Pay now or pay later . . .

**Shek** · 05-01-2006, 08:49 AM

I don't get why we look at these reconstruction projects as being so expensive. We're spending upwards of $7-8bn USD a month on operations in Iraq. The goodwill that would have been generated (no pun intended) had we sunk in the required $20bn USD two years ago would be coming on line right now. This is what happens when you try to do things on the cheap.

Quote:

Washington Post
May 1, 2006
Pg. 15

New Iraqi Power Plant Feeds A Feeble Grid

Rising Demand, Attacks on Infrastructure Limit Impact of U.S.-Funded Project

By Nelson Hernandez, Washington Post Staff Writer

KIRKUK, Iraq, April 30 -- V94, known to U.S. officials as the "mother of all electricity generators," stands four stories tall and is surrounded by a silvery forest of transformers, an island of modernity amid the dust-streaked farmlands and medieval mud-brick houses of the northern Iraqi countryside.

The Kirkuk power plant, which became fully operational a month ago, is a $178 million chunk of the more than $18 billion the United States has spent in rebuilding Iraq. It is the most powerful and sophisticated electric plant in the Middle East, according to its Iraqi plant managers and U.S. officials who gave reporters a tour of the site Sunday morning. Its two gas-fired turbines, V94 and V64, generate a combined 325 megawatts to Iraq's national power grid -- enough, in theory, to give Iraqis an extra three hours of electricity each day.

But mending Iraq's power grid -- one of the most important tasks of the reconstruction effort -- has proved as difficult and intractable as defeating insurgents or controlling ethnic and sectarian rivalries. Hundreds of millions of dollars and massive projects -- such as the construction of the Kirkuk plant, which began in January 2004 -- have made hardly a dent in the problem, even as the United States begins to shift responsibility for Iraq's reconstruction to the national government.

Forced to deal with an aging, poorly maintained electricity infrastructure, ongoing insurgent attacks on gas and transmission lines, and the ever-increasing demand of Iraqis, Iraq still averages only about 13 hours of electricity a day nationwide, with only six hours on average in Baghdad, the country's largest population center, according to U.S. officials. Iraqis consider the lack of power to be among their most serious problems, especially during the summer, when temperatures can top 120 degrees.

Before the U.S.-led invasion in 2003, Saddam Hussein's government routed power to Baghdad, which received 18 to 24 hours of electricity a day while the rest of the country received two to four hours. Since then, Iraq's electricity generation capacity has increased from 2,500 megawatts to approximately 5,000 megawatts, but attacks and maintenance problems have kept another 3,500 megawatts offline.

The problems start at the oil and natural gas refineries that provide fuel for the electricity generators. Attacks on the plants or pipelines can cut off the fuel supply or reduce its quality. Then there are attacks on the generating plants themselves. Finally, insurgents have targeted transmission lines, which stretch for more than 10,000 miles.

U.S. and Iraqi forces have tried to secure the plants and their lines, and cite some success as in a decline this year in attacks on pipelines.

Maintenance problems also contribute to power shortages. Refineries and generators received little maintenance under Hussein, and much of the U.S. spending has gone toward urgently needed repairs.

Although the work has improved the overall generating capacity, the increasing demands of Iraqis have outstripped the increasing supply. Before 2003, when the country was under U.N. sanctions, electricity-guzzling appliances such as air conditioners were too expensive for many Iraqis. When the sanctions ended with the fall of Hussein, consumer goods flooded the market. The demand for electricity is expected to hit 10,000 megawatts this summer -- almost twice what the overtaxed system can provide.

"Demand is increasing by 15 percent a year," said John Dempsey, a consultant to Iraq's Electricity Ministry.

All of which makes the Kirkuk plant a small step on a long road. Daniel Speckhard, the U.S. Embassy official who directs the Iraq Reconstruction Management Office, said he had heard that the complete rebuilding of the electrical grid, to the point where it could provide continuous power, could cost as much as $20 billion.

Speckhard described the Iraqi government's plan to make major improvements to the electricity infrastructure within five years as "feasible but optimistic."

The U.S. role in that project, he said, would be limited. "We're not going to be doing new construction projects, but we will continue to fund sustainment," he said. "We're going to help Iraq do its own programs and infrastructure development. I think that's part of the transition to self-reliance."

indianguy4u · 05-01-2006, 09:04 AM

Thats b'coz Haliburton & other US contractors were given deals on the platter by US admin instead of transperent global bids. I would like to know how many $$$ do a normal iraqi living in iraq get for his work?

Bluesman · 05-01-2006, 09:16 AM

I just KNEW it! Haliburton is the reason Iraq is not finished yet. Why, I bet if the Sierra Club had been in charge, the place would look like Switzerland by now.

Please.

**TopHatter** · 05-01-2006, 09:36 AM

Well, we've got a creaking ancient power grid here in the U.S. as well.

So what the heck are the Iraqis complaining about??

**Shek** · 05-01-2006, 09:47 AM

Quote:

Originally Posted by indianguy4u

Thats b'coz Haliburton & other US contractors were given deals on the platter by US admin instead of transperent global bids. I would like to know how many $$$ do a normal iraqi living in iraq get for his work?

Which really doesn't have that much to do about it, although your assertion is false since there were/are several nations and non-US firms involved in the electrical grid projects. The issue is not who is doing the work on the electrical, but the $$ set aside to do the work.

