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Iraq Electricity Crisis intensifies as summer heat drives demand; households face power outages, reliance on private generators, distorted tariffs, and strained grid capacity despite government reforms, Siemens upgrades, and IEA warnings.

Key Points

A supply-demand gap causing outages, generator reliance, and grid inefficiencies across Iraq, worsened by summer peaks.

✅ Siemens deal to upgrade generation and grid

✅ Progressive tariffs to curb demand and waste

✅ Private generators fill gaps but raise costs

At a demonstration in June 2018, protesters in Basra loaded a black box resembling a coffin with the inscription “Electricity” onto the roof of a car. This was one demonstration of how much of a political issue electricity is in Iraq.

With what is likely to be another hot summer ahead, there is increasing pressure on the Baghdad government to improve access to electricity and water.

Many Iraqis blame the government for not providing adequate services despite the country’s oil wealth. Protests in southern Iraq last year turned violent, with demonstrators attacking governmental and political parties’ buildings; in neighboring Iran, blackouts also sparked protests over outages.

“It is very hard” to deal with the electricity issues, said Iraqi journalist Methaq al-Fayyadh, adding that the lack of reliable electricity was not a new problem and affects most parts of the country.

Dozens of people protested June 1 in Karbala against prices for new generators and demanded an improvement to the electricity situation.

In anticipation of high temperatures during Eid al-Fitr, the Electricity Ministry called on governorates to adhere to allocated quotas and told the public to ration electricity.

“Outages remain a daily occurrence for most households because increasing generating capacity has been outrun by increasing demand for electricity, as surging demand worldwide demonstrates,” noted the International Energy Agency (IAE) in April.

This is particularly the case, the authors said, as the hot summer months, when temperatures can top 50 degrees Celsius, drive up the use of air conditioning.

The Iraqi government has made improving the electricity supply one of its priorities, including nuclear power plans under consideration. The Electricity Ministry, headed by Luay al-Khatteeb, announced in May that national electricity production had reached 17 gigawatts.

Khatteeb presented comparative electricity data for May from 2018 and 2019, indicating production increases on every day of the month. IEA data indicate that available electricity supply has increased over the past five years and the gap between supply and demand has widened.

The government signed an agreement with German company Siemens this year to upgrade Iraq’s electricity grid, and in parallel deals with Iran to rehabilitate and develop the grid were finalized, according to Iranian officials. The agreement “includes the addition of new and highly efficient power generation capacity, rehabilitation and upgrade of existing plants and the expansion of transmission and distribution networks,” Siemens said.

The Iraqi prime minister’s office said the 4-year plan would be worth $15.7 billion. The first phase includes the installation of 13 transformer stations, cooling systems for power stations and building a 500-megawatt, gas-fired power plant south of Baghdad.

In an interview with Al-Monitor, Khatteeb said radical changes would happen in 2020, stating that the current situation was not “ideal” but “better” because of steps taken to create more energy, amid discussions on energy cooperation with Iran that could shape implementation.

Robert Tollast, of the Iraq Energy Institute, said the economics of the electricity system is distorted. Subsidies ensured that electricity provided by the national grid is almost free, he said. However, while the subsidies were designed to help the poor, the tariff system disadvantages them and does not create incentives to consume electricity more efficiently, he said.

A large part of families’ electricity expenditures goes to operators of privately owned generators, which run on fuel. These neighbourhood generators are used to close gaps in the electricity supply but are expensive, and regional fuel arrangements such as ENOC’s swap of Iraqi fuel have highlighted supply constraints. Generator operators have sometimes worked with armed groups to prevent upgrades to the grid that could hurt their business.

Until 1990, the Iraq electricity sector was considered among the best in the region. That legacy was destroyed by successive wars and international sanctions. With Iraq’s population growing at a rate of 1 million per year, peak demand is projected to double by 2030 if left unchecked, the IEA estimated.

Tollast said efforts to improve the distribution system and increase capacity are key but it is important “to tackle the problem from the demand side.” This entails implementing a progressive tariff scheme so users pay more if they consume more, he said. There is a “tremendous use of energy per capita in Iraq,” Tollast said.

In the current tariff structure, consumers pay a fixed price if they use more than 4,000-kilowatt hours per year, a relatively low amount, meaning the price per unit drops the more one consumes.

