Energy efficiency and renewable energy policies can substantially reduce the demand for and supply of energy generated from fossil fuels namely natural gas, oil and coal-fired power plants.
Meysam Latifi, assistant to the Iranian president and head of the Organization for Public Administration and Employment Affairs, made the statement on Thursday to break ground on a major 600-megawatt photovoltaic (PV) power project in Kouhpayeh County in Isfahan Province, IRNA reported.
“Projected to cost $500 million, the project will be financed by Mobarakeh Steel Company, the largest steel company in Iran and the wider Middle East and North Africa region.”
Kouhpayeh PV power station will be the largest of its kind in Iran and is expected to be fully operational in three years, he noted.
According to the official, the first phase of the plan will add close to 100-MW to the national power grid by July.
“The solar farm will be built on a 1,200-hectare piece of land and is expected to help reduce natural gas consumption by about 350 million cubic meters per year.”
Iran's installed solar power generating capacity is about 450-MW and this initiative alone will add 600 megawatts to the output.
The central Isfahan Province has five solar power stations.
Iran has a diverse climate with vast windy lands and more than 300 sunny days a year, renewable power production is 980 MW -- a meager share compared to the total 90,000 MW.
With the ongoing projects renewable output is expected to reach 1,100 MW by 2023.
Emphasizing the need for a bigger role for private companies in developing the key power industry, the official said: "Currently, more than 60% of the electricity is produced by the private sector."
Due to government funding constraints and economic pressures, over the years private firms have taken the mantle to help develop renewable energy.
Private companies have invested $1 billion in the gradually expanding renewable sector, mainly solar and wind.
--- Energy Efficiency
“Renewable energy and energy efficiency work in synergy. When pursued together, they can bring faster reduction in energy intensity and lower energy costs.”
Real environmental and social benefits can be gained by enhancing the synergy between renewables and energy efficiency.
Power generation from many types of renewables are 100% efficient in international energy statistics, while fossil power plants achieve only 25–85% efficiency.
Though the cost-competitiveness of technologies varies by country, the combined deployment of renewable energy and energy efficiency technologies always results in overall savings.
“We have found that renewables and energy efficiency can work together to provide over 90% of the mitigation needed in the energy system by 2050.”
Energy efficiency and renewable energy investments can produce significant benefits, including lower fuel and electricity costs, increased grid reliability, better air quality and public health, and more job opportunities.
Renewable energy deployment was found to be fastest and least expensive in the scenario with energy efficiency.
When paired together, energy efficiency and renewable energy can support broader transitions in the global energy system.
Energy efficiency reduces the amount of energy needed to provide the same or improved level of service to the consumer in an economically efficient way.
Common policies include resource and technology standards, codes, and incentives that can advance the deployment of energy efficient technologies, and practices across all sectors of the economy.
Energy efficiency and renewable energy initiatives affect the economy both directly and indirectly, by affecting individuals, businesses, or institutions directly involved in the investment as well as by having an effect on others who are less directly involved.
Private Sector Investment
According to Energy Minister Ali Akbar Mehrabian, the Renewable Energy and Energy Efficiency Organization (Satba) is obliged to prepare the ground for private sector investment in and the export of renewables.
“The Energy Ministry is preparing a plan of action based on which solar and wind power generated by private companies can be sold without state interference,” he added.
According to the minister, the production and export of green energy should be as competitive as possible, such that private investors are able to handle all operations without government intervention.
“Providing thermal power stations with subsidized natural gas as feedstock is the main obstacle to the green sector expansion,” he said.
Simply put, as long as gas-powered units run on cheap fuel, private firms will not be able to compete with them.
As per law, the government buys electricity from large solar plants and small photovoltaic stations.
However, “with the new action plan whose details will be announced soon, private companies can directly use the electricity they produce, sell it to others, or export it,” he added.
One of the reasons behind the plan is the government’s limited financial resources to continue payment of electricity subsidy and the other is the oft-mentioned government decision to downsize and privatize.
In the past 10 years, the number of private companies active in the renewable sector – wind and solar – has shot up from three to over 500.
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.
The Energy Ministry will play a facilitative role and not intervene in the process of attracting buyers and determining charges, he added.
