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2.5 Million Iraqis and Businesses to Benefit from Improved Electricity Services

A new US$200 million World Bank project will provide increased and more reliable supply of electricity to about 2.5 million Iraqis and productive enterprises in the governorates of Basra, Al-Muthanna, Thi Qar, and Missan who currently suffer from frequent and long power cuts and rely on private or shared generators to cover the shortages within the public network.

The Electricity Services Reconstruction and Enhancement Project, approved today by the World Bank Group’s Board of Executive Directors, will support the Government of Iraq’s efforts to improve the quality and reliability of electricity supply by reducing the capacity limitations in the electricity distribution and transmission network.

The project aims to support increased efficiency of electricity operations and management which is key to reducing the fiscal burden levied by the sector on Iraq’s budget, drawing resources away from other public sector needs such as reconstruction, health and education.

Saroj Kumar Jha, World Bank Mashreq Regional Director, said:

“The lack of access to reliable power has a significant impact on household well-being, business growth, and the capacity of the enterprise sector to create sustainable jobs for the growing numbers of youth entering the job market.

“Improved electricity supply will support job creation, including enhancing women’s ability to engage in income generating activities. It will also promote economic diversification and allow enterprises to increase their productivity, thus fostering inclusive economic growth and shared prosperity for the population of Iraq South region”.

The project will support the reconstruction and rehabilitation of the electricity transmission and distribution grid including installation of new lines and power substations. In addition, the project will include installation of an Integrated Management Information Systems and customer call centers.

These activities will not only increase the network capacity to deliver electricity to the consumer premises, but will also support improvements in network operations efficiency and customer care such as reducing the duration of electricity outages, improving the accuracy in meter reading and billing records and fast response to electricity consumer concerns.

Paul Baringanire, World Bank Senior Energy Specialist and Project Team Leader, said:

“Improved efficiency, transparency, and accountability of operations will not only improve the sector’s performance but also enhance the image and credibility of the sector institutions namely the Ministry of Electricity, the South Electricity Transmission Company, and the South Electricity Distribution Company with shareholders and electricity customers thus contributing to restoring citizen confidence and gaining support for sustained operations.”

(Source: World Bank)

Germany's Siemens and the Iraqi Ministry of Electricity have agreed on the award of contracts valued at approximately EUR 700 million for Phase 1 of their "Iraq Roadmap", covering short-, mid- and long-term addition of new highly-efficient power generation capacity, rehabilitation and upgrade of existing plants, and the expansion of transmission and distribution networks.

The agreement builds on the exclusive Memorandum of Understanding signed between the ministry and Siemens in October last year, and outlines the specific projects, associated budgets and timelines for the execution phase, covering all essential elements of the electrification of Iraq.

The document was signed by Joe Kaeser (pictured), President and CEO of Siemens AG, and Luay al-Khatteeb, Iraq’s Minister of Electricity, in Berlin in the presence of Adil Abdul-Mahdi, Prime Minister of Iraq and Angela Merkel, Chancellor of the Federal Republic of Germany.

Projects include the EPC construction of a 500 megawatt gas-fired power plant in Zubaidiya; the upgrade of 40 gas turbines with upstream cooling systems; and the installation of 13 of 132 kilovolt substations along with 34 transformers across Iraq.

The ‘Siemens Roadmap for the Electrification of the New Iraq’ is a series of short, medium and long-term plans designed to meet the reconstruction goals of Iraq and support the country’s economic development. Along with the electrification scope, Siemens had also committed to the donation of a smart health clinic, a 60 million US-dollar software grant for universities of Iraq, and the training of more than 1,000 Iraqis in vocational education.

The clinic will be equipped with the company’s medical devices to make healthcare more accessible to Iraqis and will support the rehabilitation of populations in liberated areas of the country, with the capacity to treat up to 10,000 patients per year. As for the grant, it will empower local university students with the digital skills essential for the future.

