Oil, gas and Iran economic analyst
Several organizations in Iran's power industry warn of a 26,000 MW electricity deficit next summer, exceeding 30% of peak demand, compounded by natural gas shortages affecting both industries and households.
Ali Nikbakht, Chairman of the Board of Directors of the Iran Power Plants Association, reported this summer's electricity shortage at 19 to 20 GW. He warned that if immediate action isn't taken, the deficit could reach 26 GW next year. Similar concerns were echoed by Hamidreza Salehi, Chairman of the Federation of Energy Exports and Associated Industries, and Hassan Ali Taghizadeh, Chairman of the Electricity Syndicate.
All three officials agreed that not only is it unrealistic to resolve the electricity deficit in the short term, but there is little hope of even sustaining the current level of imbalance.
Aging power plants
Nikbakht also emphasized the aging and deterioration of a significant portion of the country's power plant capacity. He pointed out that one major power plant has already halted operations for repairs, stating, “The spare parts for this plant should have been ordered two years ago, but that didn’t happen, exacerbating the electricity shortage.”
He further explained that while the total nominal capacity of Iran's power plants is over 92 GW, much of it is outdated. “Of the 15 GW nominal capacity of steam power plants, about 12 GW are over 30 years old. In the case of gas power plants, 2.7 GW have also exceeded 30 years of age,” he said.
As a result, 80% of steam power plants and 11% of gas power plants are effectively outdated. These low-efficiency thermal plants account for 43% of the country's nominal power plant capacity.
This aging infrastructure, combined with a steep drop in hydropower generation due to drought, has significantly reduced Iran's actual power production. Despite having around 93.3 GW of installed nominal capacity, the country's real power generation is only about 61 GW, meaning that 30% of Iran's power generation capacity is currently offline.
Growing electricity deficit
Iran should have increased its power production by at least 7% annually for over a decade to meet the growing demand. However, the last time this goal was achieved was in 2010. Since then, the country's electricity consumption has grown at twice the rate of its production. As a result, Iran, which had a net export of 8 terawatt-hours of electricity annually until the mid-2010s, is now facing a massive power shortage.
The issue is that Iran now faces electricity deficits year-round, not just during the summer. Since last spring, the Ministry of Energy has stopped releasing its monthly statistics. However, a report obtained by Iran International earlier this summer revealed that even in the final month of spring, the country faced a 5 GW deficit during peak nighttime hours and a 10 GW shortfall during peak daytime hours.
This deficit surged to 20 GW during this summer's peak demand and is projected to reach 26 GW by next summer. To put this into perspective, this deficit is 1.5 times the total electricity generation of Iran’s northern neighbors—Azerbaijan, Armenia, and Turkmenistan—all of whom export electricity to Iran.
With such a vast imbalance between supply and demand, coupled with ongoing annual growth in consumption, it’s unlikely that Iran will resolve this shortage within the next decade, even if it triples its investment in the power sector. The country needs $20 billion in investment just to cover the current electricity deficit, plus at least $4 billion annually to support the 7% growth in power production needed to meet rising demand.
The primary driver behind Iran’s increasing electricity consumption is the addition of about one million new subscribers to the grid each year, with three-quarters being residential consumers and the remainder from industry, agriculture, and commercial sectors.
Moreover, hundreds of millions of dollars are required annually for the maintenance and repair of aging power plants. Nikbakht noted that the annual maintenance cost for each power plant is approximately $3 million.
A critical concern is the government’s growing debt to private power plant owners, which has quadrupled over the past three years. By the beginning of this year, it surpassed 900 trillion rials ($1.5 billion based on the open market exchange rate or $2.1 billion at the official rate). This mounting debt makes it unlikely that the private sector will continue to invest in the power industry.
Government Deflection
Hassan Ali Taghizadeh, Chairman of the Board of Directors of the Electricity Syndicate, recently warned, "With the current approach, we will face a 25 GW electricity imbalance next year." He also criticized Iranian authorities for blaming the public for excessive electricity consumption, pointing out that the average household consumption in Iran is not only below the global average but nearly half of that in Europe. "Why accuse people of being wasteful? Don’t blame the public for the electricity imbalance."
Statistics reveal that the average household electricity consumption per capita in Iran is under 1,200 kilowatt-hours, compared to about 1,800 kilowatt-hours in the European Union. In countries like the United States and the Arab Gulf states, consumption is several times higher than in Iran.
Blaming the public becomes even more misplaced when considering that 13% of Iran’s electricity is lost in its outdated transmission and distribution network, which the government has neglected to modernize for two decades. This loss is equivalent to 40% of the country’s household electricity consumption, translating into a staggering $4 to $5 billion annual loss at current regional electricity prices.
Additionally, over the past decade, Iran has failed to convert its low-efficiency steam and gas power plants into combined-cycle plants, which boast a 45% efficiency rate. Currently, combined-cycle plants account for just 39% of Iran’s nominal power generation capacity, while low-efficiency steam and gas plants together still make up 43%.
Meanwhile, the share of nuclear and renewable energy in Iran’s power generation capacity remains just 1% each, with the remainder made up by hydropower plants.
The lake, which received nearly one billion cubic meters of water during the winter and spring, has now evaporated, leaving behind an environmental and public health crisis for the nearly five million residents in the surrounding areas.
