In the past month more than €2.6bn in solar energy deals have been signed by Iran with companies from European Union countries. It is a sign of country that made a late entrance to the solar sector attempting to play catch-up now that punitive international economic sanctions do not bar its way.
Norway’s Saga Energy group on October 18 signed a €2.5bn deal with Iran’s Amin Energy Developers to build a solar power plant in a desert region of central Iran, according to Reuters.
Saga is the second Oslo-based firm in a matter of weeks to enter the Iranian solar energy market. Its main competitor Scatec Solar arrived first in late September.
The agreed deal with Saga, which depends on Iran completing its side of the bargain, will see the construction of a 2-gigawatt power generation plant, spokesperson Rune Haaland reportedly said.
The company is reportedly leaning on the Norwegian government’s state export guarantee fund to facilitate the project as well as private bank investment and a commitment from a pension fund.
If all goes to plan, Saga is expected to recoup its investment as part of a 25-year deal based on the sale of power generated from the site.
Solar panels for the project will be built by Saga and Lithuania’s SoliTek, while the remaining parts for the project will be produced by Taiwan-based Delta Electronics Inc.
“They will provide all the installations of electronics such as inverters, for example,” Haaland said of Delta.
As part of the deal, Iran is expected to create a solar panel plant in the next few years through a knowledge transfer deal, which would be the first such deal signed between Tehran and a foreign firm.
In response to questions about US President Donald Trump’s attitude towards the Islamic Republic and his removal of the country’s participation in the Joint Comprehensive Plan of Action (JCPOA), more commonly referred to as the “nuclear deal”, Saga’s Haaland said: “We are a little bit worried about what Trump is doing, we are very much in favour of the atomic deal, but we will, of course, continue with our plans whatever Trump does, no doubt about that, nothing can change that.”
Scatec Solar, meanwhile, is looking to build a 120-megawatt plant in the Iranian countryside initially, after which it may move on to plans to construct a 500MW plant.
“I wouldn’t like to say by when we expect a signed deal but we are actively working on it,” CEO Raymond Carlsen said at the time.
The budget for its project is expected to reach $120mn per 100MW installed according to an initial assessment, he added.
Iran currently draws roughly 53MW of power from solar generation, energy ministry data shows. It is looking to add 932MW in the next few years thanks to deals signed already.
On September 17, Austria’s Solar and Benefit Group and Shiraz-based Fars Province Investment Services Center (FPCSC) signed a memorandum to create four new smaller solar power plants in the southern region.
“The memorandum will pave the way for setting up four solar farms with a combined power generation capacity of 70 megawatts, costing $100 million,” said Babak Daei, Investment Officer for Fars Province.
The new project will create two 25-megawatt solar power facilities and two smaller 10-megawatt locations near the southern city.
Meanwhile, in another landmark deal signed in July this year, a Swiss-German consortium opened a 44-hectare and 260-watt solar farm in Kerman province, southeast Iran.
Switzerland-based Durion Energy AG, in collaboration with Germany's Adore GmbH, reportedly developed the Mokran complex over six months with an investment of $27mn.