Iraqi Demand for Iran Power Supply Increase: Drivers, Messages

Alwaght- As the heat season arrives, the power shortage again presents itself in Iraq as a top challenge and concerning case for the government in Baghdad. In past years, power shortage sparked protests especially in the southern provinces, with the ptotesters expressing discontent with the poor government performance in supplying this service. The most important protest wave hit Basra in 2019.

The officials of the Iraqi Ministry of Electricity have already started their efforts to guarantee fuel supplies for power plants to run through the summer and also to increase the electricity imports. As in previous years, the main focus of Baghdad to meet its electricity needs is Tehran. Iran has been a major source of power supply to Iraq since 2004. About 40 percent of Iraq’s electricity comes from Iran, which has been one of the reasons for close relationship between the neighbors.

 Iraqi officials recently demanded Iran to increase its power and energy supplies to their country in a significant demand. It is significant because this demand comes while the US and Arab countries since past few years have been engaged in unceasing struggle to cut Iran from the Iraqi energy and electricity market.

Two reasons seem to have encouraged Baghdad to apply for more Iranian power supplies:

Iraqi push for power self-sufficiency and Iran’s comparative advantage

Iraq currently needs around 29,000 megawatts of power to meet its needs, but the country now can produce 19,000 megawatts despite all the efforts made by Baghdad to increase the production. Ahmad al-Abadi, the electricity ministry’s spokesman, said that despite limited financial resources and a failure to approve this year’s federal budget, the ministry managed to reach 19,000 megawatts. “Our next plan is to push the production to 22,000 megawatts before the summer with renewal of power plans in a number of provinces,” he added.

The fact is that with the accumulated economic problems in Iraq, Prime Minister Mustafa al-Kadhimi’s government is deeply concerned that the shortage of electricity in the coming summer will rekindle anti-government protests. In the summer, Iraq usually suffers from long hours of power outages during the day amid extreme heat. The government this year wants to cut the need for power by adding more than 3,000 megawatts to its production capacity.

Iraq’s eyes are on Iran and there are two important reasons for that. First, Iran has comparable advantage for Iraq electricity imports in comparison to other countries. Second, due to the deep Iraqi-Iranian bonds, Tehran more than once showed its readiness to help the Iraqi government and society. At the time being, Iraq’s debts to Iran are around $2.6 billion and the Iraqi officials try to pay them off.  Baghdad expects Tehran to increase its gas to Iraq to the previous levels, namely 50 million square meters per day to avoid power outages in the coming summer. All in all, the Iraqis are aware of the Iranian importance in their power provision and also its advantage compared to other providers.

Arab countries unable to replace Iran energy supply to Iraq

Over the past year, many foreign news outlets, especially Arab media, have reported on the negotiations between the Arab countries and Iraq to meet the latter’s energy needs and enter into a kind of energy alliance with Baghdad.

The reality is that since last year, the US government has encouraged energy companies to invest in Iraq’s electricity sector. Washington also encouraged Arab countries to enter into cooperation with Iraq to supply Iraq with power and thus replace Iran. Reports talked about $1.4 billion deal between Iraq and the US’s General Electric for delivery to Iraq of 54 advanced gas turbines to guarantee power stability. But not only so far were none of the promises of help fulfilled but also Iraq more than ever needs the Iranian help.

It is worth mentioning that the Persian Gulf Arab monarchies are not very much interested to cooperate with Iraq due to their inadequate power and it is the US that encourages the negotiate electricity with Baghdad. The certain point is that none of them can replace Iran as a major power supplier to Iraq.