Iran Pushes for 5 Gigawatts of Renewable Energy by 2018

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Written by Richard Finlayson, Senior International Editor for Industrial Info Resources (Sugar Land, Texas)--With 70 gigawatts (GW) on its grid and demand growing at 5,000 megawatts (MW) annually, Iran is now pushing to add 5,000 MW of wind and solar power by 2018.

Since the drive for renewables began in January this year, 400 MW of projects have begun construction and 900 MW of renewable energy contracts have been signed. Wind power projects will take the largest share of the 5,000-MW total, but 500 MW already has been earmarked for solar photovoltaic (PV) power; some projects already have been given license to commence construction or enter into power purchase agreements (PPAs).

At a renewable energy-themed meeting at the Iranian embassy in Berlin, Germany, the delegation from Iran emphasized the importance of pursuing a renewable energy route. The delegation said that environmental concerns were just as high on its agenda as economic concerns. Iran's Energy Ministry is keen to open dialogue with Western investors in an effort to meet the country's expanding electricity demand. This demand is also spurred by the highly subsidized tariff of U.S. 0.02 cents per kW for consumers.

To support the renewable energy drive, the ministry introduced a five-year feed-in-tariff (FiT) of U.S. 0.15 cents per kilowatt-hour (kWh) for renewable from the beginning of this year. Some in the audience at the Berlin meeting felt that the FiT period was not long enough, but a solar equipment supplier was reported as saying that the, high levels of solar radiation in Iran, coupled with the relatively low production costs of solar power, made the FiT an attractive proposition to both consumers and the government. The government also provides grants of up to 50% of the installation costs for residential PV arrays.

Currently, hydropower accounts for 11 GW of the country's power generation, but demand for solar PV is increasingly driven by a domestic desire to transition to a more sustainable and environmentally friendly energy source.

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