Repeated power outages cripple Iranian industries

An Iranian lawmaker has warned that the country's ongoing power outages are severely affecting industries, contradicting the government's earlier assurances that there would be no more outages this summer.

"Despite promises, three years into the current administration, we are still witnessing power outages which have severely disrupted the economy and brought about numerous crises," said Mohammad Reza Rezaei Kouchi.

Kouchi also noted that the onset of summer and the subsequent surge in peak electricity consumption "have increased production costs, ultimately impacting everyone."

In response to criticism from the private sector regarding the power outages, the Ministry of Energy has stated that the issue falls under the jurisdiction of security agencies, not the government.

Conversely, an official at the Iran Chamber of Commerce told the semi-official ILNA that one-day power outages in industrial parks, mandated by the Ministry of Energy, have become a standard practice despite being illegal.

The official also noted that these outages are sometimes extended to two days a week.

Iranian media reported that a new record was set yesterday with an unprecedented demand of 77,151 megawatts, necessitating extraordinary measures to maintain grid stability.

The country is currently grappling with a severe energy deficit crisis, worsened by the summer heat and the government's failure to meet natural gas and electricity production targets.

Iran has been unable to boost natural gas production although it has the world's second largest reserves. Meanwhile, extremely low energy prices, subsidized by the government, encourage persistent increase in consumption.

Reports of power outages affecting residential areas, including Tehran and Isfahan, have also emerged.

Media sources indicate that the residential grid experienced unannounced cuts despite temperatures exceeding 50 degrees Celsius.

Khabar Online reported that power cuts in some central Tehran areas have extended to four hours, compared to the previous maximum of two hours during hot seasons.

Reports indicate that the power supply situation in southern provinces is even more critical, leading to the closure of some government offices.

Power outages have become a significant industry issue, causing considerable disruption and drawing complaints from business owners.

This week, electricity at the Saipa automotive factory was cut for at least five hours, severely affecting production.

Persistent power cuts have caused significant disruptions in Tehran's industrial hub. The newspaper "Donya-e-Eqtesad" reported that the electricity crisis has escalated from media warnings to SMS alerts to citizens. Each outage severely impacts industries, taking about 24 hours to restart operations, thereby increasing losses.

Dalga Khatinoglu, an oil, gas, and economic analyst, noted instead of addressing the fundamental energy imbalance, authorities have opted to reduce electricity and gas to industries—a short-term solution that fails to resolve the country's energy deficit.

Additionally, many of Iran's power plants are inefficient gas or steam types. Instead of modernizing the grid or converting to more efficient combined-cycle plants, the government has opted to adjust office hours and impose restrictions on industrial power supply.