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Electricity

Even six years after the “liberation”, Iraq is still struggling with problems concerning the supply of electricity. Multiple factors give rise to this undersupply which meant merely a couple available hours per day in Baghdad during the summer of 2009. Supply has been significantly impacted by underinvestment in the sector resulting from: the volatile security situation, widespread financial problems, increased demand from private air-conditioning equipment, the continuing two-year drought and the associated power plant shutdown due to water deficiency, as well as acts of sabotage on power grids and distribution networks.

The Ministry for Electricity does not publish production statistics on its website for good reason. In 2007, US armed forces discontinued their statistics of hours per day of electricity supply. In the summer of 2009, this situation led to Iraqi demonstrations for the improved electricity supply which forced the Ministry for Electricity to comment.

The supply problem is anticipated to be confronted with a massive investment program. The Ministry for Electricity, more specifically the General Directorate for Gas Power Plants Projects (www.gppproject.com), has prompted interested businesses to submit qualification information for planned gas turbine power stations. Contracts for the corresponding turbine deliveries have been signed by General Electric and Siemens. However, issues with funding have delayed the implementation thus far. According to the Ministry for Electricity, General Electric will represent 7,200 MW whereas Siemens turbines are planned to deliver 3,000 MW.

According to the Ministry, funds of USD 5 bn are available for such investments over the course of the next four years. Funding is available for additions to capacity, the development and rehabilitation of power grids and distribution networks, as well as control modules and equipment. Despite these investments, and against the background of lower crude oil prices than in 2008, funds remain scarce.

The Ministry of Electricity reported that at the end of 2009, electricity demand was approximately 12,000 MW, while only 7,000 MW was available on the grid. The shutdown of steam turbine power plants due to water shortages lead to a deficit of 2,000 MW, while lack of fuels, especially of gas, resulted in deficiencies of 1,000 MW. Predictions regarding continuing water shortages are a substantial reason for the planned large-scale expansion of gas turbine capacities.
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