minitech is right in that animation-delay specifies the delay before the animation starts and NOT the delay in between iterations.  The editors draft of the spec describes it well and there was a discussion of this feature you're describing here which suggesting this iteration delay feature.
While there may be a workaround in JS, you can fake this iteration delay for the progress bar flare using only CSS.  
By declaring the flare div position:absolute and the parent div overflow: hidden, setting the 100% keyframe state greater than the width of the progress bar, and playing around with the cubic-bezier timing function and left offset values, you're able to emulate an ease-in-out or linear timing with a "delay". 
It'd be interesting to write a less/scss mixin to calculate exactly the left offset and timing function to get this exact, but I don't have the time at the moment to fiddle with it.  Would love to see something like that though!
Here's a demo I threw together to show this off.  (I tried to emulate the windows 7 progress bar and fell a bit short, but it demonstrates what I'm talking about)
Demo: 
http://codepen.io/timothyasp/full/HlzGu
<!-- HTML -->
<div class="bar">
   <div class="progress">
      <div class="flare"></div>
   </div>
</div>
/* CSS */
@keyframes progress {
  from {
    width: 0px;
  }
  to {
    width: 600px;
  }
}
@keyframes barshine {
  0% {
    left: -100px;
  }
  100% {
    left: 1000px;
  }
}
.flare {
  animation-name: barshine;
  animation-duration: 3s;
  animation-direction: normal;
  animation-fill-mode: forwards;
  animation-timing-function: cubic-bezier(.14, .75, .2, 1.01);
  animation-iteration-count: infinite;
  left: 0;
  top: 0;
  height: 40px;
  width: 100px;
  position: absolute;
  background: -moz-radial-gradient(center, ellipse cover,  rgba(255,255,255,0.69) 0%, rgba(255,255,255,0) 87%); /* FF3.6+ */
  background: -webkit-gradient(radial, center center, 0px, center center, 100%, color-stop(0%,rgba(255,255,255,0.69)), color-stop(87%,rgba(255,255,255,0))); /* Chrome,Safari4+ */
  background: -webkit-radial-gradient(center, ellipse cover,  rgba(255,255,255,0.69) 0%,rgba(255,255,255,0) 87%); /* Chrome10+,Safari5.1+ */
  background: -o-radial-gradient(center, ellipse cover,  rgba(255,255,255,0.69) 0%,rgba(255,255,255,0) 87%); /* Opera 12+ */
  background: -ms-radial-gradient(center, ellipse cover,  rgba(255,255,255,0.69) 0%,rgba(255,255,255,0) 87%); /* IE10+ */
  background: radial-gradient(ellipse at center,  rgba(255,255,255,0.69) 0%,rgba(255,255,255,0) 87%); /* W3C */
  filter: progid:DXImageTransform.Microsoft.gradient( startColorstr='#b0ffffff', endColorstr='#00ffffff',GradientType=1 ); /* IE6-9 fallback on horizontal gradient */
  z-index: 10;
}
.progress {
  animation-name: progress;
  animation-duration: 10s;
  animation-delay: 1s;
  animation-timing-function: linear;
  animation-iteration-count: infinite;
  overflow: hidden;
  position:relative;
  z-index: 1;
  height: 100%;
  width: 100%;
  border-right: 1px solid #0f9116;
  background: #caf7ce; /* Old browsers */
  background: -moz-linear-gradient(top, #caf7ce 0%, #caf7ce 18%, #3fe81e 45%, #2ab22a 96%); /* FF3.6+ */
  background: -webkit-gradient(linear, left top, left bottom, color-stop(0%,#caf7ce), color-stop(18%,#caf7ce), color-stop(45%,#3fe81e), color-stop(96%,#2ab22a)); /* Chrome,Safari4+ */
  background: -webkit-linear-gradient(top, #caf7ce 0%,#caf7ce 18%,#3fe81e 45%,#2ab22a 96%); /* Chrome10+,Safari5.1+ */
  background: -o-linear-gradient(top, #caf7ce 0%,#caf7ce 18%,#3fe81e 45%,#2ab22a 96%); /* Opera 11.10+ */
  background: -ms-linear-gradient(top, #caf7ce 0%,#caf7ce 18%,#3fe81e 45%,#2ab22a 96%); /* IE10+ */
  background: linear-gradient(to bottom, #caf7ce 0%,#caf7ce 18%,#3fe81e 45%,#2ab22a 96%); /* W3C */
filter: progid:DXImageTransform.Microsoft.gradient( startColorstr='#caf7ce', endColorstr='#2ab22a',GradientType=0 ); /* IE6-9 */
}
.progress:after {
  content: "";
  width: 100%;
  height: 29px;
  right: 0;
  bottom: 0;
  position: absolute;
  z-index: 3;
  background: -moz-linear-gradient(left, rgba(202,247,206,0) 0%, rgba(42,178,42,1) 100%); /* FF3.6+ */
  background: -webkit-gradient(linear, left top, right top, color-stop(0%,rgba(202,247,206,0)), color-stop(100%,rgba(42,178,42,1))); /* Chrome,Safari4+ */
  background: -webkit-linear-gradient(left, rgba(202,247,206,0) 0%,rgba(42,178,42,1) 100%); /* Chrome10+,Safari5.1+ */
  background: -o-linear-gradient(left, rgba(202,247,206,0) 0%,rgba(42,178,42,1) 100%); /* Opera 11.10+ */
  background: -ms-linear-gradient(left, rgba(202,247,206,0) 0%,rgba(42,178,42,1) 100%); /* IE10+ */
  background: linear-gradient(to right, rgba(202,247,206,0) 0%,rgba(42,178,42,1) 100%); /* W3C */
  filter: progid:DXImageTransform.Microsoft.gradient( startColorstr='#00caf7ce', endColorstr='#2ab22a',GradientType=1 ); /* IE6-9 */
}
.bar {
  margin-top: 30px;
  height: 40px;
  width: 600px;
  position: relative;
  border: 1px solid #777;
  border-radius: 3px;
}