Iraq pursues ambitious environmental reform to tackle fossil fuel dependence
Shafaq News/ Iraq, one of the world's leading countries in associatednatural gas flaring during oil extraction, is urgently searching for hundredsof billions of dollars to fund its environmental ambitions. As the nationparticipated in COP29, it faces a daunting challenge: balancing its oil-relianteconomy with the pressing need to transition to sustainable energy.
Heavy Dependence on Fossil Fuels
Iraq’s economy is deeply tied to oil, which accounts for over 95% of itsexports, 85% of government revenue, and approximately 42% of its GDP. Thisheavy dependence leaves the country highly vulnerable to fluctuations in globaloil prices, threatening economic stability and the delivery of publicservices.
Energy production in Iraq reflects this reliance. Natural gas generates60% of Iraq's electricity, oil contributes 35%, and renewable energy, primarilyhydroelectric, accounts only 5.5%. Despite producing significant quantities ofnatural gas, Iraq flares a substantial portion due to inefficient practices,releasing harmful methane emissions.
The government’s fiscal vulnerability is compounded by an aging energyinfrastructure, which relies heavily on fossil fuels for extraction, refining,and electricity generation.
Environmental Challenges and Ambitious Targets
The environmental cost of Iraq’s fossil fuel dependency is stark. TheInternational Finance Corporation estimates Iraq will require $233 billion by2040 to meet its climate goals, which include reducing greenhouse gasemissions, capturing associated gas, and improving energy efficiency.
The country’s Nationally Determined Contribution (NDC) pledges to cutemissions by 15% by 2030, but 13% of this target relies on internationalsupport.
In 2023, Iraq reduced gas flaring by achieving a 60% utilization ratefor associated gas, according to Deputy Minister of Oil for Gas Affairs, EzzatSaber. However, the country still flared 636.8 billion cubic feet of gas thatyear, contributing heavily to methane emissions.
International support has begun to flow. The United Kingdom recentlyannounced $6.5 million in funding for Iraq as part of its broader efforts tocombat climate change. This assistance focuses on transitioning to cleanenergy, improving climate resilience, and building technical capacity.
Notably, at COP29, Iraq successfully resisted proposals to phase outfossil fuels, arguing that such measures could undermine its economic stability.Majid Shankali, Chairman of the Parliamentary Health and Environment Committee,emphasized the importance of balancing economic needs with environmentalgoals.
Political and Security Obstacles
Efforts to implement environmental reforms face significant politicaland security hurdles. External and internal interference frequently obstructkey decisions and initiatives.
Economist Durgham Mohammed Ali told Shafaq News that Iraq's reliance onfossil fuels makes a full transition to clean energy unfeasible within the nextthree decades. "Even wealthier countries with better environmentalconditions haven’t managed a complete shift to green energy," he noted.
However, the government has initiated plans for a partial transition byconstructing two solar power plants with remarkable generation capacity."These efforts remain far from achieving a full transition, focusinginstead on relative integration of clean energy," he added.
Ali emphasized the need to reduce reliance on private diesel generators,which are more polluting than other fuel sources. "Supporting individualsthrough loans and providing reliable solar energy systems will help diminishdependence on private generators," he said.
Moreover, Political interference, both from internal and externalactors, has been cited as one of the main obstacles to Iraq’s environmentalreforms.
Muzher Salih, an adviser to the Prime Minister, highlighted thegovernment’s strategy to phase out gas flaring within three years byrepurposing associated gas for electricity generation, cooking, or export. Yet,he acknowledged that “efforts may be delayed due to a lack of politicalconsensus on environmental matters.”
Oil expert Hamza al-Jawahiri echoed these concerns. "The governmentis serious about transitioning to cleaner energy, but political interferenceobstructs every major decision in this direction," he said.
Al-Jawahiri stressed the need for carbon tax regulations and strictpolicies on gas flaring, alongside a robust regulatory body insulated fromexternal pressures.
Government Initiatives and Vision for a Greener Future
Despite the challenges, Iraq has launched several initiatives aimed atreducing its fossil fuel dependency and adopting sustainable energypractices.
In 2024, the government introduced the National Strategy forEnvironmental Protection and Improvement for the period 2024–2030, incollaboration with the United Nations Development Programme (UNDP) and theUnited States Agency for International Development (USAID). This strategyfocuses on cutting greenhouse gas emissions, boosting energy efficiency, andpromoting sustainable development.
Iraq has also set ambitious targets for renewable energy. The governmentplans to generate 12 gigawatts of solar power by 2030 and produce 800 tonnes ofgreen hydrogen. Additionally, two solar power plants with significantgeneration capacities are under construction, signaling a partial shift towardclean energy.
To further reduce pollution, Iraq is prioritizing the capture andutilization of flared gas. By investing in modern gas infrastructure, thegovernment aims to lower emissions and improve energy efficiency.
Private diesel generators, a major source of air pollution, are anotherfocus. Ali suggested that offering loans and robust solar energy systems toindividuals could significantly reduce reliance on these generators,contributing to cleaner energy consumption.
Structural and Institutional Challenges
Transitioning to renewable energy requires addressing Iraq’s outdatedinfrastructure and regulatory shortcomings. The country’s energy sectorcontinues to rely on aging technologies that hinder efficiency and exacerbateenvironmental degradation.
Effective environmental regulations remain scarce. Experts call forstronger carbon taxes and stricter policies on gas flaring. However, theabsence of an empowered regulatory authority allows political pressures toderail these initiatives.
During COP29, Iraq secured $30 million from the Green Climate Fund toaid its climate efforts. While this support is a step forward, it isinsufficient to overhaul Iraq’s energy sector, which requires extensivemodernization to reduce its dependence on fossil fuels.