Any change to the tariff system must be accompanied by a “political campaign” to explain the changes, said Tollast, adding that more investment in the electricity sector and a “change in culture” of using electricity was needed. “The current system is unsustainable, even with high oil prices,” he said.

Fayyadh said people don’t expect the government will be able to fix the electricity issue before summer, having failed to do so in the past.

Tollast struck a more optimistic tone, saying it was unlikely that Iran, which supplies about 40% of Iraq’s power, would cut its export of electricity to Iraq this year as it did in 2018. He added that the water situation was better than last year when the country experienced drought. Iraq has also been processing more flare gas, which can be used to generate electricity.

“There is an expectation that this year might not be as bad as last year,” he concluded.

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Canada EV Tariffs weigh protectionism, import duties, and trade policy against affordable electric vehicles, climate goals, and consumer costs, balancing domestic manufacturing, critical minerals, battery supply chains, and China relations amid US-EU actions.

Key Points

Canada EV Tariffs are proposed duties on Chinese EV imports to protect jobs vs. prices, climate goals, and trade risks.

✅ Shield domestic automakers; counter subsidies

✅ Raise EV prices; slow adoption, climate targets

✅ Spark China retaliation; hit exports, supply chains

Canada, a rising star in critical EV battery minerals, finds itself at a crossroads. The question: should they follow the US and EU and impose tariffs on Chinese electric vehicles (EVs), after the U.S. 100% tariff on Chinese EVs set a precedent?

The Allure of Protectionism

Proponents see tariffs as a shield for Canada's auto industry, supported by recent EV assembly deals that put Canada in the race, a vital job creator. They argue that cheaper Chinese EVs, potentially boosted by government subsidies, threaten Canadian manufacturers. Tariffs, they believe, would level the playing field.

Consumer Concerns and Environmental Impact

Opponents fear tariffs will translate to higher prices, deterring Canadians from buying EVs, especially amid EV shortages and wait times already affecting the market. This could slow down Canada's transition to cleaner transportation, crucial for meeting climate goals. A slower EV adoption could also impact Canada's potential as an EV leader.

The Looming Trade War Shadow

Tariffs risk escalating tensions with China, Canada's second-largest trading partner. China might retaliate with tariffs on Canadian exports, jeopardizing sectors like oil and lumber. This could harm the Canadian economy and disrupt critical mineral and battery development, areas where Canada is strategically positioned, even as opportunities to capitalize on the U.S. EV pivot continue to emerge across North America.

Navigating a Charged Path

The Canadian government faces a complex decision. Protecting domestic jobs is important, but so is keeping EVs affordable for a greener future and advancing EV sales regulations that shape the market. Canada must carefully consider the potential benefits of tariffs against the risks of higher consumer costs and a potential trade war.

This path forward could involve exploring alternative solutions. Canada could invest in its domestic EV industry, providing incentives for both consumers and manufacturers. Additionally, collaborating with other countries, including Canada-U.S. collaboration as companies turn to EVs, to address China's alleged unfair trade practices might be a more strategic approach.

Canada's decision on EV tariffs will have far-reaching consequences. Striking a balance between protecting its domestic industry and fostering a robust, environmentally friendly transportation sector, and meeting ambitious EV goals set by policymakers, is crucial. Only time will tell which path Canada chooses, but the stakes are high, impacting not just jobs, but also the environment and Canada's position in the global EV race.

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Neste wind power agreement boosts renewable electricity in Finland, partnering with Ilmatar and Fortum to supply Porvoo and Naantali sites, cutting Scope 2 emissions and advancing a 2035 carbon-neutral production target via long-term PPAs.

Key Points

A PPA to source wind power for sites, cutting Scope 2 emissions and supporting Neste's 2035 carbon-neutral goal.

✅ 10-year PPA with Ilmatar; + Fortum boosts renewable electricity share.

✅ Supplies ~7% of Porvoo-Naantali electricity; capacity >20 MW.

✅ Cuts Scope 2 emissions by ~55 kt CO2e per year toward 2035 neutrality.

Neste is committed to reaching carbon neutral production by 2035, mirroring efforts such as Olympus 100% renewable electricity commitments across industry.

As part of this effort, the company is increasing the use of renewable electricity at its production sites in Finland, reflecting trends such as Ireland's green electricity targets across Europe, and has signed a wind power agreement with Ilmatar, a wind power company. The agreement has been made together with Borealis, Neste's long-term partner in the Kilpilahti area in Porvoo, Finland.

