The World Bank's Power Sector Emergency Action Plan for Lebanon indicated that the electricity sector in Lebanon has been at the center of the country's economic and fiscal imbalances for decades. It noted that the sector has not adequately supplied electricity to consumers, which has significantly impacted economic and social development, and increased public distrust. It estimated that Electricité du Liban (EdL) secured only 55% to 64% of Lebanon's electricity needs in 2018, while private diesel generators supplied the remainder of the country's electricity demand.

It indicated that the cost of supplying electricity in Lebanon is elevated, largely due to the cost of fuel, including the cost of temporary generation through barges, as well as expenditures for power purchases from Syria, and operation and maintenance costs. It pointed out that the cost of fuel accounted for 64.5% of the total $2.6bn cost of supplying electricity as estimated in 2018, which makes the electricity sector vulnerable to fluctuations in international fuel prices. It said that operation and maintenance expenditures followed with 27% of total electricity costs, while expenses for power purchases represented 8.5% of the total. It pointed out that Treasury transfers to EdL averaged 3.8% of GDP annually in the 2008-18 period, which represented about 50% of the country's average annual fiscal deficits. It added that the government transferred a record high of $2.2bn to EdL in 2012, which was equivalent to 5.1% of GDP. 

The World Bank indicated that EdL is constrained by challenges in its governance structure, by limited control over its budget that dilutes its focus on improving operations and services, as well as by a lack of transparency in its finance, human resources, procurement, accounting and technical planning processes. It identified priority actions that it classified under the governance, security of electricity supply, financial stability, and environmental sustainability pillars. 

In terms of the governance pillar, it called on authorities to establish the Electricity Regulatory Authority (ERA), which will help safeguard the sector's transparency and promote accountability. It also stressed on the importance of modernizing EdL through strengthening its governance structure, core business areas, operations, and administrative processes. It encouraged the Ministry of Energy & Water to establish a department for energy infrastructure planning, and to develop a framework that redefines the roles of all major stakeholders, such as the Lebanese Petroleum Administration and the Lebanese Center for Energy Conservation, in the planning process.

In terms of the security of electricity supply, the Bank highlighted the importance of mainstreaming and expanding renewable energy generation, which has played a secondary role in the sector so far, in order to reduce the dependency on costly imported fuels. It said that the government will need an additional 4,700 megawatts of renewable energy capacity in the next 10 years to reach its target of producing 30% of electricity demand from renewable energy sources by 2030. It also stressed on the need for authorities to accelerate the installation of the floating storage regasification units at Zahrani in the South and at Deir Amar in the North to import gas, as well as to launch separate tender processes for additional temporary and permanent generation capacity. 

In terms of financial stability, it called on the authorities to pursue tariff reforms based on a clear action plan, and to adopt a framework to lift subsidies while protecting the poor. It also stressed on the importance of reducing technical and non-technical losses on EdL's distribution network through accelerating the rollout of smart meters, and of improving revenue collection through establishing a mechanism that facilitates the timely payment of electricity charges by public institutions. The Ministry of Energy & Water estimated the accumulated arrears of public institutions to EdL in the last 10 years at over $1.2bn. In terms of environmental sustainability, the Bank called on authorities to reinforce policy, regulatory, infrastructure, financing and capacity building mechanisms to promote and implement wider energy efficiency measures.

The World Bank concluded that the implementation of these priority actions would reduce the cost of supplying electricity in Lebanon, would increase energy supply to provide customers with reliable electricity, and would eliminate the need for costly and polluting private diesel generators.