SYRIA - The Power Sector.

There has been rapid growth in electric power generation capacity in Syria in recent years. Installed capacity now is over 8,200 MW, compared to a little over 4,000 MW in early 1998. This includes 900 MW in hydro-power plants which are only operating at about 300 MW. Annual demand for electricity has been growing at the average rate of 10% in recent years.

In 2007, Syria had a summer of power failures and electricity shortages, and claims by PM 'Utari that US and EU economic pressures were to blame were being greeted with scepticism by a weary public. 'Utari's claims marked a shift in position in a regime which had long held that US pressure had a negligible impact.

Many Syrians in 2007 said their electricity woes were more a function of government incompetence than of international pressure. In an Aug. 5 article on Syria-News.com, a private online news agency, Nidal Ma'louf, director of the Syrian Economic Centre, wrote: "According to my knowledge, the official line has been that America's sanctions and its policy of isolating Syria are both failing. Now the government is trying to find an excuse for its failure to provide cities with the most basic needs".

Issam al-Za'im, a former minister of industry and outspoken political commentator, said the PM's remarks were an attempt to avoid blame for years of procrastination in upgrading a national power grid still operating on technology decades old. Za'im said: "The main problem for Syria is a total lack of planning for the future. Sanctions may be having an effect, but bad governance is the main factor, and we're seeing none of our officials being held accountable for their mistakes".

The power failures occurred in one of the warmest summers in recent memory. In Damascus, which had daily blackouts lasting as long as five hours, the roar of gas generators drowned out the city's notoriously loud traffic. In some suburbs, the lights were on for only six hours a day.

Syria, a regional supplier of electricity, had to suspend exports to Lebanon and northern Iraq several times last summer to conserve energy. Za'im said: "These power interruptions are costing the country dearly. This is affecting our ability to pump water around the country, which not only affects human consumption, but industry, agriculture, just about everything".

US sanctions (see OMT of this week) are affecting power generation. Construction contracts for two large power plants, needed to keep pace with rising energy demand, went up for bid on the international market five times in 2005-07 with no takers. Of the companies capable of building them, PM 'Utari accused General Electric of the US of declining to bid on the job and persuading Mitsubishi of Japan not do bid, either.

'Utari on Aug. 4 said Alstom of France was "pressured by [ex-President] Jacques Chirac not to work in Syria". In a speech in Lattakia, 'Utari then said: "The postponement in constructing these plants is a result of political reasons".

Andrew Tabler, editor of Syria Today Magazine, in late 2007 was quoted as saying: "Syria now finds itself in a situation where the number of companies that can build big power facilities are limited, and the ones that can do this have apparently followed the American lead because they fear the repercussions of doing business here". Tabler said of the US sanctions: "Like the sword of Damocles, [President] Bush has the option of coming down hard on the heads of multinationals dealing with Syria".

Though US companies legally may invest in Syria, some have hesitated and IOCs like ConocoPhillips, Marathon and Devon Energy have pulled out over the past four years.

The government in 2007 estimated that power output had to increase 9% that year to keep pace with an influx of 1.5m Iraqi refugees, a high local birth-rate and an emerging private sector with accelerating levels of electricity consumption. Tabler said. "There are certain things that Western companies dominate, like power generation facilities. It's just hard to get around these facts".

Syria's power generation capacity should exceed 11,500 MW by 2010. The state-owned Public Establishment of Electricity Generation & Transmission (PEEGT) is in charge of the power sector. It gets its fuel and gas feedstocks at heavily subsidised prices and provides power at subsidised prices as well.

Iran is helping in the power sector. The first phase of of power plant in Banias backed by the Export Development Bank of Iran (EDBI) was inaugurated on June 19, 2007. Iran's Azarab Energy Industries Co. administered the project - the reconstruction of the first and second phases of the plant. The $18m project was implemented within 18 months - with $11m provided by EDBI and $7m financed by Damascus.

