Lebanon: Stable Market Gains New Momentum
The Lebanese Center for Energy Conservation (LCEC) has just finished a market survey on the newly installed collector area per collector type over recent years. The newly added area in 2015 was 53,976 m² with a slightly higher share of vacuum tubes, which went up from 54 % in 2012 to 60 % last year (see chart on the left). After two years of decline, market volume again increased in 2015 by 2.4 %. “The study considered all delayed applications as well as market projections based on data received from banks and suppliers,” Rani Al Achkar, Senior Programmes Engineer at the LCEC, said.
Since October 2010, solar water heater customers have been able to apply for an interest-free loan at one of the eleven active Lebanese banks, with the loan having to be paid off over five years. They can also profit from a USD 200 grant if they had a qualified supplier install a certified solar water heating system at their house.
LCEC said that around 5,335 grants had been approved since the introduction of the support scheme, which will end once a total of 7,500 systems has been subsidised (find more information in the database of incentive schemes). Last year, the banks received 1,517 loan applications, of which 1,407 came from LCEC-qualified companies, which are eligible for grants. As of March 2016, 362 applications are expected to be approved for the USD 200 grant. Al Achkar explained that the approval process takes quite some time, as banks gather applications first before handing a bundle of them over to the Central Bank of Lebanon to be received by the LCEC. “Once we have received a batch of applications, the LCEC has to request any missing information from the banks or directly from the supplier, which is why 2015 applications are still pending approval,” the engineer explained.
New momentum: Increased awareness of cost saving
“The solar water heater market is witnessing new momentum,” the LCEC’s Good-to-Know newsletter observed in January 2016, referring to the increasing number of customers who pay for their solar water heaters in cash and no longer rely on a loan. “While the financing mechanism served to launch the market, people are now aware of the benefits of installing solar water heaters and prefer to pay in cash without asking for financial incentives,” Al Achkar said. “We are currently investigating if a follow-up scheme would be needed once a total of 7,500 systems has been subsidised, especially since most of the market is no longer dependent on grants.” Obviously, the zero-interest loan scheme will continue, even if the grant scheme ends.
The long-term work of the LCEC under the auspices of the Global Solar Water Heating Market Transformation and Strengthening Initiative (GSWH) has paved the way for increasing awareness on the costs saved by solar water heating and heightened overall customer satisfaction with the performance and the service of installers.