Iraq hit by severe power shortages as Iran cuts gas supplies

Opec’s second-biggest oil producer depends on Iran for approximately a third of its electricity needs

Switches to transfer electricity to private homes in Baghdad. AP

Iran has reduced gas supplies to Iraq due to unpaid bills, causing widespread electricity shortages in the centre and south of the country, a government spokesman said on Tuesday.

Iraqi Electricity Ministry spokesman Ahmed Moussa told The National that gas supplies from Iran had dropped to around 8.5 million cubic metres a day from 50 million.

That reduction has led the national power system to lose around 4,000 megawatts, leaving total production hovering around 13,000 megawatts, Mr Moussa added.

Iraq’s daily production topped around 21,000 megawatts in summer, he said, while demand in the country is about 35,000 megawatts.

What has exacerbated the situation during peak winter demand, he said, is maintenance required for some power stations before the hot summer months.

“The reduction in gas supplies started more than two months ago, but we didn’t feel it that much because the weather was mild,” he said.

“There has been a contact between the Ministry of Electricity and Iran’s Energy Ministry to settle the payment issue,” he said, adding that Iraq owes Iran billions of dollars in unpaid energy bills. He did not divulge the exact amount.

Despite billions of dollars spent since the 2003 US-led invasion that toppled Saddam Hussein, many Iraqi cities and town are still experiencing severe power cuts and rolling blackouts.

The country’s chronic power crisis has fuelled protests, mainly during the summer when temperatures hit 50°C and above.

Iraq has spent at least $60 billion on the electricity sector since 2003, the country’s Prime Minister Mustafa Al Kadhimi told reporters in late 2020. Aside from money lost to corruption, much has been misallocated.

Despite being Opec’s second-biggest producer, Iraq depends on Iran for approximately one third of its electricity needs.

Baghdad has been under pressure from Washington to wean itself off Iranian energy imports, which have been subject to US sanctions since 2018.

Since then, Washington has repeatedly extended a waiver to Baghdad for periods of between 45 to 120 days.

Iraq has taken some steps to develop its natural gas resources and electricity sector in recent years.

It has signed multi-billion-dollar agreements with multinational energy services companies such as the US's GE and Germany's Siemens to improve its power infrastructure — damaged by decades of war, sanctions and corruption — and to start clean energy projects.

It is in talks with Gulf states and Jordan to import electricity, but these discussions have yet to result in permanent deals.