In late 2007 an agreement renewing a contract to provide Lebanon with 60-200 MW through Tartous was signed by the Director of the Syrian Public Institute of Energy Hisham Mashafaj and Director General of Lebanese Electricity Kalam Hayek. Through the Tartoos transmission station, Syria has been selling power to Lebanon since 1997. But Lebanese experts in early 2008 said Syrian power supplies might be interrupted, mainly during the summer months, as was the case in 2007.

Syria gets power from Egypt through Jordan in a system which, eventually, is to become pan-Arab and will link up with Europe. Now North African countries are connected to Jordan, Syria and Turkey through Egypt. Once a Saudi-Egyptian grid is completed, the pan-Arab grid is link the GCC countries to the EU, to allow the trading of electricity across the two regions. It would bring the GCC area in line to join the world's largest electrical inter-connection scheme, the Mediterranean Ring Project.

Arab energy ministers and EU politicians attending a high-level conference in Damascus in late 2007 announced support for a revolutionary renewable energy supply system proposed by Germany to link both areas. The Damascus Declaration adopted at the Fourth Middle East and North Africa Renewable Energy Conference (MENAREC4) advocated "large-scale renewable energy systems" which envisaged vast solar electricity fields in the MENA region supplying electricity to the EU.

The conference - comprising 34 national delegations, 19 international organisations, 60 technical presentations and an exhibition - was entitled "The Way Forward for Renewable Energy development and Technology Transfer: EU-MENA Co-operation".

The Syrian Minister of Electricity Dr Ahmad Khaled al-'Ali was to present the document to a Conference of Euro-Mediterranean Ministers of Energy in 2008. Speaking at the Damascus event, Germany Environment Minister Sigmar Gabriel said: "We now need much less focus on new oil and gas pipelines. If the issue of renewable energies is not placed high on the agenda of the Euro-Mediterranean Partnership and other donor meetings it will not become an EU co-operation priority... A German Aerospace Centre study has shown that solar/thermal power plants...in the Arab countries could make a significant contribution to future EU energy supplies. Single plants are already under construction in Morocco, Algeria and Egypt and planned for Libya and Jordan".

A "Trans-Mediterranean Inter-Connection for Concentrating Solar Power (Trans CSP)" study advocates an integrated EU-MENA energy system which would ensure that, by 2050, 80% of the two regions' electricity supplies would be derived from renewable sources, the balance from fossil fuels. There would be no role for nuclear energy.

Arab CSP plants (comprising desert-based arrays of curved mirrors reflecting sunlight onto absorber tubes or towers) would supply national demand for power, heating and cooling, while exporting power to the EU via trans-Mediterranean High Voltage Direct Current transmission lines, to be connected to existing EU grids.

Renewable energy produced in Europe - whether from CSP plants in the south as well as wind, geothermal, hydro-power and biomass - would be fed into the new system. Large-scale CSP-powered sea-water desalination (Aqua CSP) could be associated with the new EU-MENA system. Solar energy received on each sq km of desert can be used to generate power to desalinate 165,000 CM/d (or 60m CM/y). The study says rapid introduction of this technology could terminate unsustainable regional water resource use by 2030.

Presentations during the conference from three regional offices of UN organisations indicated patchy and widely disparate patterns of renewable energy development in Arab countries, facing a host of policy and administrative barriers - including highly subsidised cheap electricity competing with renewable technologies - as well as the lack of adequate fiscal incentives to consumers for their installation. Present flows of foreign technology and finance were also way below requirements.

However, several speakers emphasised that the previous "fear and distrust" of renewable energies on the part of oil producers had changed into a realisation that they were an essential component of their national energy supplies, as well as a global strategic option for both extending the life of oil reserves and reducing carbon dioxide emissions and thus combating climate change.

CNG & Other Alternative Fuels For Public Transport: In early 2007, the Syrian Ministry of Transport announced plans to use compressed natural gas (CNG) as the preferred fuel for public vehicles. It said it was to import 1,200 buses run by CNG.