Institutionalizing management of water resources and systems is a realistic means for IS to expand its sources of funding and further legitimize itself among local populations. Unlike IS’s production of oil that (illegally) operates within a global market, water is a regional commodity that is largely dependent on the operation of local hydroelectric dams. For IS, these dams are “the most important strategic locations in the country,”says Shirouk al-Abayachi, a member of the Iraqi parliament and former adviser to the Ministry of Water Resources in Iraq. “They should be very well protected because they affect everything—economy, agriculture, basic human needs and security.”
In the ongoing conflict, the desire to command water is nothing new. IS’s quest to seize water infrastructure began in 2013 with the occupation of the Tabqa Dam, Syria’s largest hydroelectric dam that supplies electricity to rebel and government territories, including the city of Aleppo. Advancing toward a hydraulic state during its invasion of Fallujah, IS effectively employed surrounding dams, canals, and reservoirs as weapons—denying water to areas outside of its territory and flooding the route of the approaching Iraqi army. And in the eastern Syrian city of Raqqa, IS exhausted water reserves and disrupted distribution networks, forcing residents to rely on untreated water sources and leading to the spread of waterborne diseases such as Hepatitis A and typhoid.
Although other actors, including the Bashir al-Assad regime and Syrian rebel groups, target water systems and strategically withhold aid, IS’s endeavors have the potential to inflict greater damage. This was evident in the organization’s occupation of the Mosul Dam, Iraq’s largest hydroelectric facility that supplies water and electricity to the majority of the country and is considered “the most dangerous dam in the world.”A 2006 U.S. military survey concluded that its collapse would release a twenty meter-high wave on the city of Mosul, which could destroy the city and kill over fifty thousand people. During its occupation, IS ultimately did not have sufficient forces to sustain its control, and the dam was reclaimed by Kurdish forces with the help of U.S. airstrikes in August 2014. While the annexation of the Mosul Dam did not end in a devastating collapse, IS sufficiently damaged the region by failing to perform basic state functions—reports claimed that the city experienced dire shortages of water and food, and near economic collapse during the occupation. IS did, however, employ destructive flooding in the April 25 seizure of the Tharthar Dam near Fallujah. U.S. intelligence reports suggest that IS has opened at least one of the dam’s gates to flood nearby areas following an attack which reportedly killed 127 Iraqi troops.
Reckless behavior in Fallujah, Raqqa, and Mosul are indications that IS does not possess the resources needed to employ soft power governance through the management of the region’s technologically intensive infrastructure. Unlike IS’s common forms of funding, such as cash from the plunder of antiquities and kidnappings for ransom, wealth accrued from the command of resources like oil and water is contingent upon infrastructural planning and a skilled workforce. Supervision of dams requires a highly specialized skill set, and, according to Russell Sticklor, a water researcher for CGIAR, “there is no indication that the Islamic State possesses it.”Rather than initiate its own civil workforce, IS has borrowed skilled labor from its predecessors—the Assad Regime and government in Bagdad continue to pay many engineers and skilled workers operating under IS supervision.
Here is also a good reference source for discussion of the economic infrastructure of Islamic State