Washington grants Iraq a waiver to pay for Iranian electricity

“The waiver ensures that Iraq is able to meet its short-term energy needs while it takes steps to reduce its dependence on Iranian energy imports,” said a US State Department.

Thursday 01/04/2021
Electrical grids in the southern Iraqi city of Nasiriyah. (AFP)
Electrical grids in the southern Iraqi city of Nasiriyah. (AFP)

WASHINGTON--The United States has renewed a waiver allowing Iraq to pay for electricity imported from Iran, this time giving Baghdad 120 days to reduce its energy dependence on neighbouring Tehran, a State Department spokesman said on Wednesday.

The waiver was renewed despite American sanctions imposed after former US President Donald Trump pulled out of the  2015 nuclear deal between the Islamic Republic and world powers and Iran began breaching the deal’s terms.

Washington has issued regular waivers to Iraq since it reimposed sanctions, but last year shortened their length to encourage Iraq to reduce its use of Iranian energy.

Wednesday’s 120-day extension was the first under President Joe Biden, who has sought to restart diplomacy with Iran over returning to the nuclear deal.

“The waiver ensures that Iraq is able to meet its short-term energy needs while it takes steps to reduce its dependence on Iranian energy imports,” the spokesman said.

However, such steps are taking time. Three years ago the Baghdad government’s Mass Energy Group Holding was negotiating a deal with GE Power to add up to 1.5 gigawatts (GW) of generation capacity to the Besmaya power plant not far from the capital.  This will bring the capacity of what is already the country’s largest power station up to 4.5GW, enough to supply four and a half million homes.