Iraq signs power deals with French firms
Reuters, Sunday 2 Jan 2011
French companies Schneider Electric and Areva to build 15 power distribution stations in Basra while a Saudi private company is in talks with the Iraqi government to supply power to the southern province

Iraq signed deals worth $52 million with France's Schneider Electric and Areva to build 15 power distribution stations in the southern oil hub of Basra, a government official said.

Schneider Electric, has won a $29 million contract to build eight distribution stations, while Areva was awarded a $23 million deal to build seven plants, deputy governor of Basra, Ahmed Hameed, said on Sunday.

The projects would be financed by the province's share in oil revenue and don't need the approval of the Ministry of Electricity in Baghdad, Hameed said.

The province is also in talks with a Saudi private company to supply the southern province with power turbines that could provide it with an extra 150 megawatts, he said.

Last summer, days of protests in the Shi'ite south, including Basra, over crippling power cuts forced the then electricity minister to step down.

The national grid usually allocates 950 MW of power to Basra, but in case of any technical failure, the supply could fall to less than half of that amount, which is not enough to cover its needs, said Hameed.

Seven years after the U.S.-led invasion, Iraq's national grid still only supplies a few hours of power each day and intermittent electricity is one of the public's top complaints.

Iraq's available power capacity is about 9,000 MW, and installed capacity at 11,000 to 12,000 MW, according to Iraqi officials. Demand is estimated to reach 14,000 MW during summer when temperatures frequently exceed 50 Celsius.

Iraq plans to boost power capacity to 27,000 MW in four years and would need to invest at least $3 billion to $4 billion per year to reach that target.