Iran’s perfect storm of domestic failures

With a policy of maximum support for the Iranian people, the US can help them decide their country’s future as they grapple with the ongoing energy and environmental crisis.

How bad is the crisis? The government now posts schedules for blackouts in some neighborhoods with two daily outages lasting two hours each, three days a week. In reality, the cuts hit without warning and leave people scrambling.

Social media is overflowing with videos showing food rotting in dead refrigerators, parents trying to comfort crying children in stifling heat, shopkeepers stuck in dark stores and factories slashing production.

Blackouts may seem absurd in a nation that sits on the second-largest natural-gas reserves in the world and gets some of the strongest sunlight on Earth.

But the electrical grid is old, the plants are inefficient and fuel supplies are a constant headache. Experts inside the country say it would take $30 billion and three to four, or more, years to modernise the system.

Solar farms could be built in a year, but for a regime that’s already broke, neither option is on the table. Instead, they’ve gone for the cheapest “fix” – mass blackouts that shift the pain onto the public.

More than 40 cities face routine water rationing, with at least 19 provinces under severe water stress. Iran records more than 1,700 heat-related deaths each year, nearly five times the regional average.

In late July, protests erupted in industrial and agricultural hubs where power and water cuts directly threaten livelihoods. Demonstrators and regime outlets alike hold government institutions responsible, citing policies that enrich elites at the expense of the environment, including politically driven dam projects that lack proper environmental reviews or long-term planning.

This convergence of crises is also exacting a heavy economic toll in the country. Repeated power cuts have crippled auto manufacturing, with many companies temporarily shutting down or laying off hundreds of workers.

Outages have halted operations at refineries, threatening supplies of gasoline, motor oil and other petroleum products. Industrial power is now cut three days a week, with smaller factories unable to afford generators. The government itself admits the industrial sector is losing $100 million every day. It’s a grim, avoidable collapse.

Tehran typically blames Western sanctions for economic distress, but even regime-aligned outlets, from those tied to the supreme leader Ali Khamenei to the reformist camp, are blaming government mismanagement as the chief cause of the crisis.

The incompetence and corruption are simply too apparent, from failing to store gas for power plants to maintaining wasteful subsidies instead of reforming the regulatory system that has left the grid and aquifers in collapse.

Unsurprisingly, the Islamic Republic’s priorities are at odds with those of its population. Humiliated by setbacks suffered during the war with Israel and more isolated than ever, the regime refuses to abandon its nuclear weaponisation ambitions, halt missile development or cut funding to militias.

Instead, it’s preparing for the next conflict with Israel. As one member of parliament’s National Security Commission bragged: “Despite the water and electricity problems, we are ready to enter another war.”

Protests are sporadic, not from lack of outrage but because of the regime’s brutal crackdowns.

Executions of political prisoners have surged since the war, with about 70 now on death row. And authorities claim to have arrested 21,000 people during the conflict with Israel. Yet, even without street protests, these quality of life and economic issues fuel political unrest in Iran, as happened in 2017 and 2019.

With all these crises coming together, and with a reimposition of massive sanctions looming, even regime officials concede the Islamic Republic faces an existential threat. The question is not whether there will be new waves of unrest filling Iran’s streets, but when.

As new upheaval inevitably takes shape, Washington should pursue a strategy in alignment with the domestic protesters, offering diplomatic support for dissidents and giving people unimpeded Internet access supplemented by an amplified communications campaign.

This is not to dictate outcomes but to ensure Iranians themselves chart the course of change.

Navid Mohebbi is a Washington, DC-based expert covering Iran's foreign and domestic policy

Janatan Sayeh is a research analyst at the Foundation for Defense of Democracies focused on Iranian domestic affairs and the Islamic Republic’s global influence.