The economic viability of the plan is secured by billions of US dollars in potential fuel savings and revenue generation for the electricity sector. The company also envisions the creation of tens of thousands of jobs over the course of the projects. The roadmap focuses on energy, education, compliance and financing, aiming to advance sustainable economic development, national security and quality of life for the people of Iraq. Siemens initially presented the Roadmap to the Government of Iraq during the Iraq Reconstruction Conference in Kuwait, in February 2018.

Kaeser commented:

“Our mission is to secure reliable and affordable electricity for the Iraqi people and help them rebuild their country. This binding agreement addresses the various aspects of the roadmap. We are also committed to supporting Iraq in arranging financing for the projects, creating attractive jobs and opportunities for small and medium enterprises.

"Investing in the country’s future workforce through education and training is close to our heart. Contributing to social and economic development is at the core of what we do and forms a significant part of this agreement.”

(Source: Siemens)

Finnish technology group Wärtsilä has said it will supply the equipment to enable an efficient, reliable, and independent power source for an Iraqi cement producing plant.

The 20 MW engine power plant is being built by Al Shumookh Lucky Investments Ltd, a JV company of Lucky Cement Limited and a limited liability company registered in the United Arab Emirates. The power plant will serve the Najmat Al-Samawa cement factory in Iraq. The order with Wärtsilä was booked in Q1, 2019.

Wärtsilä has a long-established relationship with Lucky Cement Limited, one of Pakistan’s leading cement producers and exporters. The company has earlier built two power plants for Pakistan and one power plant for Iraq based on Wärtsilä Smart Power Generation technology.

Intisar Haqqi of Lucky Cement commented:

“It is important that large cement producers operate with maximum efficiency to reduce their operating costs. For this a reliable and price predictable supply of electricity, independent from the grid, is essential. We have always had excellent support from Wärtsilä, and their power generating technology provides the certainty of supply that is needed.”

Pierpaolo Mazza, Regional Director, Wärtsilä Energy Business, added:

“There is no greater endorsement of customer satisfaction than repeat orders. This is the seventh order received from Lucky Cement Limited, which indicates the success of Wärtsilä’s engine power plants in meeting our customers’ expectations, regardless of extreme climatic conditions.”

The power plant will operate on two Wärtsilä 32 engines running on locally available heavy fuel oil (HFO) with diesel as a back-up fuel. The engine is designed to deliver outstanding efficiency with reduced fuel and water consumption in hot temperatures.

The equipment is scheduled for delivery towards the end of 2019, and the plant is expected to become fully operational during the third quarter of 2020.

Image caption: From left to right: Arif Akram, Wärtsilä Energy Business; Muhammad Qasim Latif, Wärtsilä Energy Business; Pierpaolo Mazza, Wärtsilä Energy Business; Adnan Ahmed and Najam ul Hassan, Al Shumookh Lucky Investments Ltd

(Source: Wärtsilä)

New IEA report provides practical roadmap to address Iraq’s current electricity shortfall and future energy needs

Iraq, one of the world's biggest energy producers, can address its current electricity shortfall and growing power needs through immediate action to relieve pressure on the system, according to an in-depth report published Thursday by the International Energy Agency (IEA).

It also provides a medium-term strategy that makes the best use of the country’s abundant oil and natural gas resources and solar potential.

Despite the extraordinary challenges of war in recent years, Iraq has made impressive gains, nearly doubling the country’s oil production over the past decade. But the turmoil has also undermined the country’s ability to maintain and invest in its power infrastructure.

The new IEA report, Iraq’s Energy Sector: A Roadmap to a Brighter Future, maps out immediate practical actions and medium-term measures to tackle the most pressing problems in Iraq’s electricity sector.

The analysis finds Iraq has huge potential to cut its electricity network losses, which are among the highest in the world. Reducing these losses by half would help dramatically improve the efficiency of grid supply, effectively increasing available capacity by one-third.

The report also takes a detailed look at the country’s oil and gas sector. It projects that Iraq’s oil production will grow by 1.3 million barrels a day by 2030, accounting for the third-largest increase globally over the period, and soon becoming the world’s fourth-largest oil producer behind the United States, Saudi Arabia and Russia.

The report also notes that more gas can be captured and put to use in efficient power plants. Today, 16 billion cubic meters of gas are flared each year, more than enough to replace Iraq’s current imports.