As far as your Iraqi earnings question, you have to give a sector so that a person can answer it. Otherwise, the question is too broad.

If you are implying that Iraqi firms should have been hired to do the electrical work, it is simply beyond their capacity because their hands on experience is based on inefficient 1960s/1970s technology that is outdated and not fully appropriate for their natural resource capabilities.

indianguy4u · 05-01-2006, 09:57 AM

My assertions were in general, not related to this project only. Its now 3 yrs to US occupation but hardship of civilians isnt getting less either on voilence side or economic side.

**Shek** · 05-01-2006, 10:07 AM

Quote:

Originally Posted by indianguy4u

My assertions were in general, not related to this project only. Its now 3 yrs to US occupation but hardship of civilians isnt getting less either on voilence side or economic side.

Okay, your assertions there are also not fully valid, as the reconstruction projects are not wholly American, especially those where the Iraqis have the appropriate capabilities. As far as the economic hardships, your assertion also falls flat based on the huge inflow of consumer goods following April 2003 and the rise in GDP, some of which is oil induced. That isn't to say that reconstruction's been a rousing success, but it has improved the infrastructure beyond the capability that Saddam provided DESPITE targeted attacks against it by insurgents.

Your violence assertion would be the only one to hold.

indianguy4u · 05-01-2006, 10:14 AM

Quote:

Originally Posted by shek

Okay, your assertions there are also not fully valid, as the reconstruction projects are not wholly American, especially those where the Iraqis have the appropriate capabilities. As far as the economic hardships, your assertion also falls flat based on the huge inflow of consumer goods following April 2003 and the rise in GDP, some of which is oil induced. That isn't to say that reconstruction's been a rousing success, but it has improved the infrastructure beyond the capability that Saddam provided DESPITE targeted attacks against it by insurgents.

Your violence assertion would be the only one to hold.

Do we have any proper bifurcation between the consumption induced by US forces & that of iraqis? Seeing CNN reports from iraq, the picture doesnt look rosy.

Wasnt german, french, russian Cos barred from bidding for reconstruction contracts?

**Shek** · 05-01-2006, 10:21 AM

Quote:

Originally Posted by indianguy4u

Do we have any proper bifurcation between the consumption induced by US forces & that of iraqis? Seeing CNN reports from iraq, the picture doesnt look rosy.

Wasnt german, french, russian Cos barred from bidding for reconstruction contracts?

Question #1, see the World Bank Report for background information. The answer is that consumption by US forces isn't driving anything other than concrete and some steel, although Iraqis are buying those items for the very same reasons plus for construction projects of their own. The increased demand on the electrical grid is all Iraqi based, as US installations use generators that aren't dependent on the national grid.

Question #2, yes. However, there were still companies from some of those countries that were hired as subcontractors. I made a post a while back criticizing this decision - while it may make an American feel good in the sense of "we sure showed them", it was foolish and lessened the chance of any buy in from these countries.

**Shek** · 05-01-2006, 10:24 AM

Quote:

Originally Posted by indianguy4u

Seeing CNN reports from iraq, the picture doesnt look rosy.

News organizations don't make money selling feel good stories. That isn't to say that Iraq is one great big success story, but it's not the hell hole that watching the tube will give you the impression of.

Confed999 · 05-01-2006, 23:45 PM

Quote:

Originally Posted by shek

I made a post a while back criticizing this decision - while it may make an American feel good in the sense of "we sure showed them", it was foolish and lessened the chance of any buy in from these countries.

They were supplying the enemy. They didn't get it bad enough as far as I'm concerned...

05-01-2006, 09:04 AM	#2 (permalink)
indianguy4u Real Madrid CF *Senior Contributor* Join Date: 03-07-05 Location: Mumbai Posts: 3,213 Country:	Thats b'coz Haliburton & other US contractors were given deals on the platter by US admin instead of transperent global bids. I would like to know how many $$$ do a normal iraqi living in iraq get for his work? __________________ Hala Madrid!!

05-01-2006, 09:16 AM	#3 (permalink)
Bluesman WAB Bartender *Defense Professional* *Military Professional* Join Date: 11-24-04 Location: Vacaville, CA. Posts: 7,435 Country:	I just KNEW it! Haliburton is the reason Iraq is not finished yet. Why, I bet if the Sierra Club had been in charge, the place would look like Switzerland by now. Please. __________________ "The quickest way of ending a war is to lose it, and if one finds the prospect of a long war intolerable, it is natural to disbelieve in the possibility of victory." - George Orwell

05-01-2006, 09:36 AM	#4 (permalink)
TopHatter Administrator Join Date: 09-03-03 Location: Fort Myers FL Posts: 9,789 Country:	Well, we've got a creaking ancient power grid here in the U.S. as well. So what the heck are the Iraqis complaining about?? __________________ If your actions inspire others to dream more, learn more, do more and become more, you are a leader. ~John Quincy Adams

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05-01-2006, 09:57 AM	#6 (permalink)
indianguy4u Real Madrid CF *Senior Contributor* Join Date: 03-07-05 Location: Mumbai Posts: 3,213 Country:	My assertions were in general, not related to this project only. Its now 3 yrs to US occupation but hardship of civilians isnt getting less either on voilence side or economic side.

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