Armenian energy minister says renewables, nuclear power to replace Russian gas

Armenian energy minister says renewables, nuclear power to replace Russian gas
The Guyumush hydroelectric power plant is part of the Sevan–Hrazdan Cascade, a complex of hydroelectric power plants on Armenia's Hrazdan River and its tributaries between Lake Sevan and Yerevan.
By bne IntelliNews February 1, 2018

The Armenian government will continue with its efforts to reduce the share of Russian gas in the country's electricity mix, Energy Minister Ashot Maukyan said on January 31, according to the local edition of Radio Free Europe/Radio Liberty (RFE/RL).

Russia is Armenia's main purveyor of gas - it sends some 2bn cubic metres (cm) per year - as well as Yerevan's main diplomatic, commercial and security partner in the region. Furthermore, Russian companies own electricity distribution and transmission companies in Armenia. In 2015, Armenians protested for weeks against a proposed tax hike for electricity, accusing Inter Rao, the Russian owner of the country's sole electricity distribution company, of mismanagement and corruption. State-owned Inter Rao sold the power distribution company to another, private Russian company, Tashir Group.

In recent years, Armenia has been seeking to expand its gas trade with Iran under a barter agreement: Iran exchanges gas for electricity, which Armenia exports through two transmission lines that connect the two countries. Several more transmission lines are currently under construction.

Manukyan, however, did not speak about Iranian gas, but about renewable and clean energy in his discourse on January 31, saying that Yerevan was looking to derive half of the power demand in the country from these sources. Hydropower accounted for 30% of the power generated in Armenia in 2017, according to the national statistics agency, gas for 37% and nuclear power from a Soviet-era plant for 33.7%.

The share of hydropower in the total power mix has increased over the past decade thanks to favourable legislation that Yerevan passed to encourage the construction of micro and small-scale installations. However, the legislation has not been without its controversies, as it was later revealed that the relatives of government ministers benefited from the scheme and built hydroelectric power stations, sometimes without environmental due diligence.

Armenia has also secured funding from the European Bank for Reconstruction and Development (EBRD) for the construction of a 55 megawatt (MW) solar array and is planning to build other, smaller arrays.

According to Manukyan, the expansion of the country's sole nuclear power plant at Metsamor will also help replace gas as a source of power. The power plant is currently being expanded and refurbished thanks to $300mn in loans and grants from Russia. However, environmentalists have complained that the plant poses a threat because of its age - it was first commissioned in the 1980s - and should be shut down. 

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