Solar Incentives in Iraq: Zero Import Duties (2026)
Last updated: October 24, 2026 · Last verified: October 24, 2026
Iraq has spent 2026 removing the main cost barrier to importing solar equipment, while leaving the rules for connecting that equipment to the grid still in draft. This page tracks the country’s solar-related customs relief, financing support and the interconnection framework still pending approval.
Iraq Solar Incentives: Current Programmes
| Programme | Technology | Support type | Amount | Status |
|---|---|---|---|---|
| Solar equipment customs duty exemption (Council of Ministers decision) | Solar PV panels, inverters, cables, lithium batteries | Import duty exemption | 0% duty (down from 5% in February 2026; originally up to 33%) | OPEN — in force |
| Central Bank of Iraq household solar financing | Residential rooftop solar | Low-interest loan pool | 6 billion Iraqi dinars (≈$4.6 million), announced February 2026 | OPEN — ongoing, as reported |
From 33% to 5% to Zero: The Timeline
Iraq’s Council of Ministers decided to eliminate customs duties on imported solar energy equipment entirely, according to the state-run Iraqi News Agency (INA), completing a two-stage rollback of tariffs that stood as high as 33% at the start of 2026. The government first cut duties on solar panels, inverters, cables and lithium batteries to 5% in a decision Global Trade Alert dates to February 22, 2026, following a proposal from Electricity Minister Ali Saadi Waheeb. A technical proposal to eliminate the remaining 5% 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; INA reported the final step — removing the remaining 5% — in October 2026. INA described the measure as meant “to support the transition toward renewable energy sources and reduce the costs associated with acquiring such systems.” No expiry date has been disclosed for the zero-duty treatment.
The tariff relief ran alongside a separate financing step: Iraq’s central bank issued loans worth 6 billion Iraqi dinars (about $4.6 million) in February 2026 to help finance household solar purchases, announced at the same time as the first tariff cut.
Who Benefits and What’s Still Missing
The duty exemption applies to the equipment categories named in the Council of Ministers decision — PV panels, inverters, cables and lithium batteries — and benefits anyone importing that equipment into Iraq, from households and small installers to project developers; INA’s reporting does not name additional eligibility conditions beyond the equipment categories themselves. Cheaper imports address only one obstacle to adoption. Iraq’s Ministry of Electricity has drafted a 40-article regulation governing how rooftop and distributed solar systems connect to the national grid, including provisions for smart metering, but 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, and households installing panels today may still face an unsettled grid-connection process.
Market Context: A Small Base, Growing Fast
Iraq’s cumulative installed solar capacity stood at just 42 MW at the end of 2024, according to IRENA data — small next to the scale of its ambitions. That base is starting to shift: 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. The push also has an energy-security dimension: 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.
How Iraq’s Incentives Compare Regionally
Iraq’s move mirrors tariff and financing incentives other governments in the region 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 Gulf and North Africa. Unlike Turkey’s YEKDEM/YEKA model or Saudi Arabia’s NREP auction rounds, which support utility-scale generation through feed-in tariffs or competitive tenders, Iraq’s current package is narrower: it lowers the cost of acquiring equipment rather than guaranteeing a price for the power it generates.
Frequently Asked Questions
Does Iraq charge import duty on solar panels?
No, as of the Council of Ministers’ October 2026 decision, Iraq charges 0% customs duty on imported solar PV panels, inverters, cables and lithium batteries, down from 5% (set in February 2026) and an original rate of up to 33%.
What solar incentives does Iraq offer?
Iraq currently offers a full customs duty exemption on solar equipment imports and a Central Bank of Iraq loan pool of 6 billion Iraqi dinars (about $4.6 million) to help finance household solar purchases, announced in February 2026.
Can I connect rooftop solar to Iraq’s grid?
Iraq’s Ministry of Electricity has drafted a 40-article regulation covering rooftop and distributed solar grid connection and smart metering, but as of this page’s last verification that draft was still with the State Council for legal review and had not been approved by the Council of Ministers.
How much solar capacity does Iraq have?
Iraq’s cumulative installed solar capacity was about 42 MW at the end of 2024, per IRENA data, with new capacity coming online since, including a 1 GW project in Basra (61 MW in trial operation as of March 2026) and a 300 MW project in Karbala.
Related The Daily Energy Pages
- Iraq Fully Scraps Import Duties on Solar Equipment
- Solar Incentives in Turkey: YEKDEM to YEKA (2026) (Energy Incentives series)
- Home Battery Storage Incentives in Poland (2026) (Energy Incentives series)
- Section 45X: US Battery, Solar and Wind Manufacturing Tax Credit (2026) (Energy Incentives series)
- Saudi Arabia Energy Profile: Oil, Gas, Power (2026)
Sources
- Iraqi News Agency (INA), Council of Ministers decision eliminating remaining solar equipment customs duty, October 2026
- Global Trade Alert, record of Iraq’s February 2026 reduction of solar equipment customs duty to 5%
- pv magazine International, “Iraq slashes solar import tariffs to 5%,” March 4, 2026
- IRENA, renewable capacity statistics (Iraq solar, year-end 2024)
Illustrative image. Photo: Dr. Chinchu C., CC BY 4.0, via Wikimedia Commons — source
[…] completing a two-stage rollback of tariffs that stood as high as 33% at the start of the year. See Solar Incentives in Iraq: Zero Import Duties (2026) for the full incentive breakdown and financing […]