Libya (2012)

Degree of reliance on imported energy: 

Libya imports certain oil products such as gasoline due to its outdated refining sector. However, Libya is a net exporter of energy sources by a vast margin. Total crude oil exports in 2009 were 53,123 ktoe, with 5,812 ktoe of refined products being exported in the same year. Natural gas exports in the same period were 7,488 ktoe. With the country holding the largest crude oil reserves in Africa, the domestic oil market is likely to remain export-focused for the foreseeable future. Electricity imports in 2009 totalled 73 GWh, whilst exports amounted to 124 GWh.

Main sources of Energy: 

<p>
Total installed electricity capacity (2008): 6,300 MW</p>
<div>
Total primary energy supply (2009): 20,405 ktoe</div>
<div>
Crude Oil: 102.2%</div>
<div>
Natural Gas: 26.9%</div>
<div>
Combustible Renewables and Waste: 0.8%</div>
<div>
Electricity Exports: -0.02%</div>
<div>
Oil Product Exports: -29.9%</div>
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<div>
Libya does not have a large population, extensive agricultural potential or a well-established industrial base like other North African countries such as Algeria, Egypt, Morocco or Tunisia. The country does, however, have abundant energy resources. Given the country&rsquo;s small population, 6.5 million in 2010, and its large oil and gas reserves, Libya&rsquo;s energy situation resembles that of the small oil-exporting Gulf countries more than that of its North African neighbours. The oil sector provides about 70% of GDP, having risen from 50% in 2002 in line with rising oil prices.</div>
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Electric power is produced from 30 power stations, which are largely oil-fuelled steam turbines, although there are a handful of gas-fired plants, and some turbines have been converted to gas to increase oil capacity available for export and other uses. The peak load in 2006 was 4005 MW, indicating that a comfortable buffer existed between capacity and demand. Electricity consumption per capita in 2009 was 4,068 kWh, far above the North African average. Total electricity generation in the same year was 30,426 GWh.</div>
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After the civil conflict and revolution of 2011, the majority of Libya&rsquo;s energy infrastructure has remained intact. Crude oil and natural gas exports naturally fell during the conflict, however, some analysts have predicted as little as a two-year gap before production of both resources is back up to pre-revolution levels, predominantly due to efforts made on both sides in the conflict to protect the crude oil/natural gas production and distribution infrastructure.</div>

Country: 

Libya

Extent of the network: 

<p>
The electrification of all Libyan towns and cities reached almost 100% of the population as of the year 2005. The Libyan grid is connected to Algeria, Egypt and Tunisia, which have further connections to other networks in Turkey and Morocco with onward links to Europe. The national power utility has indicated that power links with these countries may be developed further, including DC links to European networks, particularly Italy.</p>
<div>
Libya&#39;s power grid consists of roughly 1,037 km of 400 kV lines, 13,548 km of 220 kV transmission lines, with 20,634 km of 66 kV and 30 kV lines, and 32,000 km of 11 kV distribution lines.</div>

Capacity concerns: 

<p>
Almost 80% of the electricity consumed is based on oil. An important goal is to alleviate the dominance of oil-based power production by constructing new natural-gas fired power plants. This would, at the same time, serve the objective to renew the national power generation infrastructure. In 2003, about two-thirds of the installed power generating capacity was more than 20 years old. Hence, the efficiency of the already installed power plants is far below the OECD standard. In 2006, the average conversion efficiency of Libyan thermal power plants was less than 29% compared to 36-40% in most industrialised countries. Transmission and distribution losses stood at 14% in 2009.</p>
<div>
Blackouts in the summer of 2004, mainly due to ageing and faulty generators, led to the current drive to further increase capacity.</div>
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<div>
Whilst power infrastructure has mostly been maintained post-revolution, with a limited level of destruction, which is being quickly repaired, the nation&rsquo;s power grid is still seen as a target for dissenting elements within Libyan society, particularly loyalists to the former dictator.</div>

Potential for Renewable Energy: 

