Iraq plans to spend up to $1.6 billion on solar and wind power stations over the next three years to add 400 megawatts to the national grid to help curb daily blackouts, an official from the ministry of electricity said on Monday.

Nine years after the US-led invasion that toppled Saddam Hussein, investment is needed in most of Iraq's industries, not least power generation, which produces just 8,800 MW of the 14,000 MW needed.

The dilapidated national grid supplies only a few hours of power a day, leaving Iraqis to swelter in the summer months, when temperatures can top 50 degrees Celsius.

Invitations have been sent to about 25 leading companies to manufacture and install solar and wind power plants, said Laith al-Mamury, the head of the planning and studies department at the ministry of electricity.

The companies include Japan's Toyota Tsusho Corp, Swiss engineering group ABB and Egypt's Orascom Construction .

The ministry has allocated an initial $200 million from the 2013 budget to add 50 MW to the grid next year, focusing on deserted and border areas, Mamury said.

Solar energy is rare in Iraq, expect for lighting on some of its main streets.

The ministry has plans to reach 22 gigawatts of power generation capacity to meet demand in 2016 by upgrading and building new power projects to solve the chronic shortages.

Mamury said each megawatt of solar or wind energy cost around $3.5-$4 million, but the initial outlay would be offset by lower running costs because the stations do not need fuel to operate.

In the long term, the aim is for solar and wind energy to account for 2 percent of power generation volume, Mamury said

Opec member Iraq has the world's fourth-largest oil reserves and is producing more than 3 million barrels per day (bpd) for the first time in three decades.

"It is true that we are an oil country but we should save oil for the coming generation not only sell it or burn it," he said.-Reuters