Iraq Fully Scraps Import Duties on Solar Equipment

Iraq’s Council of Ministers has decided to eliminate customs duties on imported solar energy equipment entirely, the state-run Iraqi News Agency (INA) reported, completing a two-stage rollback of tariffs that stood as high as 33% at the start of the year.

From 33% to 5% to Zero

The government first cut duties on solar panels, inverters, cables and lithium batteries to 5% in February 2026, a move Global Trade Alert dates to February 22. That reduction followed a proposal from Electricity Minister Ali Saadi Waheeb, and came alongside a separate step by Iraq’s central bank, which issued loans worth 6 billion Iraqi dinars (about $4.6 million) to finance household solar purchases earlier the same month.

The latest decision removes the remaining 5% altogether, according to INA, which said the measure is meant “to support the transition toward renewable energy sources and reduce the costs associated with acquiring such systems.” A technical proposal to eliminate the fees completely had been under review since at least July 2026, when the head of Iraq’s National Team for Renewable Energy flagged it as a live option.

Grid Rules Still in Draft

Cheaper imports address only one obstacle to Iraqi households and businesses adopting solar power. The Ministry of Electricity has also drafted a 40-article regulation governing how rooftop and distributed solar systems connect to the national grid, including provisions for smart metering. That draft is still with the State Council for legal review before it can go to the Council of Ministers for approval, meaning the interconnection framework lags the tariff relief by several steps.

Iraq’s solar base remains small relative to its ambitions. The country’s cumulative installed solar capacity stood at just 42 MW at the end of 2024, according to IRENA data, though that is set to change: Iraq’s first solar-module production line opened in Karbala governorate in July 2026, and construction is underway on a 300 MW project in the same governorate, whose 22 MW first phase went live in September 2025. In Basra, a planned 1 GW solar project — the country’s largest under development — entered trial operation in March 2026 with 61 MW switched on.

Part of a Wider Regional Push

Iraq’s move mirrors tariff and financing incentives other Gulf and North African governments have used to accelerate solar adoption, from the UAE’s and Saudi Arabia’s utility-scale tenders to smaller import-friendly tweaks elsewhere in the region. It also comes as Iraq continues to rely heavily on gas and electricity imports from Iran to cover shortfalls in domestic generation — a dependency Baghdad has repeatedly said it wants to reduce, making cheaper solar imports as much an energy-security measure as an environmental one. Elsewhere in the region, UAE-based Masdar and EWEC have pushed ahead with round-the-clock solar-plus-storage projects, while development finance institutions such as Norway’s Norfund have taken equity stakes in solar projects elsewhere in the Global South to help bring down financing costs — a model Iraq has yet to tap at scale.

Sources

• pv magazine, “Iraq removes import tariffs on solar systems,” October 22, 2026 — Council of Ministers decision, INA statement and grid-regulation details, citing the Iraqi News Agency.
• Global Trade Alert, intervention record on Iraq’s February 2026 customs duty reduction — effective date and scope of the initial 5% cut.

Illustrative image. Photo: Dr. Chinchu C., CC BY 4.0, via Wikimedia Commons — source