On March 14, 2025, Mostafa Rajabi Mashhadi, the Director-General of Tavanir Iran Company, confirmed Iran's commitment to continue exporting electricity to Iraq, setting the tone for sustained cooperation between the two nations. This announcement came against the backdrop of intensifying efforts by the Iraqi government to expedite its debt payments to Iran for previous electricity supplies.
Mashhadi stated, "Electricity exports to Iraq will continue based on the agreement signed between the two countries and the remaining period of this commitment." This reflects Iran's adherence to the contract established years ago, which includes stipulations about the timing and volume of electricity supplied. He emphasized, "Exports will take place during off-peak hours after ensuring domestic electricity supply, highlighting the priority of local demand.
According to reports, Iraq currently produces about 26,000 megawatts of electricity daily, with 6,000 megawatts generated using gas sourced from Iran. The country relies significantly on Iranian electricity imports, which amount to approximately 1,200 megawatts. Despite being able to export natural gas, Iran supplies around 40 million cubic meters of gas daily to meet Iraqi needs, which are around 55 million cubic meters for optimal electricity generation.
The situation has been delicate, particularly with U.S. sanctions looming over such energy transactions. Recently, U.S. authorities signaled their intention not to extend exemptions for Iraq’s imports of Iranian electricity, pushing for Iraq to reduce its energy dependence on Iran. Mashhadi remarked, "The attempts by the United States to abolish Iraq's electricity imports from Iran will not affect Tehran's commitment to this agreement." This statement reaffirms Iran's resolve to uphold its energy trade agreements with Iraq, regardless of external pressures.
Despite recent hurdles, Mashhadi indicated progress has been made on the financial side, stating, "Part of it has been transferred during the past month," referring to the repayment of overdue debts. The Iraqi government is taking proactive measures to fulfill its financial obligations to Iran, highlighting the importance of this bilateral relationship.
Further complicity is arising from Iraq's urgent need to stabilize its electricity supply, as Iranian gas fuels key power infrastructure. Plants like Samaya, producing 3,500 megawatts, and the Sadr plant generating 560 megawatts, are particularly reliant on this gas. The Mansouriya plant, located east of Diyala Governorate, also contributes significantly with 770 megawatts to Iraq's energy mix.
Officials from Iraq have repeatedly expressed their challenges of transitioning to domestic energy sources, emphasizing, "there is currently no alternative to Iranian gas for our energy needs, and it will take more than two years to rely on local gas production." This dependency signifies the importance of maintaining import routes and agreements with Iran to avert any potential energy crises.
The discussions surrounding energy commerce with Iran have not only centered around Iraq but also included resilience strategies involving electricity negotiations with neighboring countries like Turkey and Russia. Mashhadi confirmed, "Negotiations with Turkey and Russia for electricity trade are still underway, and progress is expected to be made soon." This reflects Iran's broader vision of energy collaboration across the region, aiming to diversify its exporting capabilities and reduce reliance on individual market dependencies.
Moving forward, the growing energy needs of Iraq juxtaposed with the political pressures from the United States presents both nations with challenges and opportunities alike. The stability of electricity exports from Iran remains intertwined with economic agreements and political discussions, making it a pivotal point for energy security within Iraq and fostering bilateral ties.
Both governments remain committed to ensuring adherence to the agreements and methodologies to adjust according to domestic and regional energy demands. This agreement not only encapsulates their financial commitments but also showcases their dependency on each other for energy sufficiency.
With these structured plans and expressed commitments, it can be noted with optimism about how such collaborations will progress, positioning Iran and Iraq within the larger framework of regional energy dialogues.