The state-run Renewable Energy and Energy Efficiency Organization (Satba) has substantially increased the guaranteed purchase prices for hydro and biomass power generated by private companies compared to 2021.
A new directive to raise tariffs (for private sector producers) was announced by Energy Minister Ali Akbar Mehrabian on Nov. 19 to promote investment, IRNA reported.
The minister noted that the new prices for generating electricity from hydropower stations have risen by 100% per kilowatt, increasing from 2.5 cents/kWh to 5 cents/kWh.
Iran has 60 hydroelectric power plants that account for 90% of renewable energy generated across the country.
Based on Energy Ministry’s data, Iran’s renewable energy output capacity stands at 14,000 megawatts, of which 12,600 MW come from hydropower.
The rest is produced from other renewable sources, including solar panels, wind farms, waste-to-energy power plants and biomass factories.
Hydropower is a renewable energy and its production is cleaner compared to other sources like fossil fuels used in thermal power stations.
Regarding hydroelectric power capacity, Iran is ranked 19th in the world and sixth in Asia. China is first in Asia and the world with 341,000 MW.
In the coastal regions of the Persian Gulf and Sea of Oman, hydroelectric power plants have an annual energy production of over 30,000 gigawatt hours.
There are 17 hydroelectric power plants under construction. When operational, they will add 3,700 MW to the total hydropower output.
“By offering higher prices, the government intends to encourage private enterprises to invest in renewables because the firms played an important role in the development of green energy in the recent past,” the minister said.
Mehrabian said private sector investment in renewable projects now exceeds $2 billion and Satba has been tasked with devising regulations and establishing infrastructure for investors to generate and sell electricity to foreign buyers.
Waste-to-Energy Facilities
Tariffs for biomass facilities (waste-to-energy power plants) have risen threefold or 200%, and now stand at 9 cents/kWh. The prices were 3 cents/kWh last year.
A waste-to-energy plant converts solid waste into electricity and/or heat, which is an ecological, cost-effective way of energy recovery. This is being increasingly considered a potential diversification approach, as nations struggle to curb carbon emissions, climate change and their dangerous impact on health.
Incinerating a ton of waste can produce 500-600 kilowatts of electricity per hour, while preventing water and soil contamination.
“There are seven waste-to-energy power plants in Iran with a capacity of 14 megawatts, most of which are either closed or working at half capacity due to technical, economic or legal hurdles,” says Reza Samadi, the head of Economic, Social and Environmental Studies Office at Satba.
“Close to 58,000 tons of waste are produced in Iran per day, of which less than 20% are recycled and the rest is buried in landfills, causing water and soil pollution,” he said.
According to the official, private investors should get permits from the municipality to implement projects on the basis of build-operate-transfer contracts.
Samadi said Satba has guaranteed the purchase of electricity from WTE facilities for at least five years.
WTE plants will gradually lead to the closure of landfills and collection of landfill leachate — liquid contaminated with landfill pollutants — and prevent it from seeping into underground water.
The Energy Ministry also raised prices for generating electricity from small-scale solar power stations and wind farms.
New prices for generating electricity from small-scale solar power stations (with less than 20 kilowatt capacity) have risen by 20% per kilowatt, reaching 6 cents/kWh.
Tariffs for bigger photovoltaic power plants (with a capacity of 20-200 kW) have risen by 30% and now stand at 5.5 cents/kWh.
The new prices for small-scale wind farms (with less than 250 kilowatt capacity) have experienced the biggest rise (60%) and approached 5.5 cents/kWh.
According to Satba, each kilowatt of power generated in wind farms, with a capacity of between 250 kW and 1 megawatt, will be purchased at 4 cents, up 20% compared to that of 2021.
