Energy
The energy file in Iraq is not solely an oil file; it is a comprehensive sovereign infrastructure file encompassing electricity, gas, renewables, and refining. The objective is operational self-sufficiency and maximisation of added value.
Introduction
Iraq holds the world's fifth-largest oil reserves and fourth-largest gas reserves, yet it imports refined products and suffers from chronic electricity deficits. This file proposes re-engineering the energy sector from upstream to final consumption, with a gradual transition toward a balanced energy mix.
Key Challenges
- National income dependence on crude oil exports rather than higher-value refined products.
- Flaring of associated gas in volumes exceeding domestic utilisation.
- Gap between installed and actually generated electricity capacity, compounded by high transmission and distribution losses.
- Slow development of renewable energy despite high solar irradiance.
- Weakness of electricity grid interconnection between the Kurdistan Region and other governorates.
Vision
An integrated Iraqi energy system that achieves domestic electricity self-sufficiency, maximises the value of hydrocarbon resources through refining and petrochemicals, and integrates solar energy at a share exceeding 25% of the energy mix within a decade, within a unified smart grid.
Action Axes
Maximising Added Value
Constructing modern refineries and petrochemical complexes that convert crude oil and gas into final value-added products, rather than exporting them at world market commodity prices.
Electricity Efficiency
Reforming transmission and distribution networks, reducing losses, developing operational performance metrics, and restructuring tariffs in a manner that incentivises conservation without burdening vulnerable groups.
Renewable Transition
Launching a national solar energy programme targeting public institutions first, while encouraging residential installation through tax incentives and concessional loans.
Regional Interconnection
Developing electricity interconnection networks with neighbouring countries to improve operational stability, and securing strategic gas imports during the transitional period.