<p>
<u>Solar energy</u><br />
The solar regime in Libya is excellent; the daily solar radiation on the horizontal plane reaches 7.5 kWh/m2, with 3000-3500 hours of sunshine a year. There are few conflicts of land use; 88% of Libyan land area is considered desert, and much of this is relatively flat. There is some compromise between access to water, which is available at the coast but where the solar regime is less favourable, against inland sites with excellent solar characteristics, but far from water.</p>
<div>
1,865 kWp of PV capacity were installed in Libya in 2006. The amount is increasing significantly; in particular, decentralised electricity generation in rural areas is being encouraged. PV systems are also used in agriculture to supply water pumps with electricity instead of using diesel.&nbsp;</div>
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<u>Wind energy</u></div>
<div>
The wind regime is also good. The average wind speed at 40m is between 6-7.5 m/s. There are several attractive prospects along the Libyan coast; one such site is at Dernah, where the average wind speed is around 7.5 m/s. A German-Danish consortium was contracted in 2000 by the national power utility to design and construct a 25 MW pilot wind farm. Several appropriate sites were identified and masts were installed to monitor wind conditions over 12 months. Technical specifications for all the components of the pilot wind farm and tender documents for a turn-key installation of the 25 MW facility were prepared. Bids were submitted, but the project was then, for all intents and purposes, abandoned. The public and private sectors, prior to the 2011 revolution, had announced a total of 5 new wind power projects, with a combined capacity of 600 MW. In addition, targets have been set for 2015 to reach 1,000 MW of wind generation capacity.</div>
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<u>Biomass energy</u></div>
<div>
The estimated biomass potential in the country is 2 TWh/year. Whilst this potential may be suitable for individual residences to exploit for personal power generation, it is deemed to be unsuitable for large-scale electricity generation.</div>
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<u>Geothermal energy</u></div>
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Whilst the potential for large-scale geothermal power generation has not yet been analysed in Libya, studies have been conducted into the potential for Underground Thermal Energy Storage (UTES), whereby excess heat is stored in an underground circulating pipe system. One study has recently been conducted into the possible utilisation of a low-temperature geothermal source near Waddan City, and modelling shows that the local utilisation of the resource for power generation (estimated at 1.3 MW of potential) or refrigeration (1284 tons at 5&ordm;C, or 835 tons at 0&ordm;C), is economically feasible.</div>
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<u>Hydropower</u></div>
<div>
Libya, compared to its other North African neighbours, has a poorly-developed hydropower sub-sector. This is primarily due to the lack of availability of resources in the country for the development of the energy source. There are currently no plans for the exploitation of hydropower in the country. Plans to develop a hydropower installation on the Great Man-Made River Project have not yet come to fruition.</div>

Potential for Energy Efficiency: 

<p>
There is little evidence of any strategy or targets for energy efficiency in Libya and analytical work on the possible potential is lacking. An old study indicated that the potential efficiency savings could amount to 20% over the period 1998 to 2020. Improvements in electricity use could reduce the need for electricity generation by 2,160 MW in 2020. Improvements in supply-side efficiency have been identified as a potential source of significant energy savings. Energy industry electricity usage in 2009 consumed 11.9% of total domestic supply.</p>
<div>
Per capita consumption stood at 3.18 toe in 2009, well above the North African average of 0.9 toe. The transport sector consumes the majority of the country&#39;s petroleum supply, and as of 2009, was the dominant contributor to the country&rsquo;s final energy requirement (37.2%). The commercial and public services sector consumes the majority of electricity in the country (40.1%).</div>
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Energy supply has increased steadily over recent years, and Libya has Africa&rsquo;s highest electricity generation per capita, with 4,739 kWh in 2009.</div>

Ownership: 

<p>
<strong>Electricity market</strong><br />
The General Electricity Company of Libya (GECOL, <a href="http://www.gecol.ly">www.gecol.ly</a>), the state-owned electricity company, is responsible for power generation, transmission and distribution in Libya. The company owns 100% of the long-range transmission grid and 90% of the distribution grid. GECOL&rsquo;s power plants produced 25.5 TWh in 2007. &nbsp;</p>
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<strong>Liquid fuels and gas market</strong></div>
<div>
Libya&rsquo;s oil sector is dominated by the National Oil Corporation (NOC, <a href="http://www.en.noclibya.com.ly">www.en.noclibya.com.ly</a>). It has a monopoly on all oil fields and manages investments in the oil industry through Exploration and Production Sharing Agreements (EPSA). The share of international oil companies (IOC) in Libya&rsquo;s oil concessions was initially as high as 49%. However, recently the Libyan Oil and Natural Gas Council cut the IOC shares to 20%, which requires renegotiations of exploration contracts. Due to this action, and infrastructure constraints, foreign investments, which had increased in recent years, have begun to slow again. National refining capacity prior to the 2011 revolution, totalled 378,000 barrels per day, being provided by five domestic oil refineries, owned by NOC. All refineries are in urgent need of upgrading and maintenance. Oil production rose to 600,000 bbl/day in November 2011, from a low of 20,000 bbl/day in August 2011, and was expected to reach 700,000 bbl/day by the end of the year. However, estimates are that it will take approximately three years to fully restore production to pre-revolution levels.</div>
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NOC is also responsible for natural gas production, and has a monopoly on all new discoveries. As of 2008, Libya had proven natural gas reserves of 1.3 billion toe. This amount increased significantly over the last 20 years since large investments were undertaken to investigate new deposits.</div>

