CODEL BAIRD DISCUSSES IRAQ'S ENERGY NEEDS WITH

UNCLAS BAGHDAD 002693 SIPDIS SENSITIVE SIPDIS E.O. 12958: N/A TAGS: ECON ENGR EPET IZ SUBJECT: CODEL BAIRD DISCUSSES IRAQ'S ENERGY NEEDS WITH ELECTRICITY MINISTER ¶1. (SBU) Begin Summary: Electricity Minister Dr. Karim Wahid al-Hassani outlined Iraq's energy needs to CODEL Baird (Rep. Brian Baird (D-WA),Rep. Christopher Shays (R-CT),and Rep. Ralph Hall (R-TX)) in an August 11 meeting. Highlighting security and fuel shortages as the two most pressing issues, Wahid described his ministry's efforts to improve the provision of this essential service to Iraqis. Because of the great distances between electricity generation facilities and Baghdad in particular, the national grid is particularly vulnerable to interdiction. In order to address this, Wahid noted, construction of new generation facilities located closer to Baghdad is underway. In spite of Iraq's tremendous oil resources, a dearth of refining facilities necessitates the import of fuel for electricity generation. Further, lack of cooperation between key ministries, notably with the Ministry of Oil, hampers the GOI's ability to import sufficient quantities of fuel. Congressman Baird recommended that the Electricity Minister investigate renewable energy as a potential salve for Iraq's energy woes. End Summary. ¶2. (SBU) Congressman Brian Baird opened the August 11 meeting by asking for a brief description of Iraq's current energy needs. Electricity Minister Dr. Karim Wahid al-Hassani highlighted two main issues affecting the government's ability to provide electricity to its citizens: the security situation and fuel shortages. Iraq's energy infrastructure is vulnerable to insurgent attacks, Wahid explained, and until the restoration of peace and stability, the government of Iraq's (GOI) ability to meet Iraqis' demand for electricity will be compromised. With the advent of the Baghdad Security Plan, the GOI has begun to achieve gains on the security front, Wahid added. Once the security situation is resolved, greater foreign investment in Iraq's energy sector infrastructure may resume. ¶3. (SBU) Three major refineries, Bayji in Salah ad Din province north of Baghdad, Daura refinery in central Baghdad, and the Southern Refining Company in Basrah, constitute the overwhelming majority of Iraq's refining capabilities, Wahid said. The refineries are supplied by natural gas and oil pipelines from major fields in the north and the south. Currently, electricity generation meets 60 to 65 percent of demand. Wahid complained that a shortage of natural gas adversely affects Baghdad's power generation units' ability to cope with demand. ¶4. (SBU) Wahid continued that the Ministry of Oil (MoO),by failing to develop plans for renovating badly deteriorating refineries or the construction of new facilities, shouldered much of the blame for the electricity problems in Iraq. Many of the pipelines supplying oil and gas for electricity generation were not operating at full capacity due to much needed repairs, he complained, and the MoO was not addressing the need. Further, the Daura refinery continues the needless waste or flaring of natural gas, Wahid added, but the MoO has provided no plan for renovating the refinery to capture and utilize the gas. Currently, the MoO, the Ministry of Planning Development and Cooperation (MoPDC),and the Ministry of Electricity (MoE) convene weekly meetings to coordinate projects related to energy generation, but the focus thus far has been on increasing the amount of crude oil designated for export rather than electricity generation. ¶5. (SBU) Congressman Baird suggested that the GOI focus on reducing the distance between electricity generation and the distribution centers. Wahid responded that currently five electricity generation plants are under construction in the Baghdad area. The primary problem has been getting the petroleum product to the plants. One possible source was the oil from the fields east of Baghdad; however, that oil requires additional refining before it may be rendered suitable for use in the generators. ¶6. (SBU) Congressman Baird inquired whether the GOI had investigated renewable energy sources as a possible solution to electricity shortages in Iraq. Wahid stated that wind power had been deemed infeasible, but that solar energy solutions were being developed. Currently, 5,200 solar powered cells were being installed throughout Baghdad to power streetlights, and the MoE was investigating the feasibility of installing residential solar powered cells. Congressman Baird suggested putting Wahid in touch with a notable expert in the field of renewable energy technologies. ¶7. (U) CODEL Baird did not have the opportunity to clear on this cable. CROCKER