Options to Building Power Plants in Iraq

Options to Building  Power Plants in Iraq
Options to Building  Power Plants in Iraq

Construction of power plants in Iraq by Iranian engineering companies is in line with the policies of Iran's Ministry of Energy for exporting technical and engineering services to neighboring countries to gradually transform Iran into the region's energy hub. But private sector managers say Tehran would do better by exporting electricity to the Arab country and with the export earnings buy or build plants in countries with sufficient proven gas reserves instead of supplying gas to Iraq's power stations.

Business and industry leaders insist construction of power stations in war-torn Iraq is not economically viable. Making their point, they mention the Al-Sadr gas power plant built by Iranian companies near Baghdad that is fed by the gas supplied from Iran. Board member and secretary general of the Federation for Export of Energy and Related Industries, Hamidreza Salehi suggested in an interview with the Persian economic daily Forsat-e-Emruz that instead of building more power plants in Iraq, Iran should establish power stations in the south of the country so that the huge gas reserves are utilized domestically. "Electricity generated from the new plants could then be exported not only to Iraq, but also Oman and other neighboring countries."  

 He further proposed construction of power stations in countries such as Turkmenistan which have large gas reserves, as a workable strategy to reduce inflation and boost revenues. He believes for Iran to achieve its goal of emerging as an energy hub in the strategic oil-rich region, it is necessary to expand Iran's electricity transmission networks and further expand links between the eastern and western flanks of the country.

  Massive Power Shortages

Late last month the Iraqi Parliament's Oil and Energy Committee published a report drafted by the advisory board of the prime minister's office, which indicated that Iraq is losing around $40 billion annually due to the lingering power outage crisis. The report was carried by the local and international media. It confirmed that the continuous power outages caused serious damage to petrochemical plants and private plants. It is worth mentioning that for years now power outages in Iraq have shot up from 15 to 20 hours per day throughout the year, with the exception of the Kurdistan Region of Iraq, where the private sector participates in electricity generation and distribution.

Iran sells technical and engineering services to more than 20 countries, with the water and electricity sectors generating almost 60% of their revenues through the export services

Contrary to the views of private enterprise, the deputy minister for planning and economic affairs at the ministry of energy, Alireza Daemi says the decision to export technical and engineering services to Iraq is based on Tehran's declared policy of "empowering Iraq and strengthening bonds with the country, "and that decisions to build power stations in other countries are taken after "socioeconomic feasibility studies."

"Western countries have normally tried to obstruct the progress and advancement of developing countries", he said, adding that it would not be "fair" for Iran to push for self-sufficiency in building power stations while its neighbors remain weak and lack the infrastructure for generating much-needed electricity.

Another power plant was recently inaugurated by Iran's energy minister in Iraq's holy city of Najaf. The 162 MW unit was constructed by Iran's prominent Mapna construction group and funded by charities and donations from Iranian philanthropists, the deputy minister said.