A consortium of Dutch and Spanish companies has won an international tender for the construction of Armenia’s first large solar power plant which is expected to cost around $50 million.
The 55-megawatt plant will be built in Mets Masrik, a village close to the eastern coast of Lake Sevan, as part of the Armenian government’s efforts to reduce the domestic energy sector’s dependence on natural gas mostly imported from Russia.
The World Bank pledged in 2015 to finance most of the landmark project in the form of a grant allocated to the government. The resulting tender attracted bids from two dozen energy companies from around the world. Ten of them were shortlisted for the final stage of the contest.
The Armenian Energy Ministry announced on Friday that the consortium consisting of the Dutch-based company Fotowatio Renewable Ventures and Spain’s FSL Solar won the bidding because of promising the lowest cost of electricity to be generated at the solar plant. It will be cheaper than power supplied by scores of small hydroelectric plants scattered around the mountainous country, the ministry said in a statement.
Work on the Mets Masrik plant may start already this year, in which case it will be completed by the end of 2020. The new facility will be far more powerful than three small solar plants that were built in Armenia late last year.
The ministry said that it has also chosen locations for five other large or medium-sized solar plants which could be constructed in the coming years. They would increase Armenia’s combined solar capacity to at least 120 megawatts. Solar energy can eventually gain a major share in Armenian electricity production, added the ministry statement.
Earlier this year, the Armenian government reaffirmed its pledges to significantly increase the share of hydropower and other renewables in domestic electricity production. Energy Minister Ashot Manukian said the government objective is to ensure that renewable sources meet at least half of Armenia’s energy needs within the next few years.
According to the National Statistical Service (NSS), hydroelectric plants accounted for about 30 percent of electricity generated in the country last year. By comparison, thermal power plants using gas had a 37 percent share in the total. Virtually all of the remaining 33.7 percent of energy was generated by the Metsamor nuclear power station, NSS data shows.
Manukian cited the upcoming construction of a 76-megawatt hydroelectric plant on the Debed river flowing through the northern Lori province. The $150 million project is led by Samvel Karapetian, a Russian-Armenian billionaire businessman.
Another Spanish company specializing in renewables, ACCIONA Energy, is currently exploring the possibility of building large wind farms in Armenia that could have a combined capacity of at least 100 megawatts. Prime Minister Karen Karapetian met with top ACCIONA executives in Davos, Switzerland in January.