Dr Fatih Birol, the IEA’s Executive Director met, with Iraqi President Barham Salih on Wednesday in Baghdad, and presented the study’s findings and recommendations. He then met with Prime Minister Adil Abdul-Mahdi to discuss ways forward for the electricity sector, including making best use of Iraq’s significant natural gas and solar resources.

On Thursday, Dr Birol will discuss the report at a press conference with Thamir Ghadhban, the Deputy Prime Minister for Energy and Minister of Oil, and Luay Al-Khatteeb, the Minister of Electricity.

The IEA has worked closely with the Iraqi Ministries of Oil and Electricity to produce the report, and would like to thank the ministers and their staff for their cooperation with this study.

“Operating under extremely challenging circumstances, Iraq has done a remarkable job expanding its oil industry,” said Dr Birol. “Today’s urgent issue is to address the national power sector as the summer heatwave approaches by improving grid maintenance, boosting electricity production with larger mobile generators, and incentivising upgrades of power plants. The IEA is pleased to recommend immediate practical actions for the benefit of the entire Iraqi people, and provide a roadmap for a sustainable power system in the medium term.”

Iraq’s electricity demand is set to double between now and 2030, and its shortfall in electricity supply will widen, as the country’s population grows by more than 1 million people each year.

Without changes to the current structure of electricity supply and improvements to the network, domestic generation, imports and neighbourhood generation would need to double by 2030, for a total supply of over 250 TWh. However, there are many opportunities to improve on this outcome through measures such as investing in transmission and distribution to cut network losses.

Promoting the more efficient use of electricity, including by introducing more progressive tariffs, would play an important role in ensuring that the growth in demand during the summer peak does not continue to outpace supply.

Iraq also needs to take advantage of its abundant renewable energy potential.  The analysis shows that expanding the share of solar PV and wind to 30% of electricity supply by 2030 would bring benefits both to the Iraqi consumer, in the form of reduced electricity bills, and to the environment.

Reducing network losses and moving towards an electricity mix where renewables play a more prominent role would free up 9 billion cubic meters of gas for other uses in 2030, plus 450 kb/d of oil for export.

“In addition to oil, Iraq is blessed with some of the richest solar and gas resources in the world but it is yet to take advantage of them,” Dr Birol said. “Turning that potential into fuel for its own economy and for export would help bring about a more sustainable, reliable and affordable energy future.”

The report is the second in-depth study of Iraq’s energy sector following the publication of the Iraq Energy Outlook in 2012.

(Source: IEA)

By John Lee.

Foreign Minister Mr. Mohamad A. Alhakim Head of the Iraqi side and Russian Deputy Prime Minister Mr. Yury Borisov Head of the Russian side, signed the joint meeting minutes of the eighth session of the joint Iraqi-Russian committee.

They agreed to develop and enhance mutual cooperation in various productive and service sectors, as well as taking all measures to remove obstacles that face trade and investment between the two countries, and identify the mechanism by which bilateral cooperation is activated.

The meeting resulted in the signing of several agreements and memorandums of understanding in various fields, including trade, finance and banking, energy, electricity, mineral wealth, industry, telecommunications, information technology, transportation, agriculture, reconstruction, housing, health, sports, culture and tourism, education and cooperation in other areas.

(Source: Iraqi Ministry of Foreign Affairs)

UK International Trade Secretary Dr Liam Fox MP has visited Baghdad for a three-day visit (Sunday, 14 April to Tuesday, 16 April 2019) where he met with the Iraqi Prime Minister and announced that UK Export Finance (UKEF) will make an additional £1 billion of support available for British firms operating in Iraq, providing jobs and promoting stability in the region.

In the first visit to Iraq by a cabinet minister for more than a year, Dr Fox will be meeting with senior Iraqis including the Prime Minister and President to discuss the bilateral trading relationship.

Alongside the Iraqi Prime Minister Adil Abdul Mehdi, the Trade Secretary announced that UK Export Finance is making an additional £1 billion available to support UK exports to Iraq, bringing its total support for the country to £2 billion.

