Tehran, Yerevan Finalize $342m Electricity Deal

Tehran, Yerevan Finalize $342m Electricity Deal Tehran, Yerevan Finalize $342m Electricity Deal

Iran and Armenia have finalized electricity contracts for establishing a double circuit transmission line and for setting up a 400-kilovolt substation in Norvan in Armenia both valued at $342 million (€307 million).

"The delay in the project (signed in 2006 for the transmission line) had nothing to do with Iran sanctions, but was due to domestic challenges and problems between one of Armenia's banks and Export Development Bank of Iran," Aram Ananyan, managing director of Armenia High-Voltage Electric Networks Company, was quoted as saying by Fars News Agency.

The new transmission contract, valued at $119 million, was concluded between HVEN and Iran Power & Water Equipment and Services Export Company—aka SUNIR—on Wednesday.

According to Armenian daily Massispost, EDBI will provide 77% of the total sum of the transmission line and the rest will be supplied by SUNIR, which will also implement the project.

"With completion of the project, electricity exchange between Iran and Armenia will increase from 300 megawatts to 1,000 MW," Bahman Salehi, managing director of SUNIR, said, adding that Iran's electricity grid will be connected to Georgia, Russia and Turkey's national grid.

In addition, the line enables Iran and Armenia to exchange electricity not only during the day but also at night.

The double circuit transmission line, which is about 275 km, is projected to go on stream in 24 months.

Iran’s electricity industry ranks 14th in the world and first in the Middle East in terms of power generation with an installed power generation capacity of 72,000 MW.