ExecutiveMagazine - 4/16/2018 10:24:07 AM - GMT (+2 )
Earlier this spring, Lebanon signed its first-ever power purchase agreement (PPA) for wind energy with three separate consortiums that will build and operate wind farms in Akkar, in the north of the country. The energy ministry’s signing of the agreements represents Lebanon’s first PPA with the private sector in electricity generation as part of efforts to close an estimated 1 gigawatt gap between current electrical supply and demand in the country. Combined the wind farms will have a total generation capacity of 180 megawatts. Global wind-energy generation capacity reached 487 gigawatts by the end of 2016, according to the renewable energy policy network REN21, up 12 percent since 2015—but for Lebanon’s first venture into wind energy at this scale, many challenges and opportunities await.
One of the main challenges facing the wind energy industry around the world stems from the sheer size and dimensions of wind turbine components. As wind turbine components continue to grow in size and weight, transportation and logistical challenges complicate the components’ delivery to project sites. In Lebanon’s case, most of the components will be imported from Europe, arriving via sea to the Port of Tripoli. The challenge of transporting the long, wide blades—three are required for every wind turbine—is caused by the difficulty of maneuvering the massive trailer trucks carrying them around tight turns, along narrow roads, and beneath bridges and overpasses. The same applies to the large-diameter tower sections, of which three or four are required for every wind turbine, depending on the tower’s height and design. In addition to these geometrical burdens, road-weight limits also complicate the transportation process, due to the heavy weight of the nacelle, a unit that sits on top of the tower and contains the generator and gearbox, which can reach around 80 metric tons for turbines that generate between two to four megawatts.
For Lebanon’s first wind farms, the route between the Port of Tripoli and the project sites in Akkar represents a major challenge. Since the highway connecting the port to Akkar’s main coastal road is not fully built, trucks carrying turbine parts will have to use the narrower Beddawi road, which runs inside an industrial zone and includes tight turns and roadside obstructions. The same issues will reappear when the trucks leave the coastal road and start heading up mountain roads to the project sites in Akrum. To mitigate these transportation problems, the turbine components’ dimensions and weights need to be studied early in the project planning phase so that the roads can be surveyed ahead of time. This will provide advance notice for any necessary road widenings or modifications. The construction of the wind farms is scheduled to begin in April 2019, with the sites planning to begin operations by the end of 2020; if these roads are not upgraded in time, the deliveries risk grinding to a halt. Equally importantly, these upgrades represent much-needed infrastructure investments that will translate into increased local employment and reduced journey times. The cost of road congestion in Lebanon is estimated at $2 billion per year, or nearly 4 percent of GDP, according to BLOM Bank.
Lebanon’s Internal Security Forces will also play an important role in the project, escorting the delivery trucks and facilitating their maneuvering by blocking intersections where necessary and removing vehicles parked on the side of the roads.
These logistical constraints need to be identified and resolved early in the process to prevent bottlenecks in the delivery and installation processes. At the same time, these logistical challenges are opportunities for prospective Lebanese logistics companies, who will have a new market to compete over. Investing in trucks, specialized trailers and cranes, and trained personnel will likely pay off as Lebanon continues to develop its wind energy resources in Akkar and other windy regions.
Developing and operating wind farms can also turn low-income rural areas into prosperous ones through job creation and local economic development. This transformation will begin with the construction of the wind farms, which will require the hiring of hundreds of engineers, skilled tradesmen, and workers to take on the many preparations needed before the wind farms are commissioned and operational. The transformation will continue when the wind farms are up and running, as new permanent jobs will be created to support the operation and maintenance of the farms. It is advisable that a significant share of these jobs be filled by local workers, which will lead to increased social acceptance of the project. This is a huge opportunity for young men and women who are looking for jobs in rural Akkar and the surrounding regions.
Personnel working on site could stimulate the local economy with their spending on accommodation, groceries, and transportation. New businesses such as hotels, restaurants, supermarkets, and other retail outlets would be attracted to the area to serve the local workforce, spurring new economic activity. Moreover, wind farms will provide rural landowners and municipalities with a new income stream through land-lease payments for every wind turbine and access road located on public or private land. Overall, Akkar, which is in great need of local economic development, stands to benefit significantly when wind farms and the required workforce move in.
Power purchase agreements are only the beginning of a long process, which will face many challenges, from planning and construction to commissioning and operation. However, these opportunities will likely prove to outweigh the drawbacks, and will translate into much-needed economic activity in an impoverished area.