A row over America’s ultimate strategy in Iraq further stymied reconstruction of the sector, to the point where reconstruction expenditure in Iraq had only hit around $10 billion of the $18 billion of US allocated funds by 2006, and even then a significant portion of those funds had been spent on the Iraqi Security Forces. Against the odds, electricity production eventually rose, even keeping the lights on in Baghdad in the spring of 2004 for 16 hours.
But it was not enough: most Iraqis experienced only a few hours of electricity a day for the next few years, despite the fact that production steadily rose during this period, albeit hampered by insurgent attacks. Emerging from the sanctions, Iraq was flooded with cheap electrical goods and as per capita income steadily rose, more people could afford them, placing unbearable strain on the supply. This problem was compounded by theft from the electricity supply, a situation Harry Istepanian attributes to the loss of faith Iraqis had in their new leadership.
This grim situation continued until the Iraqi government reaped enough oil revenue to spend significant sums on raising electricity generation, aided by loans from Japan amounting to $3.5 billion. But protests over electricity supply have continued until last year and may yet happen again. Explaining the challenges facing Iraq’s Ministry of Electricity is Harry Istepanian, a senior fellow at the Iraq Energy Institute. He was one of early experts deployed by the US Defense Department in May 2003 on the reconstruction of Iraq electricity. Harry is an independent power consultant based in Washington, D.C.