Lebanon's Corrupt Power System Fuels Generator Crisis, Exorbitant Bills

Lebanon's electricity supply is now heavily reliant on diesel-powered generators, providing approximately half of the nation's power. This dependence, according to data for an upcoming report, exposes the crisis-stricken country to significant financial, environmental, and operational risks. This alarming statistic is the result of a deep-rooted crisis that has been developing for decades.

Interviews with officials, government statistics, studies, and testimonies gathered by The National reveal how a largely unregulated industry has enriched high-ranking officials and local generator owners alike. Since the end of the civil war in 1990, the electricity sector has been widely considered one of the most corrupt elements within Lebanon’s sectarian governmental system. Those who profit from the ongoing dysfunction have reportedly thwarted efforts to reform the sector, thereby preserving a system that allows them to continue capitalizing on its failures.

Figures being compiled by the Lebanese Centre for Energy Conservation (LCEC) for their forthcoming report indicate that private generators supplied 50 percent of Lebanon’s electricity at the start of 2026. In contrast, Electricite du Liban (EDL), the state-owned utility, provided only 31 percent. The LCEC, a national agency affiliated with the Energy Ministry, suggests that EDL's share has likely diminished further over the summer months.

Meanwhile, the Lebanese populace bears the financial burden. The nation's reliance on costly diesel imports for generator operation has caused energy bills to skyrocket in recent months, exacerbated by rising global oil prices due to the Iran war. This situation further strains households and businesses already struggling from years of economic crisis. Among a dozen individuals interviewed by The National, the median generator bill in August was $310. The dependence on generators escalated dramatically after a severe economic crisis began in 2019, dealing a final blow to the already dilapidated electricity sector.

As the bankrupt state struggled to secure fuel for its power plants, EDL's electricity production plummeted by nearly 80 percent between 2018 and 2023, from 15.4 TWh to 3.37 TWh, according to a 2025 report by the LCEC. During the same period, diesel-powered generators' contribution to Lebanon's electricity supply more than doubled, rising from 23.1 percent to 51.5 percent. Beirut's approximately 9,300 generators have been in near-constant operation, emitting polluting exhaust and shrouding the capital in a yellowish smog, while supplying power to those who can afford it.

“We can’t go on like this,” stated Ayman, the manager of a shawarma restaurant in Beirut’s lively Hamra neighborhood, who provided only his first name. With state electricity available for only a few hours daily and at unpredictable times, the restaurant relies almost entirely on a private generator. Ayman reported that the small restaurant's electricity bill for August alone reached nearly $20,000. “We’re losing money,” he lamented. The typically busy summer season, which he had hoped would bolster the restaurant's finances, proved disappointing. The resumption of the war between Hezbollah and Israel in March led to a significant absence of tourists and even Lebanese expatriates.

“If nothing is done, we will have to close. And not just us, everyone else too,” Ayman warned. While generator bills vary significantly by area due to limited state oversight, data from New Energy Consult and The National's interviews with residents show that monthly bills frequently exceed $300, which is roughly equivalent to the entire monthly minimum wage of 28 million Lebanese pounds. For comparison, the average household electricity bill in the UK is approximately $95 per month for a medium-sized household of two to three people. In one Beirut neighborhood, a 25-amp generator subscription cost as much as $750 in August, according to New Energy Consult, a consultancy founded by Lebanese energy expert Jessica Obeid. Ms. Obeid noted that some generator operators have exploited the global surge in oil prices to increase their profit margins.

“The problem is that nobody has provided state electricity over the past three decades, and nobody has implemented any serious reforms,” she explained. “Generators eventually just reflect the failure of the state, the failure of policies and the failure of institutions. So it’s time for state institutions to stand up and do what they’re supposed to be doing: provide electricity.”

'Mass Bribe System'

Citizens strolling along Hamra's main street express their frustration with soaring energy costs. “It’s insane,” remarked Karim Agha, 33, who recently returned from Dubai. He mentioned that his parents' electricity bill reached $600 in August, triple what he used to pay in the Emirates. “I’m scared to look at the bill,” said Talal Fayed, a 67-year-old driver who paid a $300 generator bill in August. When asked about his expectations from the Lebanese state, he sighed and replied with a faint smile, “What state?”

The substantial sums flowing monthly from consumers to the private generator industry raise a critical question: why have Lebanese authorities failed to implement energy reforms that would redirect this money to the state? Energy experts point to vested interests and a lack of political will as factors preventing a transition to cheaper, cleaner energy, thereby locking the country into a dangerous dependence on generators. The diesel generator industry is highly lucrative; Ali Ahmad, a World Bank expert, estimated its value at approximately $3 billion in 2020, with about $1 billion allocated to the generator market and $2 billion to diesel importers. Opposition MP Paula Yacoubian stated that the generator “cartel” benefits politically connected individuals and companies that have little incentive to relinquish their profitable enterprise. She argued that generator owners are integrated into Lebanon’s clientelism networks, capable of offering advantages like forgiving unpaid bills in exchange for political backing. “It's a mass bribe system,” she told The National.

