Karadeniz says it will cut supplies unless Beirut halts legal action to seize its power barges and sorts out arrears.
Turkey’s Karpowership, which provides electricity to Lebanon from two barges, said it was shutting down supplies over payment arrears and a legal threat to its vessels amid the country’s economic crisis.
The company, which supplies 370 megawatts (MW), or about one-quarter of Lebanon’s supply, told the government this week it would have to shut down in the absence of moves towards a settlement.
The shutdown threatens longer daily power cuts across the heavily indebted nation, which did not have enough capacity to meet demand even before Karpowership’s move which it announced on Friday.
Many people rely on private generators or struggle for several hours a day without power.
‘Very hard times’
In a statement, the company said it was shutting down supplies.
“For 18 months we have been exceedingly flexible with the state, continually supplying power without payment or a payment plan, because the country was already facing very hard times. However, no company can operate in an environment with such direct and undue risk,” Karpowership, a unit of Karadeniz, said.
A source familiar with the situation said the step was taken at about 8am (05:00 GMT) as the vessels’ fuel had been running down.
The source, speaking on condition of anonymity, said arrears exceeded $100m and added the government had not reached out for talks or to try and resolve a legal case, despite the firm’s repeated appeals meant to avert a shutdown.
Lebanon’s finance ministry said it had been notified by the Turkish firm and cited a legislator saying the country could face “total darkness” in case of a shut-off. It has made no public statement about any talks.
A Lebanese prosecutor threatened this month to seize the barges and fine the firm after Lebanese TV channel al-Jadeed reported corruption accusations over the power contract. The company denies the charges.
It said it had not been paid for 18 months, a period coinciding with the financial crunch, and added it sought a “reasonable solution” to maintain generation.
Each of its barges has a capacity of 202 MW against a contract to supply a total of 370 MW.
An industry source said Lebanon’s total capacity was about 2,200 MW, including the barges, but was only generating a total of 1,300 MW, including the Turkish supplies of 370 MW. Lebanon’s peak demand in 2020 was 3,500 MW, the source said.