The MoE is embracing the importance of actively inviting private sector investment into traditionally state run activities. Over the coming decade, the MoE’s General Plan identifies 24,000 MW of generation projects, along with a range of transmission and distribution initiatives. The Ministry has also identified some fuel related projects like the construction of methane gas gathering, treatment, and delivery facilities.
Investment by the private sector is essential in order to meet the demand of Iraq’s constituents in the near and long term, to balance supply and demand and to meet levels of reliability desirable for sustained economic growth and a modern quality of life.
In the past year, Iraq has entered into contractual arrangements with GE and Siemens for 10,840 MW of new generation equipment, with financial commitments of about $5B USD. These contracts provide only for the delivery of the core generating equipment, such as turbines and generators, and do not account for balance of plant construction, related fuel facilities, commissioning, and transmission expansion. The Government of Iraq anticipates that about $7B USD in additional investment is needed, and is looking to the private sector to actively participate in the long term investment in the sector. This balance of plant equipment offers huge potential for international equipment suppliers.
The MoE has considered several different models for international investors to enter Iraq's electricity sector and is actively exploring these options. The MoE recently executed a contract with an international consulting firm to develop a model solicitation for development of a privately-owned power station that would sell its output to the MoE. This demonstrates an unprecedented and formal commitment to attracting private investment in the sector.