Iran's Power Grid Crisis Deepens Amid Corruption and Aging Infrastructure

Iran, despite holding the world’s second‑largest natural‑gas reserves, is experiencing a severe electricity shortage that has led to nationwide blackouts, industrial shutdowns and growing public discontent. The U.S. Energy Information Administration reports a gap of about 12,000 MW in the summer of 2023, with domestic forecasts warning it could exceed 20,000 MW by 2025‑2026. Although the government cites an installed generation capacity of roughly 95,000 MW, the operational capacity has fallen to 70,000‑75,000 MW because many plants are decades old and suffer from poor maintenance.

Underinvestment over the past two decades has left key projects, such as the Sirik combined‑cycle plant in Hormozgan Province, stalled for years. Instead of modernising the grid, billions of dollars in oil revenue have been diverted to military and security institutions. The average efficiency of Iran’s thermal power stations is about 39%, far below modern standards, and transmission losses are estimated at 13% of generated electricity. A further strain comes from large cryptocurrency‑mining operations that receive subsidised power, intensifying shortages. Renewable sources contribute less than 7% of the nation’s electricity mix, leaving the grid heavily dependent on ageing fossil‑fuel plants.