Controversy Surrounds Central Bank’s Solar Energy Loan Program
On March 17, 2025, economist Haider Al-Sheikh ignited a significant debate regarding the loans issued by the Central Bank of Iraq aimed at facilitating the purchase of solar energy systems. He highlighted discrepancies between the loan conditions and the government’s assurances of providing more accessible options for citizens.
Al-Sheikh emphasized that the added interest, which can reach up to 3 million dinars, imposes an additional financial burden on citizens rather than offering meaningful support. He also raised concerns about the performance of these solar systems, stating that while they operate effectively during the day, they only supply electricity for a limited number of hours at night, undermining their role as a viable alternative to the national electricity grid.
In light of these challenges, Al-Sheikh urged the government to implement an electronic platform enabling citizens to purchase solar energy systems directly, eliminating the intermediary roles of companies and banks. He proposed that the interest rate on these loans should not exceed 1% to maximize societal benefits and facilitate the transition to clean energy.
Iraq is currently grappling with a persistent energy crisis characterized by frequent outages in the national power supply, prompting citizens to seek alternative solutions, notably in solar energy.
Despite the government’s commitment to support this sector through soft loans originated from Central Bank funding, a myriad of challenges has surfaced. These include the high cost of solar systems relative to individual incomes and the burden of banking interest rates.
Economic specialists continue to advocate for more transparent processes, such as the creation of electronic platforms to enable direct purchase of solar energy systems without intermediaries. Additionally, they recommend lowering interest rates to enhance public access to this sustainable technology, ensuring that it can serve a broader demographic effectively.
