Renewable Energy in Armenia

• TAMARA BABAYAN

• Director of R2E2 Fund

Hydro Resources

250-300MW

Feasible Potential of Renewable Resources in Armenia

Wind resources

300-500MW

• TAMARA BABAYAN• Director of R2E2 Fund

Solar resource>1000MW

• Geothermal resources

• 25-50 MW

Technical Potential of Selected Renewable Energy Technologies

2010 2015 2020

Small Hydro Power Projects

Generation capacity in place [MW] 102,5 179 216,5

Investment cost installed [USD/kW] 500-700 1200 1500

Production costs [USD Cent/kWh] 3,3-4,9 6 7.4

Wind Power

Generation capacity in place [MW] 2.6 102.4 302.4

Investment cost installed [USD/kW] 2100 2040 2000

Production costs [USD Cent/kWh] 10.3 10.8 11.8

Photovoltaics

Generation capacity in place [MW] 0.1 0.3 1

Investment cost installed [USD/kW] 6000 5000 2700

Production costs [USD Cent/kWh] 47 38 24

Geothermal

Generation capacity in place [MW] 0 0 25

Investment cost installed [USD/kW] 0 0 3000

Production costs [USD Cent/kWh] 0 0 6.75

Technical Potential for Selected RETes

Base Growth Case for the Development of RETs in Armenia

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Current Situation

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Generating units Number of plants Capacity, MW Annual Production, GWh

SHPP 111 149 482

Wind 1 2,64 5,0

Biomass 1 0,835 5,9

Solar PV 1 0,01 0,015

Total 114 152,49 492,92

SHPP in construction

80 154 578

Wind PP in construction

2 19,05 30,1

ALL 116 325,54 1101,02

Policy Incentives

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• Guaranteed purchase of produced electricity within 15 years after commissioning /production license/

• Fixed tariff– SHPP /natural flow/ -19.551 AMD/kWh - $0.052– SHPP /irrigation/ - 13.033 AMD/kWh -$0.035– SHPP /drinking water/ - 8.69 /kWh -$0.023– Wind – 35.339 AMD/kWh – $0.093– Biomass – 37.446 AMD/kWh -$0.1

• End user tariff /population/- 30 AMD/kWh (day)-$0.08; 20AMD/kWh night - $0.054

Barrier Removal and Facilitation

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Barrier FacilitationINFORMATIONAL

Identification of Barriers R2E2 has identified and submitted to Government special Task Force

Information on potential sites R2E2 has updated SHPP scheme of Armenia

Information on technologies and market TA programs financed by IFIs

TECHNOLOGICAL

Lack of water merits points SHPP scheme

Capacity of engineering design TA of IFIs, local bank experts

Lack of equipment in local market Local production facilities including GRP pypes

FINANCING

Exaggerated risk of investment IFIs involvement

Collateral Installed equipment serve as collateral

Lack of long-term loans IFIs support

High interest rate IFIs support

Financing Opportunities

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• R2E2 Fund – WB $5mln., EBRD $7mln., Local Bank

$3mln., co-financing >30%, actual $28 mln. -26

SHPP

• R2E2 Revolving – $9.2 mln.

• IFC/FMO – 15 SHPPs (about 22 mln. USD)• KFW – 1st tranche – 14 SHPPs – 6 mln. Euro• KFW – 2nd tranche 11 mln. Euro AA SHPPs

Forests-10%

Gas-0%Oil-0%Coal-0%

• Renewable is not only energy security but

also National security for my country

Energy Efficiency

• Enhance energy security – ~97% of primary energy sources are imported

• Ease budget constraints – energy costs are generally highest cost

• Improve comfort levels – survey results show average comfort levels in social buildings ~40%

• Mitigate impacts of ongoing pricing reforms – gas prices increased ~58% from 2008 to 2010; electricity also increased 20% (daytime), 33% (nighttime)

• IFI lending opportunities for industrial energy efficiency

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OPPORTUNITIES – Energy Efficiency

• Enhance energy security – ~97% of primary energy sources are imported

• Ease budget constraints – energy costs are generally highest cost

• Improve comfort levels – survey results show average comfort levels in social buildings ~40%

• Mitigate impacts of ongoing pricing reforms – gas prices increased ~58% from 2008 to 2010; electricity also increased 20% (daytime), 33% (nighttime)

• IFI lending opportunities for industrial energy efficiency

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R2E2 Fund - OUR CURRENT AND NEW ACTIVITIES

• On-going activities • Biomass investment plan preparation• Geothermal surveys in potential sites• Innovative financing of energy efficiency• Procurement mechanism for public building EE• Energy balance of Armenia• New activities• Run the SuperESCO mechanism• EE services to demonstrate benefits and reduce risk for

private sector (Energy audit, EPC, Monitoring, Trainings Risk Management)

• Climate Investment Fund SREP preparation

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Tamara BabayanDirector

Renewable Resources and Energy Efficiency Funddirector@r2e2.am

www.r2e2.am; www.reweek.am

•THANK YOU

RENEWABLE RESOURCES AND ENERGY EFFICIENCY FUND