Energy

Iraq signs power-generation deals with US companies

April 10, 2025, 11:46 AM

Iranian president Masoud Pezeshkian (L) with Iraqi prime minister Mohammed Shia Al-Sudani during a visit last year. The US has ended waivers which let Iraq buy Iranian electricity and gas

Step toward solving electricity crisis
Two companies to provide 27GW
Plants to be built across Iraq

Iraq has signed memoranda of understanding with two US companies to generate more than 27 gigawatts (GW) of electricity, including a giant solar power plant, according to the prime minister’s office.

The electricity ministry signed the two MoUs with Massachusetts-based GE Vernova and Florida-based UGT Renewables in Baghdad on Wednesday during a visit by more than 100 US business executives.

Despite being home to some of the largest oil and gas reserves in the world, Iraq suffers persistent electricity shortages, more than 20 years after a US-led invasion.

The country has been reliant on supplies of both electricity and gas from neighbouring Iran but the US government has ended waivers which allowed for the imports. Iran is in any case itself suffering from chronic shortages of gas.

The government of Mohammed Shia al-Sudani, the prime minister, has been seeking to connect the Iraqi grid with neighbouring states, notably Jordan, and is in the process of building offshore terminals to receive liquefied natural gas.

Al-Sudani, who met representatives of UGT Renewables in London during a visit to the UK in January, faces re-election in parliamentary elections in November.

Under the agreement, GE will build combined cycle gas turbine (CCGT) power plants in various parts of Iraq with a combined generation capacity of nearly 24GW.

UGT Renewables will build a giant integrated solar power complex with a capacity of 3GW besides a 500 megawatt storage facility.

“These agreements are the largest and the latest in Iraq’s history as they include integrated projects with massive production capacity,” the official daily Alsabah said.

“The MoU also includes provisions for securing external financing through major global banks,” the paper said. The projects are backed by the US Export-Import Bank (EXIM) and the UK Export Finance with JP Morgan as lead arranger.

The projects include the construction of solar power parks and switching public buildings and other facilities in Iraq to solar power.

Iraq has awarded solar power contracts to a number of foreign companies over the past two years with a combined production capacity of 7.5GW as part of a post-war drive to rebuild its ageing and damaged electricity networks.

The country has suffered from a large electricity supply shortage since the end of the conflict and the gap has worsened after a sharp decline in Iranian gas supplies in the past two years.

The Electricity Ministry last month estimated the shortage at more than 10GW during the peak summer season.