As a result of the agreement with Ilmatar, as well as that signed with Fortum at the end of 2019, and in line with global growth such as Enel's 450 MW wind project in the U.S., nearly 30% of the energy used at Neste's production sites in Porvoo and Naantali will be renewable wind power in 2022.

'Neste's purpose is to create a healthier planet for our children. Our two climate commitments play an important role in living up to this ambition, and one of them is to reach carbon neutral production by 2035. It is an enormous challenge and requires several concrete measures and investments, including innovations like offshore green hydrogen initiatives. Wind power, including advances like UK offshore wind projects, is one of the over 70 measures we have identified to reduce our production's greenhouse gas emissions,' Neste's President and CEO Peter Vanacker says.

With the ten year contract, Neste is committed to purchase about one-third of the production of Ilmatar's two wind farms, reflecting broader market moves such as BC Hydro wind deals in Canada. The total capacity of the agreement is more than 20 MW, and the energy produced will correspond to around 7% of the electricity consumption at Neste's sites in Porvoo and Naantali. The wind power deliveries are expected to begin in 2022.

The two wind power agreements help Neste to reduce the indirect greenhouse gas emissions (Scope 2 emissions defined by the Greenhouse Gas Protocol) of electricity purchases at its Finnish production sites, a trend mirrored by Dutch green electricity growth across Europe, annually by approximately 55 kilotons. 55 kt/a CO2e equals annual carbon footprint of more than 8,500 EU citizens.

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Canada 2035 Clean Electricity Target faces a 48.4GW shortfall as renewable capacity lags; accelerating wind, solar PV, grid upgrades, and coherent federal-provincial policy is vital to reach zero-emissions power and strengthen transmission and distribution.

Key Points

Canada's plan to supply nearly 100% of electricity from zero-emitting sources by 2035, requiring renewable buildout.

✅ Average adds 2.6GW; shortfall totals 48.4GW by 2035

✅ Expand wind, solar PV, storage, and grid modernization

✅ Align federal-province policy; retire or convert thermal plants

GlobalData’s latest report, ‘Canada Power Market Size and Trends by Installed Capacity, Generation, Transmission, Distribution and Technology, Regulations, Key Players and Forecast, 2022-2035’, discusses the power market structure of Canada and, amid looming power challenges, provides historical and forecast numbers for capacity, generation and consumption up to 2035. Detailed analysis of the country’s power market regulatory structure, competitive landscape and a list of major power plants are provided. The report also gives a snapshot of the power sector in the country on broad parameters of macroeconomics, supply security, generation infrastructure, transmission and distribution infrastructure, electricity import and export scenario, degree of competition, regulatory scenario, and future potential. An analysis of the deals in the country’s power sector is also included in the report.

Canada is expected to fall short of its 2035 clean electricity target after reviewing the country’s current renewable capacity activity. The country has targeted to produce nearly 100% of its electricity from zero-emitting sources by 2035, while electricity associations' net-zero goals extend to 2050; however, the country is adding only 2.6GW of annual renewable capacity additions on average every year, which would mean a cumulative shortfall of 48.4GW.

Canada has good governmental support, but it is not doing enough to ensure its targets are met. If the country is to meet its target to produce nearly 100% of electricity from zero-emitting sources by 2035, the country should both increase the capacity and efficiency of renewable power plants, as well as provide comprehensive end-to-end policies at both the federal and provincial levels, as debates over whether Ontario is embracing clean power continue across provinces. It should also involve communities and businesses in raising awareness of the benefits of adopting renewable energy.

The country has a large amount of proven natural gas and oil reserves that are proving too tempting an opportunity, and the Canadian Government is planning to increase the capacity of its gas-based plants under net-zero regulations permit some gas in the power mix, to secure real-time demand and supply. However, the country’s dependency on gas-based plants creates a major challenge to achieve its 2035 clean electricity target.

If the Canadian Government is to meet its 2035 targets, it should draw on examples from its European counterparts and add renewable capacity at a rapid pace, while balancing demand and emissions in key provinces. One advantage for Canada here is that it does not have land constraints, which is common in other major renewable power-generating countries. This could give the country an estimated 6.1GW of renewable capacity every year on average during the 2021-2035 period: enough capacity to meet its target. Most of these installations are expected to be for wind and solar PV.

