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The Untapped Potential: Solar Energy in Iraq

Iraq, a nation blessed with vast hydrocarbon resources, paradoxically grapples with severe and persistent electricity shortages. This critical deficit is a complex issue stemming from a confluence of factors, including decades of underinvestment leading to dilapidated and aging infrastructure, rapid population growth that continuously outpaces supply, and the intensifying impacts of climate change, which place additional strain on energy systems.

In this challenging energy landscape, solar power emerges as a highly promising and potentially transformative solution. Iraq possesses exceptionally high levels of solar irradiation throughout much of the year, making it an ideal candidate for widespread solar energy deployment.

Harnessing this abundant natural resource could significantly alleviate the nation's power crisis and pave the way for a more stable and sustainable energy future.

This article aims to provide a comprehensive and in-depth exploration of Iraq's burgeoning solar energy potential. It will delve into the current state of solar energy utilization within the country, highlighting both successes and limitations.

Furthermore, it will meticulously examine the formidable challenges that impede the widespread adoption of solar power, ranging from technical and financial hurdles to regulatory and security concerns.

Crucially, the analysis will identify and discuss the key stakeholders involved in Iraq's evolving energy sector, including government entities, international organizations, private investors, and local communities.

By offering this holistic overview, the article seeks to illuminate the strategic shift towards a more sustainable energy paradigm in Iraq and the potential for solar power to play a pivotal role in this vital transition.

Solar Energy Potential and Current Utilization

Iraq possesses extraordinary solar energy potential, with some of the highest solar irradiation levels globally, making it ideal for solar energy development. Vast regions receive high solar radiation, suitable for large-scale power plants, as illustrated in solar irradiation maps.

As shown in Figure-1, the estimated photovoltaic (PV) power generation potential, calculated for a 1kW-peak grid-connected solar plant over 20 years (1999-2018), highlights this significant capacity. Despite this potential, current solar utilization is low, contributing about 40-50 MW to Iraq's approximately 30-35 GW total electricity generation capacity as of late 2023.

Figure 1 - Estimated photovoltaic (PV) power generation potential, calculated for a 1kW-peak grid-connected solar plant over 20 years (1999-2018). Source: The World Bank.

The severe unreliability of the national grid, marked by frequent outages and transmission losses (around 20-30% in recent years), drives residential and commercial adoption of solar PV systems, which offer a quick payback period due to high grid electricity costs.

Iraq has set ambitious targets, aiming for 12 GW of solar power by 2030. Several large-scale projects are underway or authorized, including a 250 MW plant slated for completion by 2025, a 300 MW project in Karbala, a 1,000 MW project in Basra, and a 750 MW project by Power China.

Additionally, contracts for 7,500 MW of solar capacity have been approved. These initiatives signal a strong commitment to integrating renewable energy and addressing the power supply gap.

Challenges and Barriers to Solar Energy Adoption

Iraq's solar energy development faces significant technical, economic, institutional, and environmental challenges. Grid instability and infrastructure deficiencies are major hurdles, with the national grid being dilapidated and suffering notable transmission losses, as illustrated in Figure-2, which shows electric power transmission and distribution losses as a percentage of output in Iraq from 1990-2021.

Economic and financial barriers include high upfront investment costs for solar systems (5-10 million Iraqi dinars), despite quick payback periods, and subsidized electricity tariffs that disincentivize private investment.

Figure 2 - Electric power transmission and distribution losses (% of output) in Iraq 1990-2021 - Source: The world bank

Institutional and regulatory issues involve a lack of clear, consistent frameworks for renewable energy, including grid connection and power purchase agreements, which deters investors. Vested interests in the fossil fuel sector also resist the transition.

Technical and environmental considerations include concerns about solar power's capacity factor (around 30%) and the impact of dust storms, which can reduce solar radiation intensity by up to 50%. Effective mitigation requires robust cleaning and resilient panel technologies. Weak public trust, stemming from decades of unreliable public services, impacts the adoption of distributed solar solutions and support for large-scale projects.

Key Actors and Stakeholders

The nascent solar energy sector in Iraq is characterized by a multifaceted network of stakeholders, each playing a crucial role in its growth and sustainability. At the forefront is the Iraqi Ministry of Electricity, serving as the primary governmental body responsible for policy formulation, regulatory frameworks, and overall strategic direction for the nation's power generation, including renewable sources.

Their involvement is critical for setting targets, allocating resources, and attracting investment into the solar energy landscape.


Beyond domestic governmental bodies, international organizations significantly contribute to the sector's development. Entities like GIZ (Deutsche Gesellschaft für Internationale Zusammenarbeit) and UNDP (United Nations Development Programme) provide vital technical assistance, capacity building, and financial support.

These organizations often facilitate knowledge transfer, support pilot projects, and help build the necessary infrastructure and expertise for solar energy deployment, frequently working on initiatives that range from policy advisory to community-level implementation.

