Renewable Energy in Armenia: Recourses and Implementation Yerevan, Armenia. October, Dr. Ara H. Marjanyan GEF/WB Renewable Energy Project Coordinator. Armenian Renewal Resource and Energy Efficiency Fund Renewable Energy Week in Armenia 2010

A. H. Marjanyan 2 WB/R2E2 Fund Renewable Energy Project Up to August 2010, about $3 mln. WB credit money was provided for about 28 SHPP projects with total installed capacity of about 40 MW; 15 special projects was carried out with total contract amount of $1.3 mln grant money; 110 leading experts from different areas of renewable energy: 93 from Armenia and 17 from abroad (USA, RF, Denmark, Sweden, Switzerland); Three more international projects are in starting phase: 1) Preparation of the Renewable Energy Development Road Map for Armenia; 2) Update of Loriberd HPP bankable feasibility study; 3) development of innovative mechanism for renewable energy project implementation in Armenia:

A. H. Marjanyan 3 Medium and Large HPPs Currently not utilised hydro potential: Substantial but limited MW in total with bln. kWh/year. Investment opportunities: Realistic. Armenian-Iran collaboration (Megri HPP), possible intervention of respectable IFIs (WB, IFC etc.), measurable interest from private investors. Project implementation: Active. Utilisation of this total potential is foreseen by GoA Action plan till Projects: 140 MW Meghri HPP (800 mln kWh); 60 MW Loriberd HPP (200 mln kWh) and MW Shnogh HPP (200 mln kWh). Barriers: Some difficulties on land ownership issues.

A. H. Marjanyan 4 Pumped storage HPP Project implementation: Special investigation was carried out under WB/GEF REP. Main parameters: 3 perspective sites selected from 11, Installed capacity in Generation mode 150 MW, 440 mln. kWh/year; Storage mode 200 MW, 580 mln. kWh/year Barriers: 1) Limited local experience in design of modern PSHP with reversive units. 2) Not clear approach for PSHP tariff setting. All these barriers can be overcome under current conditions.

A. H. Marjanyan 5 Pumped storage HPP (cont.) ГАЭС мощностью 150/200 MW позволит: расширить технический диапазон регулирования мощности на 350 MW, увеличить средневзвешенную годовую загрузку АЭС на 100 MW, а ее годовое производство электроэнергии на 700 млн.кВтч, сократить экономические потери от ночных разгрузок ТЭС, обеспечить необходимый диапазон автоматического вторичного регулирования мощности перетока в Иран, повысить эффективность противоаварийного управления энергосистемой. Доход ГАЭС, получаемый от оказания системной услуги по регулированию мощности, эквивалентен млн.кВтч/год, несмотря на то, что физическое годовое потребление превышает генерацию на 146 млн кВтч при преднамеренно принятом низком КПД=75% (КПД современных ГАЭС превышает 80%).

A. H. Marjanyan 6 Small Hydro Power Plants Currently not utilised hydro potential: Substantial but limited. About mln. kWh/year mln. Currently about mln. kWh/year from existed SHPPs. Results of SHPPs Scheme Update are presented. Investment opportunities: Realistic but the pace of implementation is slow-down. WB IFC, EBRD, KfW and private Armenian Banks. Barriers: 1) Primarily administrative related with Land Ownership issues, bankable feasibility studies; 2) Measurable increase (75-100%) of prices for main hydropower equipment and pipes during last years. 3) Some of this barriers could be overcome by implementing of some tariff adjustment. Unfortunately, this year such attempt was halted by PSRC.

A. H. Marjanyan 7 Wind power Potential: Substantial but limited. Confirmed by monitoring: in total about 195 MW with 490 mln. kWh/year; Not yet confirmed: in total about 300 MW with 765 mln. kWh/year average. Project implementation: Slow. Wind Power Atlas available since 1989, wind electricity tariff since 2002, but no commercial installations up to now. Current investment opportunities: Questionable. Barriers: Measurable. 1) High upfront costs, 2) difficult importing routs of heavy (main drive) and large (blades) equipment; 3) Not attractive wind power tariff, not user friendly tariff formula and mechanism.

A. H. Marjanyan 8 Geothermal (high potential) Not utilised potential: Quantity not known. Some meaningful assessments could be done after implementation of the special study funded by WB/GeoFund and planned for Current investment opportunities. Questionable: Private Armenian investor from Diaspora express its interest to exploit the Jermaghbyur high potential geothermal site (Syunik). No activities up to now. Project implementation. Slow, becoming moderate. Implementation of the 25 MW Jermaghbyur Geothermal Project Feasibility Study under TF WB/GEF Project and Identification of Prospective High Geothermal Capacity Sites in the Republic of Armenia carried out under WB/GEF REP helped to facilitate works in this direction. WB/GeoFund spunsored geothermal project started in Two perspective sites in Gegharkunik and Syunik are under investigations (GEORISK Scientific Research CJS, RA; South Florida University, USA, Western Geco Electromagnetics Ltd., USA and University of Leeds, UK).

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10 Solar PV Not utilised potential: Huge. Limited only by economical constrains. Technical solar PV potential in Armenia can be assessed as 170 kWh/m 2 /year (the average in Europe is about 100 kWh/m 2 ) with turn- key cost of per kW peak. Project implementation: Moderate. Implementation of the WB/GEF REP Assistance to the Modern Solar PV development in Armenia helped to assess modern PV production potential (cells, elements, components, units) in Armenia, select perspective technology and assess the raw material deposits for the all value chain of modern PV (from mines to market). Results are presented to your attention in separate flayers. Current investment opportunities: Questionable. Participations of International IFIs is possible but not guaranteed. Barriers: Measurable. 1) Absence of comprehensive development strategy; 2) Absence of solar PV electricity tariff (current net-metering concept is not enough); 3) Mental inertia.

A. H. Marjanyan 11 Bioethanol Project implementation. Active. Implementation of theAssistance to the bioethanol production development in Armenia under WB/GEF REP helped to outline the potential for first generation technology based bioethanol production: 14 thous. t. bioethanol per year and up 5% blending at 5-th year (details are presented in materials of the conference). Additional investigations (MoE, R2E2 fund) indicated much higher potential for 2-nd generation technology based bioethanol production in Armenia. Current investment opportunities: Not clear. Some interest from private investors, but causes approach from IFIs. Barriers: Measurable. 1) Questionable quality control and not transparent situation with benzin blending; 2) Absence of E85 or E90 analogue standards in Armenia, 3) Taxation on spirit products (bioethanol).

A. H. Marjanyan 12 Other Perspective RE Solar heaters, hot water preparation, Solar non-PV Electricity (Central receiver, parabola-cylindrical troughs, Stirling engines) Heat pumps, Biomass (municipal solid waste; methane capturing etc.) Hydrogen Economy, Hydrogen cars, Hybrid cars, Electromobiles Solar passive architecture Zero emission cottages Green housing Green cities No real progress

A. H. Marjanyan 13 Conclusions RE area is much broader and complex than it is traditionally perceived in Armenia - both on decision making level and among specialists. Development of RE in Armenia is very non- homogeneous. There are some success stories (small hydro), but also vary slow progress (wind, biomass) and painful draw-backs (solar PV). Negative impact of global financial crisis. Introduction of effective and sustainable Piloting mechanism (solar PV and Thermal, heat-pumps, Solar passive architecture and green housing) is critical for Other RE development.

A. H. Marjanyan 14 THANK YOU