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EBRD, IFC and EU partner with Fotowatio Renewable Ventures to support first solar plant in Armenia

Power News - Published on Tue, 21 Jul 2020

Image Source: Fotowatio Renewable Solar Power
The European Bank for Reconstruction and Development, World Bank Group’s IFC and the European Union have agreed to support the development of the first utility-scale solar power plant in Armenia, which is also the first for the Caucasus. The 55 megawatt power plant facility, located in Mets Masrik municipality in Gegharkunik Province, will boost Armenia’s supply of renewable energy and will help the country reduce its reliance on imported fuels. The plant is being developed by Fotowatio Renewable Ventures, part of Abdul Latif Jameel Energy, a global leader in utility-scale renewable energy projects. The company will receive a USD 35.4 million debt financing package consisting of two USD 17.7 million long-term loans, one each from IFC and the EBRD. The project will also receive a EUR 3 million investment grant from the European Union, mobilised by the EBRD. The IFC financing package includes a USD 8.9 million loan from IFC’s own account and a USD 8.9 million loan from the Finland-IFC Blended Finance for Climate Program.

The Masrik solar plant is expected to generate more than 128 gigawatt-hours of electricity annually at a competitive tariff of 4.19 cents per kilowatt-hour. The electricity will be sold under a power purchase agreement to Electricity Networks of Armenia, a utility responsible for distribution of electricity. The project will displace the release of 40,000 tonnes of carbon emissions annually. Right now, nearly 70 per cent of Armenia’s electricity generation depends on imported fossil fuels. As the country’s demand for electricity grows, renewables are expected to provide a sustainable and low-cost alternative source of energy and the Masrik plant is designed to set an example for the rest of the Caucasus.

The project, which includes the development, construction and operation of a 55 MW power plant and a 9 kilometre transmission line, is the first competitively tendered solar-photovoltaic project in Armenia. The World Bank helped the government prepare the project and provided transaction advisory support. The bidding process, backstopped by the Scaling up Renewable Energy Program and the World Bank, was highly competitive.

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Posted By : Yogender Pancholi on Tue, 21 Jul 2020
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