The private sector is emerging as a key driver of growth, bringing in investment, technological innovation, and operational efficiency. This includes both local and international companies involved in the manufacturing, installation, and maintenance of solar photovoltaic (PV) systems, as well as those developing larger-scale solar power plants. Their participation is essential for scaling up projects and creating a competitive market.

Academic institutions also play a pivotal role, exemplified by the University of Sulaimani. These institutions contribute through research and development, aiming to optimize solar energy technologies for Iraq's specific climate and energy needs.

They are also crucial for educating and training a skilled workforce, including engineers, technicians, and researchers, who will be essential for the long-term sustainability and innovation of the solar energy sector. This includes curriculum development, applied research, and fostering a culture of innovation.

Finally, local communities and non-governmental organizations (NGOs) are integral to the holistic development of the solar energy sector. Their involvement often centers on raising awareness, advocating for sustainable energy solutions, and participating in grassroots projects, particularly in rural or underserved areas.

These groups can facilitate community acceptance of solar projects, identify local needs, and ensure that the benefits of solar energy are distributed equitably, often working on off-grid solutions and promoting energy independence at a local level. The synergy among these diverse actors is fundamental to unlocking Iraq's vast solar energy potential and transitioning towards a more sustainable energy future.

Global Solar Energy Case Studies: Lessons for Iraq

Examining successful solar energy implementations in other developing countries can provide valuable insights and a roadmap for Iraq's own renewable energy ambitions. These case studies demonstrate that with the right strategies, a nation can rapidly accelerate its transition to a sustainable energy future, addressing both energy demand and environmental concerns.

India's solar power revolution stands as a compelling example of what can be achieved through ambitious targets and comprehensive policy frameworks. Driven by the National Solar Mission, India implemented a range of innovative policies, including reverse auctions for solar project development, which significantly drove down costs and fostered fierce competition among developers.

Furthermore, feed-in tariffs provided long-term price certainty for electricity generated from solar, attracting substantial domestic and international investment. Capital subsidies and tax incentives further de-risked projects and encouraged early adoption.

This multi-pronged approach has led to a remarkable surge in solar capacity, transforming India into one of the world's leading solar energy producers. The success highlights the critical importance of strong governmental commitment, clear policy signals, and a diverse set of financial incentives in mobilizing the necessary investment and scaling up renewable energy infrastructure.

Beyond large-scale utility projects, India also focused on decentralized solar solutions, supporting rooftop solar installations and solar-powered agricultural pumps, further expanding the reach and impact of solar energy across various sectors.

Bangladesh's Solar Home Systems (SHS) program offers a powerful illustration of how decentralized solar solutions can effectively address rural electrification challenges in off-grid areas. Facing a significant portion of its population without access to the national grid, Bangladesh leveraged microfinance institutions and development partners to facilitate the widespread adoption of SHS.

These systems, typically consisting of a solar panel, battery, and LED lights, provided clean, reliable electricity to millions of households, improving quality of life, extending daylight hours for productive activities, and reducing reliance on traditional, often polluting, energy sources like kerosene lamps.

The program's success can be attributed to its innovative financing models, which made solar technology affordable through installment plans, and the robust network of local implementers who ensured installation, maintenance, and after-sales support.

This model showcases the transformative potential of tailoring solar solutions to specific community needs and leveraging existing financial infrastructure to overcome barriers to access. The SHS program not only delivered electricity but also spurred local economic development by creating jobs in the solar value chain and empowering communities.

Both India and Bangladesh offer invaluable lessons for Iraq. India's experience underscores the need for robust national policies, substantial financial incentives, and a commitment to large-scale grid integration to attract significant investment and achieve rapid capacity growth.

Bangladesh's success, on the other hand, highlights the effectiveness of decentralized solutions and innovative financing mechanisms for addressing specific energy access gaps, particularly in rural or remote areas.

By carefully analyzing these diverse approaches, Iraq can develop a comprehensive solar energy strategy that integrates both utility-scale projects and distributed generation, caters to different energy needs, and leverages a mix of policy, financial, and technological solutions to harness its vast solar potential.

Furthermore, these examples emphasize the importance of creating a conducive regulatory environment, fostering private sector participation, and investing in human capital to ensure the long-term sustainability and growth of the solar energy sector.

Concrete Mitigation Recommendations for Iraq

To accelerate solar energy adoption and ensure a sustainable energy future, Iraq should focus on several key recommendations.

Firstly, grid modernization is paramount. This involves upgrading the existing electricity grid to handle the intermittent nature of solar power, integrating smart grid technologies, and improving transmission and distribution infrastructure to minimize losses and enhance reliability.

Secondly, enacting comprehensive regulatory frameworks is crucial. This includes developing clear policies for renewable energy targets, standardized interconnection procedures for solar installations, net metering policies to allow consumers to sell excess solar power back to the grid, and transparent permitting processes.

A stable and predictable regulatory environment will attract investors and foster long-term growth.

Thirdly, establishing robust financial mechanisms is essential. This could involve offering attractive incentives such as tax credits, grants, and low-interest loans for solar projects. Furthermore, the government could explore feed-in tariffs, power purchase agreements (PPAs), and green bonds to de-risk investments and make solar energy more financially viable for individuals and businesses.

