$6.25 Billion to Build 50 New Power Plants

Iraq plans to sign power plant contracts valued at $6.25bn [7.3 trillion Iraqi dinars] next week with Caterpillar and other companies, according to Arabian Business.

Caterpillar, Man SE of Germany and at least one South Korean company will build 50 new power stations, each capable of generating 100 megawatts, Electricity Minister Raad Shallal said on Thursday.

"In the short term, nationwide we will build 50 stations with a capacity of 100 megawatts," he told reporters.

"Work will begin immediately and be completed in the summer of 2012, but the first effects will be felt next winter" when the plants connect to the grid, he added.

Iraq’s power plants and distribution network have suffered from years of war, sanctions, insurgent attacks and under- investment.

Iraqis currently receive power from the national grid for an average of about one in every five hours. Chronic outages are hampering the economy, and violent street protests over unreliable electricity supplies have made the issue a major concern for the government.

Former Electricity Minister, Karim Wahid, resigned last June after two people were killed while rioting over summer blackouts and power rationing.

Wahid said at the time that his efforts to tackle the problem had failed because of a lack of money and fuel. Prime Minister Nuri al-Maliki pledged after forming his new government in December to address the problem.

The planned investments are part of a plan to end power shortages completely by 2015. Power supply this summer, the peak season for electricity consumption, will improve to an average of eight hours a day nationwide, up from about six hours a day last summer, Shallal said.

Iraq produces 7,000 megawatts and imports an additional 1,000 megawatts, while demand totals about 14,000 megawatts, he said.

The country imports electricity mainly from neighboring Iran and Turkey, which has also sent two ships to southern Iraq where they serve as floating power plants, Masaab Serri, an Electricity Ministry spokesman, said on Jan. 4. Iraq is in talks about importing electricity via Syria using a regional grid.

The government invited bids in December for the construction of four power plants to raise generating capacity by 2,750 megawatts.

Those bids will be for a 1,250-megawatt plant near Basra, and three plants of 500 megawatts each in the cities of Samawa, Diwaniya and Amarah.

The contracts to be signed next week for 50 smaller plants would be in addition to these earlier projects.

(Source: Arabian Business, Middle East Online)

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