Posted on August 11, 2016 by Editorial Staff in Economy, Electricity
Photo credit: Tsilimited.com
HEWLÊR-Erbil, Iraq’s Kurdistan region,— The Kurdish ministry of electricity in Iraq’s Kurdistan region is planning to partly privatise its fragile electricity sector following rapid population growth and overuse of electric power in Kurdish urban areas.
Iraqi Kurdistan still suffers from electric power deficiency almost 25 years of semi autonomy.
Two international consulting firms have been hired by the ministry in cooperation with the World Bank to help the Region in both distribution and usage of electricity, the ministry’s spokesperson Muhammad Amin Hawraman said.
In April International Finance Corporation (IFC), the World Bank’s private sector investment arm, said it had arranged $375 million in financing for an Iraqi power company to provide electricity to millions of people in Kurdistan and Baghdad. The company, Mass Global Energy Sulaimani, will use the funds to add 500 megawatts of capacity to a 1,000-megawatt power plant in Kurdistan, providing power to 3 million people.
“These two firms’ reports will be available by October after which we will implement their recommendations and then ask the interested private companies to come with their offers for management of electricity,” Hawraman told Rudaw.
The ministry says so far no contracts have been signed with any companies but only domestic firms “with sufficient experience and means” will be qualified to submit their applications.
Hawramani said the private companies will have both the distribution and charging rights but will operate under government regulations to hold the prices “reasonable.”
With the steady growth of population from an estimated 3.8 million in 2003 to 5.5 in 2015, and with nearly 1.8 million refugees in the Kurdish territories, distributing the needed electricity has been a great challenge for the Kurdistan Regional Government (KRG) to wrestle with.
The major power plants in the region, which are giant gasoline-driven generators and a number of water dams, produce some 2,800 megawatts of electricity, which are then distributed in the three provinces of Sulaimani, Erbil and Dohuk.
The ministry has said it will need around 5,000 megawatts to cope with the pressure since it also provides Kirkuk with some of its power.
Both Mosul and Kirkuk provinces receive the majority of their electricity from the Mosul dam, which has been under Peshmerga control since 2014.
Currently, the Kurdistan Region enjoys between 18 to 20 hours of electricity daily while it does not have the administrative means to charge consumers for overuse.
In April Iran has cut electricity to the Penjwen district east of Sulaimani as well as to neighboring villages since Monday after the Kurdistan Regional Government (KRG) failed to pay $27 million USD to Iran, an official said on April 5.
The situation in the rest of Iraq is even more challenging with cities like Baghdad and Karbala often provided with less than 10 hours of electricity daily.
The board of investors in Kurdistan has called on the KRG to fully privatize the ministry of electricity and allow people to own shares, which the board has said could effectively solve the shortage.
Iraqi Kurdistan Region’s Ministry of Natural Resources Ashti Hawrami, who is routinely accused ofcorruption, takes charges of the electricity ministry last January following the resignation of Salahaddin Babakir.