A systemic deficiency in investment and the mismanagement of public funds have left Lebanon’s energy sector in disarray. According to a 2024 EDL report, approximately 40 percent of electricity entering EDL's network is lost due to technical distribution issues and commercial losses such as theft and illegal connections. With its weakened financial sector and unstable security situation, Lebanon has faced challenges in attracting foreign capital since 2019. However, the lack of investment in the energy sector is not a recent phenomenon; the state has not constructed a major power plant in decades. Its most recent large plants, Deir Ammar and Zahrani, were built in the late 1990s. “With $1 billion, you can build a 1,000MW power plant. It's nothing. People are already paying for it with their generator bills,” Ms. Yacoubian asserted. EDL possesses roughly 3,000MW of nominal installed capacity, yet in 2023, it supplied electricity equivalent to only 13 percent of its theoretical maximum output. The country requires approximately 3,000MW of electricity to meet daily demand. Only two of Lebanon’s seven thermal power plants are operational, as the cash-strapped state cannot procure sufficient fuel, and poorly maintained infrastructure limits production. A 1,000MW plant operating at 80 percent capacity could generate about 7 TWh annually, more than double EDL’s total electricity supply in 2023, which was approximately 3.4 TWh, according to the LCEC. “This is not a technical problem,” Ms. Yacoubian emphasized. For over two decades, political disputes have stalled all major investment projects in Lebanon. “Power plants are routinely built everywhere else in the world. Anyone, my aunt Salma included, could bring electricity,” she said. “But there are no politically affiliated politicians who were able to do it in Lebanon.”

Powerful Oligopoly

Energy Minister Joseph Saddi acknowledged that investing in electricity generation is the solution to the country’s dependence on generators. “We are now engaging with the private sector,” he informed The National. The Energy Ministry has tasked the International Finance Corporation (IFC), the private-sector arm of the World Bank, with securing the necessary private-sector investment. “There are investors who are interested, but they require a certain number of financial guarantees. So what we are focusing on now is how we can provide those guarantees,” Mr. Saddi stated. The IFC's role notably involves acting as the lead transaction adviser for a public-private partnership concerning a new 825MW combined-cycle gas turbine plant, a project that has been under consideration for years. Concurrently, the World Bank has approved a $250 million loan to EDL for infrastructure upgrades.

Experts suggest that diesel importers, even more so than generator owners, exert considerable influence over policy decisions due to their close ties with politicians. A 2022 investigation by Triangle, a Beirut-based research center, uncovered direct links between several of Lebanon’s 13 licensed fuel-importing companies and current or former politicians. Marc Ayoub, an energy expert who has studied the sector for years, describes Lebanon’s diesel importers as forming an oligopoly with extensive political connections. Instead of competing, he noted, they collaborate to maximize their profits, sharing the costs of vessels and associated shipping fees before dividing the imported quantities among themselves. Private generators are filling the gaps in Lebanon's decrepit power grid. Getty images Show caption: Private generators are filling the gaps in Lebanon's decrepi… They then sell the diesel, locally known as mazout, at a price set by the Ministry of Energy, currently around $30 for 20 liters, which Mr. Ayoub indicated allows them to achieve comfortable profit margins. The tariff “contains a lot of hidden profits for importers, in addition to margins for distributors, lorry owners, petrol stations and everyone else involved,” he stated. The Energy Ministry could reduce the additional premiums it pays to importers, which he believes could lower diesel tariffs by at least 15 percent. However, he observed, the state continues to “protect the interests of these private players.”

There are also issues on the generator side. While the Energy Ministry sets generator tariffs—which have increased by almost 60 percent in six months—many operators do not adhere to them or even install the mandatory electricity meters. Instead, they charge residents a fixed monthly rate based on their subscription's amperage, which dictates the number of appliances consumers can operate simultaneously. Despite occasional government crackdowns on overcharging customers and failing to install electricity meters, generator operators have largely been able to set prices at their discretion.

One positive outcome of the near-collapse of state electricity supply is the surge in popularity of solar panels, which accounted for 19 percent of electricity production in 2026, up from just 0.4 percent in 2018, according to the LCEC. None of the individuals interviewed by The National reported installing solar panels. Mr. Fayed, the taxi driver, suggested this would be the only viable path to overcome dependence on both generator owners and the state, neither of whom he trusts. However, like many Lebanese living paycheck to paycheck, he lacks the upfront capital to install solar panels. “Too expensive,” he sighed.

Given that Lebanon is experiencing one of the fastest-growing cancer rates globally, experts have urged the country to transition to cleaner energy sources. A 2024 study led by scientists from the American University of Beirut found that the concentration of carcinogenic pollutants from diesel generators in the capital's air has doubled since 2017, increasing the risk of developing cancer by 50 percent. “It’s suffocating, it’s killing us, it’s loud, it’s expensive … And we know that it is all due to corruption,” Ms. Yacoubian stated. “I'm telling the Lebanese people to wake up – wake up, and smell the mazout.”