Private equity fund Amber Capital Armenia, supported by the European Bank for Reconstruction and Development (EBRD) and the European Union (EU), has acquired Solis, an Armenian solar plant operator, to build and operate a 4 MW photovoltaic (PV) solar power plant in Aragatsotn, western Armenia.
The facility is expected to be operational by the end of 2021 and generate 7.5 GWH of clean energy per year, resulting in 3,200 tonnes of avoided CO2 emissions annually. The power plant will contribute to Armenia’s green recovery and create around 50 jobs in construction and plant operations.
Ecoville LLC, a leader in the development and construction of commercial ground-mounted solar power plants and rooftop PV systems in Armenia, has been awarded the engineering and construction contract for the project in a competitive tender process.
This is the first project financed by EU-Armenia SME Fund, managed by Amber Capital; the private equity fund seeks to invest in viable small and medium-sized enterprises (SMEs) in Armenia. Ameriabank provided financing towards this first project.
Anushavan Simonyan, CEO of Amber Capital Armenia, highlighted the importance of the project for both the country and the fund, emphasising that renewable energy is one of the fund’s priorities. “The investment in this solar project is the first step in our strategy to develop a market-leading renewable-energy assets portfolio, adhering to the highest environmental, social and governance standards,” he said. “We see a great potential and continue to seek investment opportunities in the renewables space, with the goal of contributing to Armenia’s green energy potential, environmental improvement and job creation. We are very pleased to partner with Ameriabank and Ecoville to make this important project happen.”
Artak Hanesyan, Ameriabank CEO, underscored the potential of Armenia’s renewable energy sector and noted that Ameriabank has been supporting a series of projects in the renewable energy sector. “We are delighted to be part of key investment projects in Armenia that contribute to the development of the country’s strategically important economic sectors,” he said. “We are committed to the delivery of our green policies, and the partnership with Amber Capital is yet another important contribution to a more efficient and environmentally friendly energy system in Armenia.”
“Increasing the production of clean energy is an important step in reducing carbon emissions in Armenia and addressing climate change. This is yet another step in boosting the solar capacity of the country. One of the core objectives of the EBRD is the transition towards a low-carbon economy,” Dimitri Gvindadze, EBRD Head of Armenia, said.
“The EU Armenia SME Fund is key for the country’s business environment and investment climate, in line with Comprehensive and Enhanced Partnership Agreement standards. We are glad and proud that the Fund’s first investment is in the renewables sector, which signifies the potential for sustainable finance and investments in Armenia. The EU is committed to supporting the country and its private sector on the path to green recovery, economic growth, and job creation. The green transition is on its way and unstoppable,” Andrea Wiktorin, Ambassador of the European Union to the Republic of Armenia, mentioned.
Renewables in Armenia
Armenia has limited energy resources and can meet only a fraction of the total demand for energy from domestic resources. Armenia has no confirmed oil or natural gas reserves and is thus highly dependent on imported energy resources.
The government has adopted several laws focused on developing domestic, especially renewable, energy resources and implementing energy efficiency measures.
The Law on Energy regulates relations between legal entities involved in the energy sector and provides the legal basis for producing and delivering electricity, heating, and natural gas to consumers. The Law on Energy Efficiency and Renewable Energy seeks to identify mechanisms to improve energy efficiency and develop additional sources of renewable energy. The law facilitates the development of renewable energy resources and specifies that all renewable energy produced is to be purchased by the electricity distribution company.
Armenia has sufficient electricity-generating capacity to meet current domestic needs, but electricity demand is projected to grow by two to three percent annually. Electricity in Armenia is generated primarily by the Armenian Nuclear Power Plant, hydroelectric plants, and thermal plants. Solar provides only a fractional amount of generation at present.
The Fund for Renewable Energy and Energy Efficiency of Armenia (R2E2) is a state entity that is responsible for creating a favourable environment for the development of renewable energy and energy efficiency projects. The organization examines potential opportunities for solar, wind, and geothermal energy development in Armenia.