Mohammad-Jafar Qaem-Panah described Bushehr Province during a visit as one of Iran’s main energy hubs. He noted that 73 percent of the nation’s gas comes from South Pars and that Kharg Island — the country’s most important oil-export terminal — is located in the province.

He said the administration began its term facing serious energy imbalances. “Last year around this time, many regions experienced blackouts. Eighty percent of industry was shut down. Power plants lacked enough diesel fuel, forcing us to rely more on natural gas,” he said. “Using more gas reduced the share available for power plants, and we had to balance between blackouts and rising household consumption.”

Qaem-Panah said power plants struggled because they are designed to run on dual fuel. “We got through last year with difficulty,” he said, adding that the government is now working to expand solar capacity. Bushehr currently produces 70 megawatts of solar power, up from 4 megawatts previously. “Our plan focuses on consumption management and expanding solar energy,” he said.

Budget Deficit and Gasoline Imports Fuel Inflation

Qaem-Panah said people feel the effects of inflation directly and that the president has stressed that both the government and Parliament contribute to price increases. “When government expenses rise and revenue falls short, we are forced to print money — and that means inflation,” he said. “One factor in the budget deficit is gasoline.”

He noted that in previous years Iran exported $6 billion in gasoline annually, but today it must import the same amount. “That’s 600 trillion tomans — equal to the country’s entire annual development budget,” he said. “For example, the Bushehr–Shiraz railway alone needs 100 trillion tomans. If we had spent 600 trillion on gasoline imports, inflation would have surged, putting the greatest pressure on vulnerable groups.”

After extensive discussions, he said, the government made a small increase to the price of the 40 percent of daily gasoline consumption not covered by subsidized quotas. The 60- and 100-liter quotas remain unchanged, but the pump price using a station card rose from 3,000 to 5,000 tomans per liter.

5,000-Toman Gasoline for Government Vehicles

Qaem-Panah said the decision was reviewed for months to avoid economic shock. Starting immediately, all government vehicles must use gasoline priced at 5,000 tomans. “About 180,000 government-owned or government-plated vehicles must pay this rate, while the public’s quota remains unchanged,” he said.

In free-trade zones, imported cars and new vehicles must also buy gasoline at 5,000 tomans per liter. Revenue from the price change will not go to the treasury, he said. “Surveys showed people’s top concerns are basic living costs and food prices. The president ordered that not a single rial of this money go to the treasury — it must all support the e-voucher program.”

He said the government issued 26 trillion tomans in vouchers under the previous administration and 100 trillion under the current one. Four rounds of vouchers have been provided for the first seven income deciles. “The gasoline price difference will also be allocated to vouchers,” he said.

Gas Consumption, Energy and the Environment

Qaem-Panah said reducing natural gas consumption helps ensure feedstock for petrochemical plants and prevents raw-material exports. He noted that in other countries, household temperatures are set at 23 to 25 degrees Celsius, even in hotels. “The president does not turn on any lights in his office during the day,” he said, adding that the Presidential Office has cut electricity use by 13 percent. In one building, the number of lobby lights was reduced from 700 to 27.

Gas prices for high-consumption households rise progressively, he said, while cold-climate regions and vulnerable families see little or no increase. “But villas and large homes must pay more,” he said. Iran’s maximum gas-production capacity is about 830 million cubic meters per day. “We cannot produce more. Otherwise, we would have to shut down industries, which leads to unemployment and inflation.”

Qaem-Panah said power-plant fuel oil was made low-sulfur this year with help from the Oil Ministry to reduce pollution. Old vehicles remain a major source of emissions, he said, and Iran must move toward wind and solar energy. He added that gas flares in Bushehr and Ahvaz will meet standards within two years.