Private Sector in $2b Power Deals

Private Sector in $2b  Power  DealsPrivate Sector in $2b  Power  Deals

The Energy Ministry has signed power generation contracts worth 70,000 billion rials ($2.1 billion) with the private sector, deputy energy minister, Sattar Mahmoudi, said.

“Parts of the contracts are ready for operation,” he was quoted as saying by Tasnim News Agency.

“The private sector will be attracted to the power industry, only when it finds the industry financially rewarding.”

The official called on the authorities to take into account the pattern of growing consumption rates in the coming years so as to take measures for at least the next three years.

Power consumption is projected to grow by 5-6% in the current Iranian year (started March 21). Private power plants accounted for more than 50% of production last year.

Electricity production in Iran needs an annual budget of $10 billion, half of which is spent on the electricity generation and the rest on development plans.

As outlined in Article 44 of the Iranian Constitution, a large part of executive responsibilities of the Energy Ministry must be transferred to the private sector.

According to senior energy officials, all major electricity companies and power plants have either been privatized or will be in future. Except for the government’s 20% share, the rest will be transferred to the private sector.