Public-private partnerships can also play a significant role in funding large-scale solar initiatives.

Fourthly, expanding capacity building is vital for a thriving solar industry. This encompasses investing in education and training programs to develop a skilled workforce capable of designing, installing, maintaining, and operating solar energy systems.

Vocational training centers, university programs, and international collaborations can help build local expertise.

Fifthly, launching extensive public awareness campaigns is necessary to drive demand and acceptance. These campaigns should educate the public about the benefits of solar energy, including its environmental advantages, potential cost savings, and contribution to energy independence.

Demonstrations, community outreach programs, and media initiatives can help shift public perception and encourage adoption.

Finally, investing in localized research and development (R&D) is critical for long-term sustainability and innovation. This includes supporting local universities and research institutions to develop tailored solar technologies that are well-suited to Iraq's specific climate conditions and energy needs. R&D can also focus on improving the efficiency and affordability of solar panels, developing energy storage solutions, and exploring new applications for solar power.

By focusing on these interconnected areas, Iraq can significantly accelerate its transition to a solar-powered future.

Iraq stands at a pivotal juncture in its energy evolution, grappling with persistent electricity deficits and the escalating threat of climate change. In this critical context, solar power emerges as a beacon of hope, presenting a sustainable and potent solution. 

Despite possessing an abundance of solar irradiation, Iraq's current adoption of solar energy remains remarkably low. Nevertheless, a palpable shift is underway, evidenced by the nation's ambitious renewable energy targets and a growing portfolio of ongoing solar projects, underscoring a burgeoning commitment to transitioning away from fossil fuels.

Navigating Challenges to Build a Sustainable Future

However, the path to a solar-powered future is fraught with significant hurdles. A primary obstacle is the country's aging and dilapidated electricity grid, which struggles to efficiently transmit and distribute power, let alone integrate a substantial influx of renewable energy.

Economic challenges further compound the situation, including insufficient investment in renewable infrastructure, the high upfront costs of solar technology, and the existing reliance on subsidized fossil fuels. Moreover, regulatory gaps and a lack of clear policy frameworks can deter both domestic and international investment in the nascent solar sector.

Overcoming these multifaceted challenges necessitates a concerted and sustained effort. Foremost among these is the imperative for unwavering political will to champion renewable energy initiatives and enact supportive legislation.

Substantial investment in modernizing and expanding the national grid is crucial to accommodate distributed solar generation and ensure reliable power delivery. Furthermore, fostering robust collaboration among all stakeholders – including government bodies, private sector entities, international organizations, and local communities – is vital to streamline project development, facilitate knowledge transfer, and build local capacity.

By strategically leveraging its immense solar resources and proactively addressing these systemic challenges, Iraq has the potential to forge a secure, sustainable, and prosperous energy future, mitigating its reliance on volatile fossil fuel markets and enhancing its environmental resilience.

References

• GIZ. (n.d.). Renewable energies in Iraq: Bringing experts, policy makers and private sector together to leverage the potential of solar power for a greener future. https://www.giz.de/en/worldwide/153350.html .

• International Energy Agency. (2023). Energy policies of IEA countries: Iraq. https://www.iea.org .

• Iraq Business News. (2025, July 27). Construction starts at 1000 MW solar power project in Basra. https://www.iraq-businessnews.com/2025/07/27/construction-starts-at-1000-mw-solar-power-project-in-basra/ .

• IraqiNews. (n.d.). Iraq to increase electricity production by 60000 megawatts. https://www.iraqinews.com/iraq/iraq-to-increase-electricity-production-by-60000-megawatts/ .

• Middle East Institute. (n.d.). Iraq needs renewables, but they won’t solve its power problems without broader reforms. https://www.mei.edu/publications/iraq-needs-renewables-they-wont-solve-its-power-problems-without-broader-reforms .

• PVKnowHow. (n.d.). Iraq solar panel manufacturing report: Market analysis and insights. https://www.pvknowhow.com/solar-report/iraq/ .

• Renewables Now. (2023). Iraq’s renewable energy projects. https://renewablesnow.com .

• Renewables Now. (n.d.). Construction progresses at 300-MW Karbala solar project in Iraq. https://renewablesnow.com/news/construction-progresses-at-300-mw-karbala-solar-project-in-iraq-1279604/ .

• United Nations Development Programme. (2023). Sustainable energy for all. https://www.undp.org .

• United Nations Development Programme. (n.d.). Open solar contracts and the future of solar energy in Iraq. https://www.undp.org/iraq/stories/open-solar-contracts-and-future-solar-energy-iraq .

• World Bank. (2023). Iraq: Country overview. https://www.worldbank.org/en/country/iraq .

• World Bank. (n.d.). Electric power transmission and distribution losses (% of output) - Iraq. https://data.worldbank.org/indicator/EG.ELC.LOSS.ZS?locations=IQ