Monday, November 24, 2008

Baghdad’s Electricity Plan

In mid-November Prime Minister Nouri al-Maliki announced a plan to boost Iraq’s electricity production to meet demand by 2012. That would require tripling current generation at the minimum, and could cost up to $5.5 billion if not more. Currently, Iraq produces 113,141 megawatts, an 8% increase from the previous year, but demand is almost double that at 207,377 megawatts, up 7% from last year. Delivery of power is also inconsistent. From January to August 2008 Iraq averaged 12 hours a day of electricity, but most of that goes to government or public facilities. An average house may only receive six hours of daily power. Only 34% of Iraqis say they get the amount of power they need in a September 2008 survey, which was a decrease from an earlier poll this year.

The United States has already spent $4.65 billion on the electricity industry, while Iraq has appropriated $1.3 billion. That has added 550 new projects, and 2,500 megawatts to the system, but it has not been enough. Since the invasion Iraqis have gone on a spending spree with consumer appliances that has increased demand greatly.

In September the government signed contracts with General Electric (GE) and Siemens to boost electrical production. The GE deal is to boost output by 6,800 megawatts, and the Siemens’ one is to add 2,000 megawatts. There are negotiations with a third company to produce an additional 1,000 megawatts. Baghdad is talking to Russian companies as well to repair existing power plants. Iraq has also cut extensive deals with Iran to provide electricity. They now provide 2/3 of Iraq’s power imports.

One major question about this plan is if Iraq can handle all of these new projects on its own. North of Baghdad companies are finishing work on the Al-Quds power plant. It is the last major project the U.S. is funding in the country. When completed it will provide electricity to 180,000 households in central Iraq. Next to Al-Quds is an abandoned plant with brand new turbines. The equipment cost $20 million, but broke a few months ago because the Iraqis could not fix it. The plant may never work again. The capabilities of Iraqis have been a major problem, especially with a huge brain drain of professionals, which leads to poor maintenance and breakdowns. Iraq also lacks an integrated power plan. Electricity plants rely on oil for fuel, but there is no coordination with the Oil Industry to provide it. These could cripple Maliki’s power plan.

Electricity Statistics

Electricity Ministry Spending
2005 total spent $147 million, $5 million operational, $142 million capital
2006 total spent $281 million, $13 million operational, $268 million capital
2007 total spent $78 million, $77 million operational, $1 million capital
January to April 2008 spent $15.2 million, $15 million operational, $200,000 capital
Annual Average Growth Rate 2005-2007 in Iraqi dinars: 33% decline in total spending, 277% increase in operational spending, 93% decline in capital spending

Electricity Ministry’s Budget and Spending 2008
2008 Appropriated $1.3 billion
Spent $229 million as of June 2008, 17.6%

August to October 2008 Iraq reached its peak average daily output 4,919 megawatts, which equaled pre-war production

Provinces: Supply and Demand From Most To Least
Basra: Supply 15,576 megawatts/Demand 20,966 megawatts – 74% met
Dhi Qar: Supply 6,030 megawatts/Demand 9,215 megawatts – 65% met
Anbar: Supply 4,728 megawatts/Demand 7,488 megawatts – 63% met
Diyala: Supply 3,256 megawatts/Demand 5,299 megawatts – 61% met
Kurdistan (Dohuk, Irbil, Sulaymaniya): Supply 12,725 megawatts/Demand 20,746 megawatts – 61% met
Salahaddin: Supply 5,359 megawatts/Demand 8,754 megawatts – 61% met
Tamim: Supply 4,291 megawatts/Demand 7,373 megawatts – 58% met
Muthanna: Supply 2,380 megawatts/Demand 4,610 megawatts – 51% met
Ninewa: Supply 9,751 megawatts/Demand 19,359 megawatts – 50% met
Qadisiyah: Supply 2,925 megawatts/Demand 5,760 megawatts – 50% met
Karbala: Supply 3,035 megawatts/Demand 6,222 megawatts – 48% met
Baghdad: Supply 28,863 megawatts/Demand 60,246 megawatts – 47% met
Najaf: Supply 3,999 megawatts/Demand 8,525 megawatts – 46%
Babil: Supply 4,378 megawatts/Demand 9,678 megawatts – 45% met
Maysan: Supply 2,747 megawatts/Demand 6,222 megawatts – 44% met
Wasit: Supply 3,089 megawatts/Demand 6,914 megawatts – 44% met
Iraq: Supply 113,141 megawatts/Demand 207,377 megawatts – 55% met

SOURCES

Aswat al-Iraq, “15 daily hours of power by mid next year – PM,” 11/14/08

Azzaman, “Electricity Ministry accused of doctoring power output figures,” 8/28/08

Department of Defense, “Measuring Stability and Security in Iraq,” September 2008

Iraq Directory, “The Minister of Electricity: Iraq needs 11 MW of power energy,” 10/7/08

Ketz, Sammy, “Iraq power generation finally hits pre-invasion levels,” Agence France Presse, 8/25/08

Ryan, Missy and Qusay, Aws, “Iraqis Measure Progress with Flip of Switch,” Reuters, 11/14/08

Special Inspector General for Iraq Reconstruction, “Quarterly report to the United States Congress,” 10/30/08

United States Government Accountability Office, “Iraqi Revenues, Expenditures, and Surplus,” August 2008

Webb, Simon, “Iraq signs billion-dollar power deals with GE, Siemens,” Reuters, 9/28/08

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