Libya – A Potential Powerhouse for Clean Energy

August 16, 2021

Fossil fuels have given many countries opportunities to provide for their people. Oil revenues led these countries to depend heavily on this resource for both income and energy. Such dependence on the oil sector can be problematic. Libya is one of the major oil- and gas-producing countries in the Middle East and North Africa (MENA) region and its resources have provided Libya a considerable degree of power and influence. Electricity shortages are rampant in war-torn Libya, however, and, as emissions increase, investment in Libya’s renewable energy potential offers a much-needed opportunity for the country to escape from fossil fuel dependency. The solar energy sector has the potential to make Libya a regional network node, leading in clean energy production while connecting the North African region. Cooperation between diverse actors can also lead to political stability.

The Struggle to Electrify Libya

Libya is a fully electrified country, and, due to the communist economic system adopted in 1969, the country subsidizes electricity.[1] Before 2011, electrical energy supply and provision performed reasonably well in Libya, with installed generation capacity surpassing the required load by an adequate margin.[2] Since 2011, however, Libya has suffered severe electricity shortages and power cuts due to damage and destruction from the civil war, which began in 2014 with the formation of two rival administrations: one in the western capital Tripoli, and another in the east. This led to the sabotage and vandalism of power plants and transmission network assets.[3] Due to political and social unrest, oil fields became a target for blockades. From 2013 to 2016, Libya experienced a severe recession, with GDP falling by 12.7 percent on average over this period. This slump was mostly driven by the blockade of several oil facilities, which led to limited oil production.[4]

As a consequence of the conflict, crude oil production fell from an average of 1.77 million barrels per day in 2010 to 22,000 barrels per day in July 2011, although output was rapidly restored in the last quarter of 2011 to half the pre-conflict level.[5] Non-hydrocarbon economic activities were adversely affected by the war due to the destruction of infrastructure and production facilities, disruptions to banking activity, limited access to foreign exchange, and the departure of expatriate workers.[6] Consequently, with an estimated 50 percent contraction in non-hydrocarbon output, Libya’s total real GDP in 2011 was 60 percent lower than in 2010.[7] 

The subsequent lack of liquidity and foreign investment in Libya worsened, complicating the situation. Many projects, including those in the construction and energy industries, were suspended. With actual electricity generation below load demand, grid system operators had no option but to implement rolling blackouts to avoid system-wide collapse.[8] This situation still prevails in Libya today and urgent action is needed.

Currently, oil and natural gas account for most of the electricity generated in Libya. The entire energy sector in Libya is dependent on oil, natural gas, and biofuel and waste.[9] Existing national policies have provided major incentives for companies to generate energy from primary sources like oil and natural gas.[10] Oil and gas, however, are no longer  adequate or secure energy sources for Libya, because of the current fluctuation of the economic situation, the increasing impact of climate change, and the unsustainability of these sources in the long term given the struggles mentioned above.

Libya’s wartime and post-war energy shortages impacted not only Libya’s economy, but also people’s health and the environment due to air pollution. According to World Health Organization guidelines, Libya’s annual mean concentration of PM2.5 (particulate matter with a diameter of 2.5 mm or less ) is 54 µg/m3, which far exceeds the recommended maximum of 10 µg/m3.

The Potential to Invest in Renewable Energy in Libya

Apart from oil and gas, Libya has several other valuable resources, including large areas of unused land and long hours of sunlight. One medium- to long-term solution for Libya’s electricity crisis would be to invest heavily in solar energy, taking advantage of these resources.

Unfortunately, renewable energy is still viewed with suspicion in Libya. The country’s prolonged conflict and weak public administration have negatively impacted the relationship between central and subnational governments.[11] In addition, key organizational and managerial functions, such as human resources, financial management, procurement, and communications are unclear or absent across much of the government.[12] Due to these factors, as well as an overall lack of awareness and experience with renewable energy technology, renewables remain unpopular.

Increased investment in solar energy could not only solve the electricity crisis for Libya’s (relatively) small population; it could also make the country an important renewable energy provider and network node in the region. This means that Libya would be able to not only produce solar energy for itself, but also export this energy to neighboring countries.

Fostering Cooperation

Although Tunisia, Libya’s neighbor to the west, has abundant renewable energy resources (wind, solar, biomass, and hydropower), the sector is still underdeveloped. In the current energy mix, wind and solar energy represent less than 1 percent of Tunisia’s energy production.[13] This could be an incentive for Tunisia and Libya to cooperate and build a regional network for renewable energy. Given Libya’s current challenging situation, government and regional support is certainly welcome, but this alone is not enough.

Cooperation is key. Cities; local and international non-governmental organizations (NGOs); international institutions willing to provide funding; as well as a network of national, regional, and international experts should be involved. The aim should be to bring solar energy to life in Libya and create job opportunities benefiting both citizens and corporations.

