A technician with the United Nations Development Program inspects a residential rooftop solar panel at a pilot project in Najaf in 2020. (Photo credit: UNDP)
BAGHDAD/ERBIL - Norwegian energy firm Scatec has pulled out of negotiations to develop two solar projects in Iraq, dealing a significant setback to a nascent government effort to tap the potential of renewable energy.
Both Iraqi and private-sector officials had spoken of the Scatec deal as a precedent-setting exercise that would force Iraq to adapt its commercial and regulatory frameworks to align with the international standards expected by top solar companies. But the government's red tape seems to have stifled those ambitions.
Two senior Iraqi government officials and Scatec itself confirmed that the Oslo-based company has withdrawn from negotiations with Iraq’s Electricity Ministry over plans to build and operate two solar power farms with a combined power generation capacity of 525 MW in southern Iraq.
"The main reason [for Scatec’s withdrawal] was the procedures going slowly," said a senior Oil Ministry official with knowledge of Iraq’s solar power projects. "The Electricity Ministry was not specific, and the legislation for solar was not clear. So with the delays and slow procedures, they withdrew.... These solar projects are kind of new in nature for the government, so time is needed for the legislation."
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