surplus production of such projects.
Syrian researcher and Ph.D. holder in Economics and the Director of the Operations and Policy Center (OPC), Karam Shaar, told Enab Baladi that the new law is “good” in principle for the regime government and private sector companies, as it would serve both parties.
Shaar explained that renewable energy in Syria is mainly solar and not hydropower or produced by wind, especially that hydropower is almost non-existent due to the substantial decline in water levels over the last decades and the regime government’s loss of control over water turbines.
Consequently, solar energy companies will have surplus electricity during the day as long as they harness light and heat from the sun.
Shaar added that companies generating electricity with solar energy would have to store their excess production in batteries, which would be very expensive and financially draining.
Therefore, it is the optimal option for renewable energy companies to distribute their surplus electric production through the government’s electricity network, especially since the Syrian government is struggling to provide power to its regions.
Shaar added that the regime government cannot invest in clean energy projects for such investments are extremely expensive, not only to Syria but all countries. In addition, the use of fossil fuel is believed to generate more returns than alternative energy, and that is why governments are hesitant to shift towards alternative energy resources and are pressured by their people and international policies to this trend.
Concerns over rising electricity charges
In early November, the Syrian Ministry of Electricity increased electricity prices up to four-fold in most consumption classes, with the increase ranging between 100 and 800 percent.
Even though the Minister of Electricity, al-Zamil, said before that electricity prices would not be raised, the al-Watan newspaper reported on 25 October the government’s intention to raise electricity prices to “encourage” subscribers to rely on renewable energy.
According to al-Watan, the rise in electricity prices aims to cover part of the government’s power consumption, lower financial losses of state power companies, and provide cash flow for the work of the electricity sector.
Al-Zamil asserted that the purchase of electricity produced by renewable energy facilities would not affect the Ministry’s electricity rates and that the Syrian Prime Ministry would determine the purchase prices from such facilities based on a study and proposals implemented by the Ministry of Electricity.
Previously, the Director-General of the General Company for the Transmission and Distribution of Electricity, Fawaz al-Zaher, announced on Sham FM that the government has made available a subscription service to power lines exempted from rationing at the cost of 300 Syrian pounds per kilowatt.
The Director of Planning and International Cooperation of the Ministry of Electricity, Adham Ballan, said that the electricity price increase was “to preserve the electricity sector,” with annual costs of up to 5.3 trillion Syrian pounds, while its revenues under the previous rate were only 300 billion Syrian pounds.
Researcher Shaar said that the Syrian government is exaggerating electricity subsidies cost, and its officials are giving false information on power lines exempted from rationing.
Shaar added that the government’s stated numbers are not logical, pointing out that Syria’s entire budget for the current year was reported at 8.5 trillion Syrian pounds, so how could the annual cost of electricity exceed 5 trillion Syrian pounds.
According to Shaar, the Syrian government’s main problem is not the production of electricity as much as the lack of power sources needed for generating electricity, for it cannot afford to buy natural gas or fuel to operate power plants. As a result, the government is encouraging the private sector to invest in renewable energy and link their production with the public power network to mitigate the electricity sector crisis.
Lately, the regime’s government started paying clear interest in alternative energy projects and promoted them as the solution to the problem of power outages, despite the high costs of such projects, which it cannot cover.
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