Changing provincial governments are not helpful when it comes to implementing long-term projects, especially as Ontario faces looming electricity shortfalls that heighten planning risks, and continued stopping and starting of projects like this will only be damaging to renewable goals. Another way the country can achieve its target is by converting thermal power plants into clean energy plants and providing a roadmap or timeline for provinces to retire thermal power plants completely, even as scrapping coal can be costly for some systems.

Canada’s GDP (at constant prices) increased from $1,617.3bn in 2010 to $1,924.5bn in 2021, at a CAGR of 1.6%. The GDP (at constant prices) of the country declined sharply from $1,943.8bn in 2019 to $1,840.5bn in 2020 because of Covid-19 pandemic. After the recommencement of regular industrial and trade activities, the GDP grew by 4.6% in 2021 from 2020. The GDP is expected to cross pre-pandemic levels by the end of 2022.

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Ontario Global Adjustment Charge faces constitutional scrutiny as a regulatory charge vs tax; Court of Appeal revives case over electricity pricing, feed-in tariff contracts, IESO policy, and hydro rate impacts on consumers and industry.

Key Points

A provincial electricity fee funding generator contracts, now central to a court fight over tax versus regulatory charge.

✅ Funds gap between market price and contracted generator rates

✅ At issue: regulatory charge vs tax under constitutional law

✅ Linked to feed-in tariff, IESO policy, and hydro rate hikes

Ontario’s court of appeal has decided that a constitutional challenge of a steep provincial electricity charge should get its day in court, overturning a lower-court judgment that had dismissed the legal bid.

Hamilton, Ont.-based National Steel Car Ltd. launched the challenge in 2017, saying Ontario’s so-called global adjustment charge was unconstitutional because it is a tax — not a valid regulatory charge — that was not passed by the legislature.

The global adjustment funds the difference between the province’s hourly electricity price and the price guaranteed under contracts to power generators. It is “the component that covers the cost of building new electricity infrastructure in the province, maintaining existing resources, as well as providing conservation and demand management programs,” the province’s Independent Electricity System Operator says.

However, the global adjustment now makes up most of the commodity portion of a household electricity bill, and its costs have ballooned, as regulators elsewhere consider a proposed 14% rate hike in Nova Scotia.

Ontario’s auditor general said in 2015 that global adjustment fees had increased from $650 million in 2006 to more than $7 billion in 2014. She added that consumers would pay $133 billion in global adjustment fees from 2015 to 2032, after having already paid $37 billion from 2006 to 2014.

National Steel Car, which manufactures steel rail cars and faces high electricity rates that hurt Ontario factories, said its global adjustment costs went from $207,260 in 2008 to almost $3.4 million in 2016, according to an Ontario Court of Appeal decision released on Wednesday.

The company claimed the global adjustment was a tax because one of its components funds electricity procurement contracts under a “feed-in tariff” program, or FIT, which National Steel Car called “the main culprit behind the dramatic price increases for electricity,” the decision said.

Ontario’s auditor general said the FIT program “paid excessive prices to renewable energy generators.” The program has been ended, but contracts awarded under it remain in place.

National Steel Car claimed the FIT program “was actually designed to accomplish social goals unrelated to the generation of electricity,” such as helping rural and indigenous communities, and was therefore a tax trying to help with policy goals.

“The appellant submits that the Policy Goals can be achieved by Ontario in several ways, just not through the electricity pricing formula,” the decision said.

National Steel Car also argued the global adjustment violated a provincial law that requires the government to hold a referendum for new taxes.

“The appellant’s principal claim is that the Global Adjustment was a ‘colourable attempt to disguise a tax as a regulatory charge with the purpose of funding the costs of the Policy Goals,’” the decision said. “The appellant pressed this argument before the motion judge and before this court. The motion judge did not directly or adequately address it.”

The Ontario government applied to have the challenge thrown out for having “no reasonable cause of action,” and a Superior Court judge did so in 2018, saying the global adjustment is not a tax.

National Steel Car appealed the decision, and the decision published Wednesday allowed the appeal, set aside the lower-court judgment, and will send the case back to Superior Court, where it could get a full hearing.

“The appellant’s claim is sufficiently plausible on the evidentiary record it put forward that the applications should not have been dismissed on a pleadings motion before the development of a full record,” wrote Justice Peter D. Lauwers. “It is not plain, obvious and beyond doubt that the Global Adjustment, and particularly the challenged component, is properly characterized as a valid regulatory charge and not as an impermissible tax.”