Structure / extent of competition: 

<p>
There have been previous attempts to liberalise the sector, and a draft law was prepared that provided for the legal unbundling of GECOL into companies for generation and transmission, along with several distribution companies. This law was never submitted to the legislature. The law also would have created a regulatory agency and allowed for the participation of private power producers in generation; it would also have allowed operation and maintenance contracts with private contractors. Such industrial reform would have been helpful for RE, as it would create a clear legal framework for IPPs under which a power purchase agreement might be signed with the transmission company.</p>
<div>
However, as the situation currently stands, the electricity market in Libya is entirely under the purview of GECOL, the state-owned, vertically-integrated national utility. The monopoly that the NOC holds over the up- and down-stream oil industries, is also total.</div>

Existence of an energy framework and programmes to promote sustainable energy: 

<p>
The Renewable Energy Authority of Libya (REAOL) has created a RE roadmap up to 2030, that has been approved by the former Ministry of Electricity and Energy. Long-term plans are to cover 25% of Libya&rsquo;s energy supply by renewable energies by the year 2025, rising to 30% by 2030. Intermediate targets are 6% by 2015 and 10% by 2020. Targets have also been set for electrical generating capacity from renewable resources, at 10% by 2020, and 30% by 2030.</p>
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There is no formal government procedure for ensuring that physical development of infrastructure and buildings follows an energy efficient and sustainable path. The Libyan &ldquo;Five Points Company for Construction and Touristic Investment&rdquo; has announced that it will sign a contract with the Gulf Finance House to build an &ldquo;Intelligent Energy City&rdquo; in Libya, at a cost of US$5 billion. Libyan institutions will bear 40% of the cost, and the Gulf Finance House, 60%. The project will contain centres for databases, environmental assessment and RE, in addition to special compounds for oil and natural gas producing companies, energy sector services and manufacturing industries. Whether this development will actually occur, given the present financial climate and the recent political instability, is uncertain. The lack of concern for EE in transport and spatial planning is another factor to be considered in the country&#39;s future energy planning.</div>

Current energy debates or legislation: 

<p>
There is no energy efficiency law in Libya. Some considerations regarding energy efficiency were included in a previous draft electricity law, but this law never reached the statute book and was withdrawn when the Ministry of Energy was disbanded. It is understood that a new law on energy efficiency is in preparation, but its contents are as yet uncertain.</p>
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Currently, the majority of energy development in the country is focused on re-establishing normal, pre-conflict grid operation, and re-establishing oil production, to return exports (which account for the majority of the country&rsquo;s foreign revenue) to pre-conflict levels.</div>

Major energy studies: 

<p>
Libya is a member of the Regional Centre for Renewable Energy and Energy Efficiency (RCREEE), formally established in 2008 as an independent regional think tank, based in Cairo, dedicated to the promotion of RE and EE, comprising ten North African countries. In addition, the RCREEE encourages the participation of the private sector in order to promote the growth of a regional industry of RE and EE. In the current start-up phase the Centre is financed by Denmark (DANIDA), Germany (Federal Ministry of Economic Cooperation and Development), the European Union and Egypt. Activities of the RCREEE include the formulation and dissemination of policies aimed at the promotion of renewable energies and energy efficiency, supporting the development of new technologies in the fields of RE and EE, and encouraging the private sector to actively participate in the development and production of renewable energies and energy efficiency.</p>
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Libya is also a member of the Arab Maghreb Union, and is hence involved in COMELEC, the regional power project aimed at increasing inter-connection between the Maghreb states, as well as further development of inter-connections with Europe for the purposes of power trading.</div>
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Role of government: 

<p>
Prior to the 2011 revolution, the institutional setting was not favourable for sustainable long-term policies and strategies. In 2008, the Ministry of Electricity and Energy was disbanded, and its responsibilities shifted to the Energy Council. Formally established by the Prime Ministerial Decision of 8 September 2009; the Council is chaired by the Prime Minister, and is comprised of the Ministers of Industry and Economic Development, Planning and Finance, and Municipalities together with the Chairmen of the Environmental General Authority, REAOL, GECOL, the NOC, the Atomic Authority, the Solar Energy Research Centre, the Libyan Bank and the National Security Council. The Ministry of Transport is a notable omission. The Council is to meet every three months.</p>
<div>
The Energy Council has the mandate to organise the broad range of all energy matters. It serves as a mechanism of decision making in areas where inter-ministerial cooperation is vital, for example strategy and pricing. It also performs tasks that would normally be done by a Ministry of Energy which, as mentioned, has been suppressed; for example structuring of the sector, investment management, and the provision of information. Lastly it micro-manages the operating entities, creating conflicts of function, risks of confusion and delays. Generally, the policy-making process lacks transparency and inter-institutional communication structures.</div>
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It is currently unclear as to whether the Energy Council is still functioning within the government, post-revolution. The National Transitional Council&rsquo;s initial plan for governance during the transitional period does take into account the continued existence of public utilities, hence it can be inferred that the majority of the former government&rsquo;s organs were to be maintained through the transitional period.</div>

