Saturday, March 28 2015 06:22

 

The energy sector of the Armenian
SSR developed with due regard for the presence of some 1,400 industrial
enterprises in the republic, which were unique throughout the former USSR.
Today, Armenia
keeps developing its thermal and nuclear power stations
with Russian investments and neglects the
development of alternative power engineering. These processes are going on amid
the standstill of all the largest enterprises of the country and minimum export
of energy resources to the neighboring countries. Why
should Armenia keep developing its energy sector?     

 

The
main reason for this development is that the Armenian energy industry will be
facing serious problems and challenges in the coming years.  The problems are to be solved only by
developing new power capacities. The problem is that the main power capacities
- Metsamor NPP and Hrazdan TPP are rather old. These capacities will sooner or
later (probably, sooner than later) break down. That is why Armenia needs new
sources of energy production. Armenia prefers thermal power to alternative
energy resources due to the gas cheapness. The price will not increase in the
coming years. The raw materials for alternative energy resources are to be
expensive so that the alternative energy production can give the TPP a run for
its production. Armenia will not be facing that threat in the near future.

 

Moscow and Yerevan have signed an
agreement for a $300 million loan for extension of the Armenian NPP's service
life for another 15 years. Does it mean that Armenia has finally given up the
idea of construction of a new power unit?   
 

 

Although
there is no official refusal from construction of a new nuclear power unit in
Armenia, the chances for construction are miserable. The reasons are financial:
there is neither investor nor sales market. The new power unit will have a 2.5-
fold higher capacity than the operating one. What to do with the surplus and
expensive electric power that will be generated? Nothing. Georgia does not need
it. Iran will not pay 15 cents for 1kWh of electric power.  The border with Turkey is closed. Even it if
opens, I see no reasons for Turkey to invest dozens of millions to create in
its territory a 'power island' that will depend on the electric power generated
by the Armenian NPP. Armenia can consume the electric power to be generated by
the new NPP for domestic purposes, but then what to do with the electric power
generated by the operating thermal and hydro power plants. I think the new
plant, if built, must have a capacity of some 600-650MW, but such reactors are
not produced in Russia. Russia, as the only country that may have some
political interest in construction of a new power plant in Armenia will hardly
fund construction of a French reactor.

 

According
to ArmInfo's information, the Iranian side has already transferred 85 million
USD to one of the Armenian commercial banks under the agreements on
construction of the third Iran-Armenia power transmission line. Though Iran has
fulfilled part of its obligations, the project is still far from being
implemented. Why?

 

I
do not doubt the implementation of that project. Despite some technical
problems related to the power capacities through which the energy is to be
exported to Iran, I believe the project will be implemented for it has certain
economic feasibility.

 

The project of the Iran-Armenia railway construction is still on the
agenda of the Armenian-Iranian relations. In the meantime, the issue of linkage
of the Iran-Azerbaijan railway systems through construction of the Qazvin-Rasht-Astara branch line has
already been included in the Tehran-Baku agenda. Why do you think Tehran is
playing such a game and what prospects do the two projects have, given the lack
of the Armenian-Iranian project among Iran’s railway projects?  

 

The project is delayed for a range of
problems.  The major reason is lack of
investors, while the project is estimated at $4- $6 billion. The second reason
is that the railway is not necessary. If it is part of the North-South
transport corridor, it duplicates the Qazvin-Rasht-Astara railway through which
cargoes from the Persian Gulf will be transported to the Black Sea via the
territory of Azerbaijan and Georgia and to Russia and North Europe via
Azerbaijan and through the Russian ports in the Baltic Sea. If they are
building one railway, there is no sense in building a similar one. The point is
that construction of the Qazvin-Rasht-Astara railway was to be completed yet in
2010. It is not clear either if the Abkhazian section of the Russian-Georgian
railway will be reactivated. If no, so why do they build the railway from Iran
to Armenia? If they do it to link the Persian Gulf with the Black Sea, it does
not cost $6 billion. Furthermore, the plans to expand Tabriz-Erzrum road and
develop railway communication in Turkey are enough to settle those tasks. It is
unreasonable to focus on the given project. Armenia just should properly
complete the construction of the North-South transport corridor which will
settle a range of strategic tasks.

 

Washington’s rather serious
concessions in the US-Iran talks on the nuclear problem demonstrate the
enhancement of Iran’s geopolitical capacities. Iranian experts speak of
Tehran’s striving to extend its presence in the South Caucasus geopolitics. Do
you expect any impulses here?    

 

Tehran’s policy in the South Caucasus
has been focused on Azerbaijan over the past two years. This is proved by
Aliyev's visit to Tehran and Hassan Rouhani's visit to Baku, by a number of
important documents signed in the course of those visits, and unfortunately by
a declaration pointing out that there is no alternative to the Karabakh problem
settlement through observing the territorial integrity of Azerbaijan. 

 

Rouhani
seeks to minimize the discrepancies with the neighbors while Tehran is holding
active negotiations with Washington. So, today Iran is playing a "big game"
and does not want to abstract from it. Given that Iran had serious
discrepancies with Baku, the Azeri agenda of Iran is quite active today. It
should be noted that Tehran has taken advantage of the crisis in the
Baku-Washington relations and started feeling comfortable with respect to Baku
and this has been reflected on the interstate relations. One should not neglect
the ISIS factor either. The fears that this factor may emerge in Azerbaijan
will focus Tehran's attention on Baku, because the emergence of the ISIS in the
South Caucasus is a direct threat to Iran's security.