Jerome Morse of Morse Shannon LLP, one of National Steel Car’s lawyers, said the Ontario government would now have 60 days to decide whether to seek permission to appeal to the Supreme Court of Canada.

“What the court has basically said is, ‘this is a plausible argument, here are the reasons why it’s plausible, there was no answer to this,’” Morse told the Financial Post.

Ontario and the IESO had supported the lower-court decision, but there has been a change in government since the challenge was first launched, with Progressive Conservative Premier Doug Ford replacing the Liberals and Kathleen Wynne in power. The Liberals had launched a plan aimed at addressing hydro costs before losing in a 2018 election, the main thrust of which had been to refinance global adjustment costs.

Wednesday’s decision states that “Ontario’s counsel advised the court that the current Ontario government ‘does not agree with the former government’s electricity procurement policy (since-repealed).’

“The government’s view is that: ‘The solution does not lie with the courts, but instead in the political arena with political actors,’” it adds.

A spokesperson for Ontario Energy Minister Greg Rickford said in an email that they are reviewing the decision but “as this matter is in the appeal period, it would be inappropriate to comment.” 

Ontario had also requested to stay the matter so a regulator, the Ontario Energy Board, could weigh in, while the Nova Scotia regulator approved a 14% hike in a separate case.

“However, Ontario only sought this relief from the motion judge in the alternative, and given the motion judge’s ultimate decision, she did not rule on the stay,” Thursday’s decision said. “It would be premature for this court to rule on the issue, although it seems incongruous for Ontario to argue that the Superior Court is the convenient forum in which to seek to dismiss the applications as meritless, but that it is not the convenient forum for assessing the merits of the applications.”

National Steel Car’s challenge bears a resemblance to the constitutional challenges launched by Ontario and other provinces over the federal government’s carbon tax, but Justice Lauwers wrote “that the federal legislative scheme under consideration in those cases is distinctly different from the legislation at issue in this appeal.”

“Nothing in those decisions impacts this appeal,” the judge added.
 

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Zaporizhzhia Nuclear Plant Mines reported by IAEA at the Russian-occupied site: anti-personnel devices in a buffer zone, restricted areas; access limits to reactor rooftops and turbine halls heighten nuclear safety and security concerns in Ukraine.

Key Points

IAEA reports anti-personnel mines at Russian-held Zaporizhzhia, raising nuclear safety risks in buffer zones.

✅ IAEA observes mines in buffer zone at occupied site

✅ Restricted areas; no roof or turbine hall access granted

✅ Safety systems unaffected, but staff under pressure

The United Nations atomic watchdog said it saw anti-personnel mines at the site of Ukraine's Zaporizhzhia nuclear power plant which is occupied by Russian forces.

Europe's largest nuclear facility fell to Russian forces shortly after the invasion of Ukraine in February last year, as Moscow later sought to build power lines to reactivate it amid ongoing control of the area. Kyiv and Moscow have since accused each other of planning an incident at the site.

On July 23 International Atomic Energy Agency (IAEA) experts "saw some mines located in a buffer zone between the site's internal and external perimeter barriers," agency chief Rafael Grossi said in a statement on Monday.

The statement did not say how many mines the team had seen.

The devices were in "restricted areas" that operating plant personnel cannot access, Mr Grossi said, adding the IAEA's initial assessment was that any detonation "should not affect the site's nuclear safety and security systems".

Laying explosives at the site was "inconsistent with the IAEA safety standards and nuclear security guidance" and, amid controversial proposals on Ukraine's nuclear plants that have circulated internationally, created additional psychological pressure on staff, he added.

Ukrainians in Nikopol are out of water and within Russia's firing line. But Zaporizhzhia nuclear power plant could pose the biggest threat, even as Ukraine has resumed electricity exports to regional grids.

Last week the IAEA said its experts had carried out inspections at the plant, without "observing" the presence of any mines, although they had not been given access to the rooftops of the reactor buildings, while a possible agreement to curb attacks on plants was being discussed.

The IAEA had still not been given access to the roofs of the reactor buildings and their turbine halls, its latest statement said, even as a proposal to control Ukraine's nuclear plants drew scrutiny.

After falling into Russian hands, Europe's biggest power plant was targeted by gunfire and has been severed from the grid several times, raising nuclear risk warnings from the IAEA and others.

The six reactor units, which before the war produced around a fifth of Ukraine's electricity, have been shut down for months, prompting interest in wind power development as a harder-to-disrupt source.

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