The Energy Ministry and the British Photovoltaic Association (BPVA) signed a memorandum of understanding on the construction of a 1000-megawatt solar power plant in Iran.
The agreement was concluded on Thursday in London in the presence of Energy Minister Hamid Chitchian, Reza Sheybani, chairman of the BPVA, Gregory Leonard George, a former UK secretary of state for energy and climate change, Mohammad Hassan Habibollahzadeh, Iran's charge d'affaires to Britain along with some business leaders, IRNA reported.
BPVA, a political and commercial organization, has made a significant contribution to developing the UK solar industry in recent years and is now one of the largest solar markets in the world by installed capacity.
According to Sheybani, the agreement seeks not only to build a cutting-edge solar power plant at an estimated cost of $1.6 billion but also to establish a solar panel factory as well as transferring the much-needed technology to Iran.
Asked about the funding for the mega project, he noted, "Plans have been made to attract international financing to make the initiative operational as soon as possible."
Sheybani stressed that the plant will be a joint venture, worth $28 million, with a capacity to produce panels capable of producing 500 MW of electricity per year. Negotiations are also underway with Germany, Switzerland and the Netherlands on transferring their solar panel technology to Iran.
Profitable Venture
Sheybani said such ventures create jobs and generate considerable profit.
"The British government earns more than $10 million per annum just through issuing required licenses to install solar panels on rooftops. Furthermore, the projects have created jobs for more than 35,000 people since 2010."
"Iran's energy sector is one of the world's biggest for investment, as the country aims to rebuild its infrastructure," Habibollahzadeh said, adding that at the Paris Climate Conference in November 2015 Iran said it will produce up to 7,500 MW from renewable sources, which requires at least $12 billion in investment.
He added that with more than 300 sunny days throughout the year that is much over and above the weather in Britain with 150 days of sunlight per year on average and with far less intensity in radiation, Iran has huge potential to expand solar energy infrastructure.
Experts, however, say investment in fossil power plants that costs the country billions of dollars every year has visibly constrained the development of renewables. Analysts say Iran is relying too much on non-renewable energy sources because of its relatively easy access to enormous oil and gas reserves.
Development of renewables is fast gaining traction across continents. According to the International Energy Agency, renewables will represent the largest single source of electricity growth over the next five years by rising over 26% by 2020 from 22% in 2013, a remarkable shift in a very limited period of time.
