Electricity Shortage "Costs Iraq $40bn a Year"

In Iraq, delays are caused by contracts held by inexperienced companies that are locally executed by non-specialized government officials. Meanwhile, there should be an integrated project or plan that takes into account the increase in annual power consumption rates, the most economical fuel to be used depending on the availability in the concerned state, the possibility of using solar and wind power alternatives to supply additional power and the possibility of electrical interconnection with neighboring countries.

This is the case in the region under the initiative of the Arab Fund for Economic and Social Development (AFESD). Other considerations include environmental impacts of alternatives, the possibility of cooperation with the private sector to invest in the electricity generation sector — provided that bidding companies are not owned by relatives and friends of officials and enjoy the necessary experience — and the study of pricing which helps rationalizing electrical energy consumptions without harming the poor classes.

This is not new; there are several global studies in this field. The electricity crisis is but one of numerous crises hitting the energy sector of Iraq. Others include the emergence of two different oil industries in the country since 2003, one in the federal state and the other in the Kurdistan Region of Iraq. The disputes between these two industries are being exacerbated and are likely to get worse soon in terms of oil and politics, should the Kurdistan Region of Iraq start exporting oil directly to Turkey without the Iraqi federal government’s consent, which would be an express violation of the constitution.

On a different note, the ambitious plan to produce 12.5 million barrels of oil per day by 2017 faces numerous obstacles, as predicted by many Iraqi oil experts. The question is: Why is there this rush to produce that much oil in such a short time? It is well-known that Iraq’s huge oil reserves placed it among the top five countries in the world in proven reserves. Thus, it is crucial for Iraq to develop the discovered fields and promote exploration programs to find new fields.

Yet, the country has witnessed delays in this respect over the past few decades due to wars and the international embargo. It is well-known by now that promoting this oil plan — which is difficult to achieve in a very short time — underlies an attempt to provide the general budget with the highest oil income possible so as to fulfill short-sighted political commitments. These include the employment of the largest number possible of civil servants — whether they are necessary or not — and saving necessary money for officials to buy people’s loyalty.