Private generator owners strike leaves Baghdad in the dark

ERBIL, Kurdistan Region - Private generator owners in Iraq’s capital announced a strike late Monday which has resulted in a blackout in Baghdad neighborhoods overnight, in what owners claim is a response to governmental retroactive taxes. 

In the pitch-dark streets of a Baghdad neighborhood, children are running about, and adults have gathered around to chat amid a blackout. Owners of private generators have gone on strike, citing new governmental regulations on taxes and lack of fuel. 

"Today, I officially turned off my generators. Do you see these three barrels of diesel? They are all empty. Not even a drop. I am forced to turn off the generators,” Hashem Yassin, a private generator owner, told Rudaw’s Shko Omer while his three private generators sat idly.  

“I call on the government to cancel retroactive taxes. If they want tax, they should start from this year," he said. 

Private generator owners say the issue goes beyond the government’s inability to provide them with diesel at subsidized rates. 

"They wait until the end of the month to provide us with fuel. For example, I was provided a share on the 22th of August. I should be able to get my share again on 22nd of September, not the end of September,” said Ahmed Haider, private generator owner. 

“We also have issues in terms of taxes. They want taxes from when I was first issued my license, as in 2005 or 2006. That would amount to 125 to 130 million dinars," he stated. 

Iraq sustained heavy economic losses due to the closure of the Strait of Hormuz, where more than 90 percent of Iraq’s oil is exported and whose revenues fund around 84 percent of its federal budget, following a joint US-Israeli aerial campaign against Iran on February 28.
 
Oil exports dropped from monthly 100 million barrels to less than 20 million in the subsequent months and have yet to recover. Amid this sharp drop, the government is dealing with a crippling financial standing. 

In an effort to mediate the shortage, the government has resorted to levying taxes and cutting back on subsidies. 

On top of tax arrears, generator owners also protest a government decision that would require them to register employees for social security. 

“Our generators have run out of diesel. They have been turned off. We don't even have the funds to buy from the private market. On top of all of that, they ask that we register our workers for social security. There is frequent turnover among our workers, so we won't have time to register them. The government's demands are difficult, and we can't implement them,” Hussein Allawi, another private generator owner, said. 

Locals, who are the most impacted, say they stand behind the private generator owners. 

Ahmed Abbas, a local, told Rudaw, “We call on the government to either provide electricity or provide diesel to generators and to decrease taxes and procedures against them.”

Sabah Jassim, another local, posited, “The generator owners have never done wrong by us. We are all one people here. I have no complaint about the generators and have done no wrong. All neighborhoods are happy with them."

To alleviate the unstable national grid and frequent blackouts, Iraq operates a dual-system, whereby private generators supplement the hours where national electricity is off. 

Speaking to al-Rabiaa radio channel on Monday, Dhargham al-Shiwayli, head of the Syndicate of Private Generators of Iraq, said they weren't turning off generators, but rather the generators were going to turn off on their own due to running out of diesel. 

In a statement on August 31, Iraq’s Oil Ministry responded to the syndicate head and said it maintains the legal right against any statement “that was not true and that could cause confusion.” 

The ministry said it had provided, through the months of June, July, and August, a total of 1.2 million liters of diesel free of charge for all kilovolt-amperes for July and August and at 200 dinars per liter in June. 

“The Ministry of Oil places extreme importance on providing owners of generators with diesel, as the Ministry has proven in the last two decades,” the Ministry said in its Monday statement. 

Importantly, Iraqi Prime Minister Ali al-Zaidi on Tuesday directed authorities to provide generators with subsidized diesel for September at 400 dinars per liter, at 40 liters per kilowatt hour “throughout the current month of September… no less than 20 hours per day, between the national grid and private generators, to ensure sustainability and stability in the provision of electricity to citizens,” a statement from the PM's office read.