TEHRAN (Realist English). Iran is accelerating the rollout of solar energy projects in an effort to curb severe electricity shortages caused by decades of underinvestment, aging infrastructure, and the impact of U.S. sanctions.
Tehran hopes to ease its energy crisis, which forced the government to reintroduce rolling blackouts this year despite Iran holding the world’s third-largest oil and second-largest natural gas reserves.
“Renewable energy development has evolved from a supportive policy to a strategic necessity,” said Mohsen Tarztalab, deputy energy minister, at a solar energy conference in Tehran last week. “Expanding clean energy is central to achieving energy security and reducing Iran’s reliance on fossil fuels.”
Iran’s grid, heavily dependent on natural gas — which generates roughly 80% of its electricity — has struggled to meet rising demand. The country is now betting on renewables, but analysts remain skeptical that its strained economy can deliver on its ambitious targets given limited access to foreign investment and global financing.
The Renewable Energy Organization of Iran aims to reach 12GW of renewable capacity within three years, up from the current 2.5GW, which accounts for just 2.5% of total power generation — far below Turkey’s 16.3% share from solar and wind power.
President Masoud Pezeshkian said his government is ready to work with private companies to speed up construction. “All contracts for the construction of solar plants can be implemented within one year,” he said during an online ceremony to inaugurate new capacity. “We must ensure that no factory faces power shortages next summer.”
Electricity cuts have repeatedly disrupted production and cost Iran’s industries billions of dollars in damages. During the peak summer season, the national grid faced a shortfall of 15GW, forcing renewed blackouts across major cities.
To help bridge the gap, Iran’s sovereign wealth fund announced in July a $2.3 billion investment to build 7GW of renewable capacity in partnership with the private sector, which will contribute about 20% of total funding.
Experts note that Iran, with roughly 300 sunny days per year, has vast solar potential. Yet Moslem Mousavi, head of the Iran Renewable Energy Association, cautioned that the country’s “contracting capacity is limited,” making it unlikely that targets will be met on schedule. “Even with new plants, the supply gap will remain unless consumption is optimized and efficiency improves,” he said.
The government is encouraging households to install rooftop solar panels, offering loans and buyback options for surplus electricity. Pezeshkian said a 10% reduction in energy use could save the equivalent of 800,000 barrels of oil and gas daily.
Iran’s solar industry depends heavily on imports from China, the world’s largest supplier of solar equipment. But the country’s economic instability — exacerbated by the June conflict with Israel, U.S. airstrikes on Iranian nuclear sites, and the reimposition of UN sanctions — has sent the rial plunging, further driving up import costs.
“Sanctions affect financing and raise costs while deterring foreign investment,” Mousavi said. Before the U.S. withdrawal from the 2015 nuclear deal, foreign investors had pledged more than $4 billion for renewable projects — funds that never materialized.