Local authorities and NGOs are important partners in Libya’s transition toward solar energy because they possess the local knowledge and access needed to successfully implement renewable energy projects. This is crucial for the private sector, which can apply its operational and technological know-how to implement projects. National and international micro-financing tools for small-scale renewable energy projects should also be developed to allow adequate adaptation for vulnerable local populations.[14]

It can be done. Morocco, for example, has adopted a renewable energy development model based on public-private partnerships (PPPs) in which the private sector brings its know-how to complete projects and make them operational.[15] This opens, and allows greater access to, the renewable energy market. Libya should follow a similar model to the PPP experience in Morocco, as this has enabled small-scale renewable energy generation projects to enter the market. This would allow Libya to take a bottom-up and community-based approach to its renewable energy sector.

The public sector must provide a conducive regulatory framework by adopting policies that strengthen the coordination of national regulations with technical rules for operating power systems. In addition, for this transition to be successful, private banks must be able to provide loans, as there is currently a lack of financial support for small-scale renewable energy projects in Libya.

Beyond the immediate crisis of power shortages, the demand for electricity in Libya will increase in the long term. Continuing to rely on oil is not an option as resources are further depleted and emissions increase. Instead, the national government, local authorities, NGOs, and private actors must cooperatively invest in solar energy in Libya.

References

Photo by American Public Power Association on Unsplash

1  Ashraf Khalil and Ali Asheibi, “The Chances and Challenges for Renewable Energy in Libya” (paper presented at The 4th International Conference on Renewable Energy Research and Applications, Palermo, Italy, 2015), https://www.researchgate.net/publication/283722527_The_Chances_and_Challenges_for_Renewable_Energy_in_Libya.

2 Mohamed Almaktara, Abdelnaser Elbrekib, & Mohamed Shaaban, “Revitalizing operational reliability of the electrical energy system in Libya: Feasibility analysis of solar generation in local communities,” Journal of Cleaner Production 279 (2021), doi:10.1016/j.jclepro.2020.123647.

3 Ibid.

4  World Bank Group, “Libya Economic Monitor,” Issue 1 (July 2020), https://documents1.worldbank.org/curated/en/121101597261547774/pdf/Libya-Economic-Monitor-July-2020.pdf.

5 Ralph Chami, Ahmed I. Al-Darwish, Serhan Cevik, Joshua Charap, Susan Mary George, Borja Gracia, Simon Gray and Sailendra Pattanayak, “Libya Beyond the Revolution: Challenges and Opportunities,’’ International Monetary Fund Middle East and Central Asia Department (2012), https://ssrn.com/abstract=3064002.

6 Ibid.

7 Khulod Ali El sahati, “Determinants of Electricity Demand in Libya: An Empirical Study for the Period 1980-2010” (PhD diss., Liverpool John Moores University, 2014), http://researchonline.ljmu.ac.uk/id/eprint/4561/1/157953_khulod%20El%20sahati%20Thesis.pdf.

8 Ibid.

9 “Libya,” International Energy Agency, accessed August 9, 2021, https://www.iea.org/countries/Libya.

10 Omar Ahmed Mohamed and Syed Hasan Masood, “A brief overview of solar and wind energy in Libya: Current trends and the future development.”  IOP Conference Series: Materials Science and Engineering 277 (2018), doi:10.1088/1757-899X/377/1/012136.

11 World Bank, International Bank for Reconstruction and Development and International Finance Corporation and Multilateral Investment Guarantee Agency Country Engagement Note for the State of Libya for the Period 2019-2021, report no. 123985-LY (2019), https://documents1.worldbank.org/curated/zh/750661550977483586/pdf/Libya-CEN-to-Board-final-01252019-636865562772741763.pdf.

12 Ibid.

13 African Development Bank, The Renewable Energy Sector and Youth Employment in Algeria, Libya, Morocco and Tunisia, (2016), https://www.afdb.org/fileadmin/uploads/afdb/Documents/Publications/The_Renewable_Energy_Sector_and_Youth_Employment_in_Algeria__Libya__Morocco_and_Tunisia.pdf.

14 Karim Choukri, Ahmed Naddami and Sanaa Hayani, “Renewable energy in emerging countries: lessons from energy transition in Morocco,” Energy, Sustainability and Society 7 (2017), https://doi.org/10.1186/s13705-017-0131-2.

15 Ibid.

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Malak Altaeb and Loujaïn Guiga

Malak Altaeb is an analyst at Storyzy, an independent writer, and a researcher from Libya based in Paris, France. She holds a master’s degree in Environmental Policy from Sciences Po Paris, and a bachelor’s degree in Chemical Engineering from the University of Tripoli, Libya. Malak is a graduate of the North African Policy Initiative’s Young Policy Leaders Program, during which she researched and wrote a policy paper on Local Agribusiness Development in Tripoli, Libya. She recently published a paper on water politics in Libya with the Arab Reform Initiative. She is a member of the Libyan Youth Climate Movement and also the Association Sciences Po pour l’Afrique. She has contributed to different domains and magazines, such as sister-hood magazine, Alfusaic, and Libya’s Herald. Loujaïn Guiga is a graduate of Public Law and Institutional Relations from Paris 2 Panthéon-Assas University. She also earned a Master’s degree in International Affairs from Sciences Po Paris with a specialization in International Public Management and research Political Science focusing on the use of history in political discourse in Tunisia after 2011.