Government agencies in sustainable energy: 

<p>
The Renewable Energy Authority of Libya (REAOL) was established in 2007 as a management, research and planning agency for the introduction of renewable energy. The authority has been provided with US$ 487 million of funding for the period until 2012. REAOL&rsquo;s current target is to achieve a 10% share of energy from renewable sources in the energy mix by 2020, from recent negligible levels.</p>
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REAOL was originally a solar research centre within GECOL. GECOL was asked by the government to develop proposals for concrete projects concerning renewable energy, and so the research centre was upgraded to a Department within GECOL. Subsequently the Department was separated from GECOL and became a dedicated agency depending on the Ministry of Electricity. Soon afterwards the Ministry of Electricity was suppressed and REAOL (along with other agencies such as GECOL) was transferred to the direct supervision of the General Peoples&rsquo; Committee for Electricity, Water and Gas. The Centre is responsible for research studies on solar energy and wind. It has no direct policy role.</div>
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The Centre for Solar Energy Studies (CSES) is based in Tripoli, and performs studies and research programs in the field of solar energy, and promotes use of both PV and solar thermal technology within the country. Its main objectives are to promote and perform solar desalination projects, as well as the research and development of solar water heating technology in the country. The organisation works closely with GECOL in the promotion of PV technology, in particular.</div>

Energy planning procedures: 

<p>
The present National Plan covers the period from 2008-2012; it contains a chapter on renewable energy, and provides for operating funds for REAOL. However, no investments are foreseen other than a wind plant at Dernah. The plan is essentially indicative. Budgets for entities funded through the Plan are allocated annually. This makes long-term planning very difficult. It is likely that preparations for the subsequent plan will be postponed, until the current issues of governance are solved.</p>
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A new draft electricity law has now been prepared, which is understood to be similar to the Egyptian law. It contains explicit provisions for RE and EE, but it appears that these two topics may be removed from the draft and treated later in special purpose laws. The strategy will purportedly restructure REAOL to take care of EE as well as RE, and will distribute any physical assets of REAOL into a separate company, to avoid conflicts of interest between regulatory and commercial functions.&nbsp;</div>
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REAOL has prepared a medium-term plan (2008-2012) to promote RE in Libya and to meet these targets. The Plan addresses projects in solar and wind and stimulating local manufacture of equipment for RE. This plan comprises several wind farms with a total proposed capacity of marginally less than 1,000 MW, including:</div>
<ul>
<li>
the Dernah wind farm (120 MW in two stages),</li>
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the Al Maqrun wind farm (240 MW in two stages),</li>
<li>
Western region farms at Meslata, Tarhunah and Asabap (250 MW),</li>
<li>
South Eastern region wind farms at Gallo, Almasarra, and Alkofra, Tazrbo (120 MW),</li>
<li>
South Western region wind farms at Aliofra, Sabha, and Gatt, Ashwairef (120 MW).</li>
</ul>
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The solar component includes PV and solar thermal technology:</div>
<ul>
<li>
Three large-scale PV plants connected to the grid at Aljofra, Green Mountain, and Sabha (5-10 MW each),</li>
<li>
Extending the use of PV technologies in remote areas (2 MW),</li>
<li>
1000 PV roof top systems for residential areas (3 MW),</li>
<li>
A feasibility study for a CSP plant in unspecified location (100 MW),</li>
<li>
The development of a joint venture with local and foreign investors for the manufacture of solar water heaters for the local and export markets (40,000 units/year),</li>
<li>
The development of a joint venture with local and foreign investors for the assembly of PV systems (50 MW).</li>
</ul>
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However, these RE targets and strategy do not seem to be fully shared by all involved parties, despite the approval of the target by the Cabinet. The lack of consensus means that REAOL&rsquo;s programs and targets may not be realised on the time-scale envisaged.</div>
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Libya is currently involved in the planning of a number of regional interconnection projects, being located in a unique geographical position between Europe, North Africa and the Middle East. Options that the country is considering include a submarine, 500 kV DC connection with Italy under the Euro-Maghreb interconnection project, a second 400/500 kV AC overhead line to increase interconnection capacity with Egypt, and a third, 400 kV line connecting the country with the Tunisian power network.</div>

Energy regulator Date of creation: 

There is no regulatory agency in the country. The Energy Council was responsible for all operations in the sector, including such regulatory measures as are necessary for the sector&#39;s operation, prior to the 2011 conflict.

