Iraq’s energy sector is under increasing strain, with electricity shortages becoming a critical issue. Despite recent improvements in economic growth and security, the country’s energy infrastructure is struggling to keep up with rapidly rising demand. Baghdad faces a challenging situation as it approaches another summer, potentially leading to widespread power shortages and unrest.
Iraq’s electricity generation capacity has not kept pace with growing demand, driven by a rising population, urbanization, and the increasing use of air conditioning and appliances. While Iraq’s peak electricity demand reached 48 gigawatts (GW) last year, the country can only generate about 27GW. To meet this gap, Iraq has relied heavily on imports from Iran, but these supplies have become unreliable due to Iran’s own power shortages and rising domestic demand. Additionally, U.S. sanctions on Iran complicate this arrangement, as the U.S. has been pressing Iraq to reduce its reliance on Iranian gas and electricity imports.
Despite these challenges, Iraq has made efforts to diversify its energy sources. It has signed agreements with Turkey, Jordan, and Turkmenistan for additional gas imports, though logistical and political challenges make these solutions less reliable. Moreover, Iraq is working on developing liquefied natural gas (LNG) terminals and capturing flared gas from oil operations in the south, with companies like Shell, TotalEnergies, and BP leading projects in this area.
However, these measures may not be sufficient to address the energy shortfalls expected this summer. The country’s energy future depends on more substantial investments in renewable energy, particularly solar power. Iraq has been slow to develop large-scale solar projects, but with the support of the GCC and international partnerships, it could quickly ramp up production and help meet summer daytime needs.
The GCC countries—UAE, Saudi Arabia, Kuwait, and Qatar—have shown interest in partnering with Iraq on energy projects, but the country’s bureaucracy and political complexities have delayed progress. The recent efforts to link Iraq’s electricity grid to the GCC grid via Kuwait could offer some relief, but a more ambitious approach is needed. Increasing the transfer capacity from neighboring countries and boosting solar energy initiatives within Iraq would be key steps toward stabilizing the power supply.
The situation is urgent: if Iraq does not act swiftly to address its energy challenges, it could face not only economic setbacks but also significant political instability as power shortages increase discontent among the population. The GCC could play a pivotal role in helping Iraq build a sustainable energy infrastructure, potentially leading to stronger regional cooperation and stability.