The measure is designed to promote Iraq’s economic development and nation-building, ensuring that UKEF can continue to help the Government of Iraq deliver critical infrastructure.

To date, UKEF has deployed its existing capacity for Iraq, providing around £1 billion in support for projects including:

• A US$35 million (£26 million) loan for the scoping phase of a water and wastewater treatment project in the Kurdistan Region of Iraq provided by UK company Biwater
• US$1.02 billion (£770 million) to support Enka UK and GE to build 2 new gas-fired power stations in the Basra region and UK-based GE Grid Solutions to build and refurbish 14 electricity sub-stations across Iraq
• support for a €30.2 million (£26 million) Siemens UK contract to refurbish the 320-megawatt Al Mussaib power station in southern Iraq
• a loan to support a US$220 million (£169 million) contract being undertaken by a UK subsidiary of GE to refurbish gas-fired power stations

This support is available to UK companies selling to Iraq or investing in the country and will help the Government of Iraq access finance for projects that source goods and services from the UK.

The International Trade Secretary Dr Liam Fox MP said:

"The atmosphere in Baghdad is one of optimism – it is a country which is having an increasingly stable period at a time of significant unrest in the wider region. The British government, working closely with the UK private sector and our Iraqi partners, have a key role to play in the country’s long-term prosperity. The £1 billion we have announced today will significantly strengthen our ability to do just that.

"Iraq’s future is bright, and my international economic department will continue to work tirelessly to ensure it maintains this stability, allowing the hard work of its talented citizens to flourish for the benefit of all.

"Trade is about more than economic self-interest, it is the means through which we deliver the mutual prosperity that underpins our collective security. That is the true prize of trade policy and promotion done right."

During the visit, the Trade Secretary will speak to young Iraqi entrepreneurs who are working to create a more vibrant private sector to support the long-term stabilisation and prosperity of Iraq. He will also meet British firms operating in-country whose investments are vital in the country’s rebuilding efforts.

Siemens UK is improving the electricity supply in Iraq using UKEF finance. Steve Scrimshaw, Country Lead, Gas and Power UK and Ireland, Siemens UK, said:

"We are delighted this additional funding has been made available for ongoing regeneration in Iraq and look forward to working with UKEF and the Iraqi government on future opportunities.

"Siemens has already benefited from UKEF support for work on the refurbishment of the Al Mussaib power plant. This will be vital for the people of Iraq who will benefit from both the power and the jobs it will create. With work being delivered from our Newcastle business, it is also helping to secure jobs in the UK."

(Source: UK FCO)

U.S. Government to Provide Additional $100 Million for Iraq Stabilization

US Chargé d’Affaires Joey Hood has announced that the United States Government intends to provide an additional $100 million to help stabilize liberated areas once held by the Islamic State.

The United States Agency for International Development (USAID) will provide the funds to the United Nations Development Program (UNDP).  With this $100 million contribution, the U.S. Government will have provided $358 million to stabilization efforts in Iraq since 2015.

The Funding Facility for Stabilization is supported by the Global Coalition to Defeat ISIS and managed in cooperation with the Government of Iraq.

The United States and the GOI are committed to creating the conditions to allow displaced Iraqis to return to their homes and start to rebuild their lives.  Strengthened with new funding, this stabilization program will restore essential services, such as water, electricity, sewage, health, housing, and education.

In his announcement, the Chargé called on Anbar’s elected officials, tribal sheikhs, and residents to protect the project work sites and ‎do their part to re-integrate back into their communities all displaced Iraqis who wished to return home.

(Source: U.S. Embassy Baghdad)

By John Lee.

The Kurdistan Regional Government (KRG) has issued a report on its "Priority Humanitarian Small Scale Projects: In Health, Education, Municipality, Electricity, Social Care, Agriculture and Livelihoods and Water Sectors Kurdistan Region-Iraq 2019".

The document presents a detailed breakdown of a total 167 priority humanitarian Small Scale Projects (SMPs) for 2019.

The focus is therefore on small-scale projects with the cost per project ranging from USD 28,000 to 1.2 million.

Download the full 39-page report here.

(Source: KRG)