Iraq’s needless energy crisis is risking lives

The country is struggling to power homes, despite sitting on vast energy reserves
A general a view of the Rumaila oil field in Basra, Iraq, November 28, 2017.  Picture taken November 28, 2017.  REUTERS/Essam Al-Sudani

If there is one thing that should be reliable in Iraq, it is the energy supply. The country produces the second-highest amount of crude oil among Opec member states, and holds an estimated 145 billion barrels in proven reserves, equivalent to eight per cent of the world's total supply.

Nonetheless, over the past two decades, Iraqis have had to live with some of the most unstable electricity in the Middle East. It is not only a major impediment to economic development and societal advancement in the long term, but also a cause for short-term instability. Demonstrators in the mass protest movement that has swept the country since 2019 often point to power outages as a sign of the corruption endemic in Iraqi politics. On Tuesday, after a new round of nation-wide shortages that saw blackouts in the south and patchy supply across the rest of Iraq, the electricity minister, Majed Mahdi Hantoosh, tendered his resignation.

Analysts suggest that Iraq can produce a maximum of 17 gigawatts of power – when the system is running in perfect order, that is. But that figure falls way below peak summer demand, which can rise above 29GW. And by the end of the decade, Iraq will need to meet what is expected to be an increase in demand of 50 per cent.

Mr Hantoosh’s position was always a difficult one. The country's energy infrastructure has been plagued by war, mismanagement and corruption, and has proven hard to reform in a government that is paralysed by partisan politics. Furthermore, the racketeering of private generator providers has been woven into the world of organised crime. Armed groups often launch sabotage attacks to disrupt power supplies.

But amid this challenging environment, there have also been a series of poor policy decisions. A particularly controversial one in recent times is the pursuit of a hugely ambitious nuclear energy programme. Estimated to cost $40bn, the plan would involve building eight reactors. It is as costly as it is unnecessary; the ever-expanding gap between supply and demand could be narrowed by investing in existing and dilapidated energy infrastructure. And even if the nuclear plan was seen through to completion, it would still not generate enough to meet future needs.

Nonetheless, there is some wisdom in attempting to diversify an energy sector that still relies overwhelmingly on oil, even if the answer is not quite so glamorous. Iraq sits on vast natural gas reserves that remain largely untapped. The World Bank's International Finance Corporation has recently announced it will provide more than $300 million to Basrah Gas Company, injecting momentum into a sector with huge potential to address the country's energy needs. Iraq could also follow the example of Gulf states, who are investing heavily in renewables, including solar power. Last week, Iraq signed an agreement with Masdar to establish a solar energy project in the central and southern regions of the country, which could play an instrumental role in helping meet Iraq’s energy needs, and brand it an example of sustainability in the region.

A huge part of the frustration within Iraq is that the potential of this promising future is no secret. Political reshuffling and wrangling between powerful factions seems inexcusable when many Iraqis are unable to power air conditioning units as temperatures soar, this week reaching as high as 50°C. While the ministerial resignation indicates a sense of responsibility, it is not nearly enough to tackle the huge challenge posed by the state of the country's energy sector.

Published: July 1st 2021, 5:10 AM