Degree of independence: 

The Energy Council was comprised entirely of government agencies, chaired by the Prime Minister. Funding for the council and its constituent members came directly from the national budget, and operating revenues of the involved government companies.

Regulatory framework for sustainable energy: 

There is no legislation covering financial support for renewable energy, and addressing the issue of the additional costs of renewable energy compared to the least cost alternative should be investigated. Furthermore, there is no clear legislative basis for the participation of private capital in the power sector. Current drafts of the electricity law are hypothesised to contain measures for the promotion and financing of RE and EE, but no definite measures are currently in place.

Regulatory roles: 

The Energy Council was responsible for all activities in the energy sector prior to the 2011 revolution, including regulatory functions for both the oil and electricity sub-sectors. Previously, under the former Ministry of Energy, tariff- and standards-setting was the responsibility of the respective national utilities. Since the establishment of the Energy Council, responsibility for these activities has been transferred directly to the government, and current trends appear to suggest a more state-oriented regulatory approach for the future.

Role of government department in energy regulation: 

<div>
The tasks of the Council included:</div>
<ul>
<li>
Preparing and suggesting policies and strategies for the energy sector, and to promote coordination among stakeholders,</li>
<li>
developing the energy sector structure,</li>
<li>
the establishment of policy to manage demand,</li>
<li>
establishing a strategy for pricing,</li>
<li>
collecting available information,</li>
<li>
the evaluation of sources of energy, especially solar,</li>
<li>
energy forecasting,</li>
<li>
establishing procedures for investment in the energy sector, and</li>
<li>
the approval of contracts with foreign companies.</li>
</ul>

Regulatory barriers: 

<div>
Previously, government entities in the energy sector formulated policy independently and pursued their own interests, with little consideration for co-operation. The NTC appears to be firmly committed to changing this, taking such measures as to release revenue statistics from national oil sales for transparency purposes, in mid-2011. However, whilst the situation in the country is improving, the current lack of a coherent government precludes the ability to formulate policy for the energy sector, and the establishment of a stable and accountable body responsible for the energy sector is a vital first step to regulatory reform in the country.</div>

References: 

IRENA (2010) &quot;Renewable energy country profile: Libya&quot;. Available at: http://www.irena.org/REmaps/countryprofiles/africa/Libya.pdf [Accessed 28 July 2013]&nbsp;<br />
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IEA Country Energy Statistics 2009. <a href="http://www.iea.org/stats/countryresults.asp?COUNTRY_CODE=LY&amp;Submit=S... 28 July 2013]<br />
<br />
InvestmentU: &quot;Will a new Libya usher in the European energy revolution?&quot;, 25th October 2011. <a href="http://www.investmentu.com/2011/October/the-european-energy-revolution.h... 28 July 2013]<br />
<br />
Revolutionary Program: &quot;Libya oil survives revolution&quot;, 25th October 2011. <a href="http://revolutionaryprogram.blogspot.com/2011/10/libyan-oil.html">http:/... 28 July 2013]<br />
<br />
Global Transmission Report: &quot;MedRing: building an interconnected system across three continents&quot;, 2nd March 2009. <a href="http://www.globaltransmission.info/archive.php?id=1433">http://www.globa... 28 July 2013]<br />
<br />
Tripoli Post: &quot;Libyans capture former regime loyalists plotting explosions&quot;, 2nd January 2012. <a href="http://www.tripolipost.com/articledetail.asp?c=1&amp;i=7603&amp;archive=... 28 July 2013]<br />
<br />
Masheiti, S. and Agnew, B. (2010) &quot;Thermodynamic simulation modelling of&nbsp;low-temperature geothermal source located in arid-zone area North Africa&quot;.<br />
<br />
GECOL: <a href="http://www.gecol.ly/aspx/main.aspx">http://www.gecol.ly/aspx/main.aspx</... 28 July 2013]<br />
<br />
Wood Mackenzie: &quot;Libya unrest: key considerations for energy markets&quot;, 24th February 2011. <a href="http://www.woodmacresearch.com/cgi-bin/wmprod/portal/corp/corpPressDetai... 28 July 2013]<br />
<br />
RCREEE: <a href="http://www.rcreee.org/aboutus/background0/">http://www.rcreee.org/aboutu... 28 July 2013]