This marks the second time in recent years that the lake has nearly disappeared. The latest drying occurred despite seasonal efforts to replenish its water levels. Satellite imagery shows a vast white salt crust in both the northern and southern sections of the lake, a sign of extreme evaporation.
The crisis stems from a combination of prolonged droughts, overuse of water by local communities, and poorly planned dam construction along the lake's tributaries, all worsened by the government’s handling of the situation.
Experts attribute the shrinking of Lake Urmia, which has lost nearly 95 percent of its volume over the past 20 years, to excessive and illegal groundwater extraction, as well as diverting water from the once bountiful Zarrineh Rud—one of the lake’s main sources—to irrigate apple orchards.
Earlier, reports had surfaced about a change in the lake’s color. According to Lida Shojaifar, head of the Wetlands Conservation and Restoration Department of West Azarbaijan’s Environmental Protection Agency, the shift was attributed to high temperatures, increased evaporation, and heightened activity of salt-loving bacteria. Shojaifar described the phenomenon as natural and not alarming.
However, the complete drying of Lake Urmia raises concerns about the impact on local agriculture and tourism, which has already been damaged by the lake’s decline. Additionally, dust and salt storms from the lake bed now threaten the health of millions in the region.
The lake’s water level has been in steady decline for years, hitting a historic low of less than 1,270 meters in September 2023, eight meters lower than its peak level recorded in May 1995.
Despite earlier attempts to restore the lake, Arezou Ashrafizadeh, Director of the Wetlands Protection Office, warned in June that the situation remained fragile, even after seasonal water intake. "Despite adequate water intake this spring, Lake Urmia’s condition remains unstable and fragile," Ashrafizadeh said.
The drying of the lake has also reshaped its landscape. The evaporation has caused four of the lake’s southern islands to merge, forming land bridges and disrupting the habitat of local wildlife, including the Persian gazelle and Armenian wild sheep. This new landmass poses risks to both the animals and the delicate ecological balance of the lake’s former islands.
Additionally, the 1,250-meter-long Shahid Kalantari Highway, which bisects the lake, has been cited as a factor exacerbating the lake’s drying. The highway, built across the lake, divides it into northern and southern sections, potentially disrupting its natural flow and ecosystem.
Efforts to restore the lake’s water levels have thus far failed to meet expectations. Earlier plans projected that the water level would reach 1,274.1 meters by 2026. However, its fluctuating levels over the past two decades, driven by inconsistent rainfall and the management of water resources, have affected the lake's depth and topography.
Geological studies indicate that the fluctuations could also be impacting the region’s seismic activity. Two earthquakes, both with a magnitude of six, struck near Salmas in February 2020. More recently, a series of tremors hit Khoy between 2022 and 2024, coinciding with the lake’s drying out. Researchers are investigating the possible link between the seismic events and the lake’s water level changes.
A journalist, using the pseudonym Amir, told Shargh in a lengthy article on the subject that after his SIM card was deactivated, he could no longer make emergency calls and was left without any explanation. Upon inquiring with the prosecutor’s office, he was asked whether he had been previously arrested.
“They mentioned my prior arrests and limited political activity, telling me I would likely be contacted and required to sign a commitment (to desist). They said this could take up to a month,” Amir said. He also noted that all his digital services, including banking, had been disabled, upending his daily life.
This comes as Iran International reported on intensifying security measures around the first anniversary of the death of Mahsa Amini, whose death in police custody in 2022 ignited the largest ever nationwide protests against the Islamic Republic.
Another journalist, using the pseudonym Sepideh, shared with Shargh that her SIM card was deactivated in June following her posting of political content on social media. She said that after contacting the prosecutor’s office, she was compelled to delete several political posts and images of herself without a hijab and to sign a pledge. Her SIM card was then reactivated after three weeks.
A student activist, Shahram, also reported his SIM card was deactivated. Despite his efforts, he remains unaware of the specific reason for the block, suspecting the involvement of authorities.
Additionally, a journalist and writer, using the pseudonym Susan, told the daily that her SIM card was blocked for about two weeks ago without prior notice.
After reaching out to the Deputy of Cyberspace at the Prosecutor General’s Office, she was given another phone number and eventually summoned. She added that when she visited a security agency follow-up office, she was informed that her Instagram activity had been classified as “propaganda against the state,” and she would be contacted regarding her phone line or potential charges.
According to lawyer Payam Dorafshan, such actions are not new.
“Some prosecutors have issued broad directives to enforcement agents, allowing them to summon individuals by phone. If they do not comply, their bank accounts are first frozen, followed by the deactivation of their mobile services.” Dorafshan added that this practice forces citizens to comply with enforcement agencies, which act under judicial orders.
Dorafshan also pointed out that according to Iran’s legal framework, fundamental principles of fair legal proceedings, and the Islamic Penal Code, no citizen should be deprived of a fair trial process before a final ruling is issued. He said that blocking phone numbers can have far-reaching consequences, including the denial of basic civil rights and essential services like access to healthcare.
Shahla Orouji, a lawyer and member of the Central Bar Association, said that such punishments are not permitted by Iranian law.
“According to Article 36 of the Constitution, punishment must be issued by a competent court and according to the law. A judicial officer has no right to impose punishment.”
Since the establishment of the Islamic Republic, journalists, students, and civil activists critical of the government have faced various forms of pressure, including arrests, torture, imprisonment, and executions. The crackdown has intensified since the nationwide protests against the Islamic Republic erupted in September 2022.