Click on image for larger view
Electricity consumption has seen a huge increase since 2003, but supply has not kept up with demand. After the invasion, Iraqis were freed from sanctions, flooded with cheap consumer goods, and their buying power began to increase. These all led to greater power usage. The U.S. and Iraqi governments also pumped billions into the power sector to boost output. The problem was that both went up at just about the same rate. In the first three months of 2010 electricity output rose to 5,635 megawatts or 135,230 megawatt hours per day.That was a 7% increase from the last quarter of 2009, but supply still only met an estimated 71% of demand however.
The new plan by the Electricity Ministry is unlikely to work. Prices for power are still relatively cheap. More importantly, according to the Special Inspector General for Iraq Reconstruction, most Iraqis don’t pay their electricity bills because they don’t get a steady supply. Many Iraqis still only get a few hours of power a day. Supply is especially bad in rural areas, and outside the major cities. Therefore it doesn’t really matter what the government charges, as long as they don’t provide 24 hours of power a day, the majority of the population is probably unwilling to pay anything for the service.
Kami, Aseel, “Iraqi electricity bills jump in power saving move,” Reuters, 6/1/10
Special Inspector General for Iraq Reconstruction, “Quarterly Report to the United States Congress,” 4/30/10