Infrastructure Sector News of Armenia

July 25, 2024 Armenia`s cabinet approves $200mln loan for Kajaran tunnel construction

The Republic of Armenia  and the Eurasian Development Bank (EDB) will sign a loan agreement  for the provision of an investment loan in the amount of $200 million  from the Eurasian Fund for Stabilization and Development (EFSD) to  finance the <Construction of the Kajaran Tunnel> project within the  framework of the <North-South> road corridor investment program.  The  proposal to sign the document was approved by the Cabinet of  Ministers on July 25. 

As stated in the explanatory note to the document, the project plans  to build the Kajaran tunnel (length about 7 km) and reconstruct the  existing section of the M2 Yerevan-Yeraskh-Goris-Meghri-Iranian  border road with a length of about 4 km (entrance to the Kajaran  tunnel - intersection of the planned new section of the  Sisian-Kajaran road).

It is planned to alienate about 160 land plots for the needs of the  project. The estimated period for the implementation of the planned  construction works will be about 6 years. The estimated cost of the  planned construction works (including VAT) is 144.6 billion drams (or  about 369 million US dollars).

Earlier, ArmInfo, citing MTUI, reported that work on the construction  of a tunnel (about 7 km long) and the reconstruction of a 4-kilometer  section of the existing M-2 road Yerevan-Yeraskh-Goris-Meghri-  Iranian border is planned to begin only in 2025. In general, the  investment program of the North-South road corridor, which was  planned to be completed within 4-5 years (the start was given on  September 13, 2012), spending less than $ 1 billion, has been  implemented by 10% to date, and the amount of attracted loans as of  the end of May 2024 amounted to $ 800.7 million. Within the framework  of the project, borrowed funds from the EDB (EFSD), according to the  Ministry of Finance of the Republic of Armenia, amounted to $ 150  million. (Tranche 4, Artashat-Agarak road section).

<North-South> is one of the largest projects in the history of  independent Armenia. This road will reduce the distance from the  Iranian border to the Georgian border from 556 to 490 kilometers. The  road will significantly facilitate access to the Black Sea not only  for Armenia, but also for Iran.

Source:finport.am

July 23, 2024 Armenia`s minister of territorial administration visits Masrik-1 solar station

Minister of Territorial Administration and Infrastructures of Armenia Gnel  Sanosyan visited the Masrik-1 solar station.

According to the department's press service, the minister got  acquainted with the progress of construction work and talked with  engineers and builders. The project involves the construction of a 55 MW station, which will  significantly increase the volume of renewable energy production.

The Masrik-1 station is privately owned and owned by the Spanish  company FRV, the local contractor is the Stiegen company.

On July 19 last year, PSRC issued a license for the production of  electricity from Mets Masrik. Fotowatio Renewable Ventures (FRV), a  member of Abdul Latif Jameel and a leading global developer of  renewable energy projects, together with IFC, EBRD and Ameribank,  successfully completed a deal to finance the construction of the  largest solar power plant, Masrik-1, with a capacity of 55 MW , which  will generate more than 128 gigawatt-hours of electricity per year at  a competitive rate of $41.9 per MWh to power more than 20,000 homes  and avoid the emission of more than 40,000 tons of carbon per year.  As part of the project, an electricity purchase agreement was signed  with the Electric Networks of Armenia company, which will distribute  the electricity produced. The International Finance Corporation (IFC)  and the European Bank for Reconstruction and Development (EBRD)  supported the project by providing priority loans and an investment  grant, which the EBRD will attract from the EU.

In turn, Ameriabank supports the project by providing financing to  cover the company's VAT. The Masrik- 1 solar power plant, located in  the Mets Masrik community of Gegharkunik region and the first of its  kind in Armenia, will help increase Armenia's supply of renewable  energy while reducing its dependence on fossil fuels. According to  experts, the construction of Masrik-1 will amount to 55 million  euros, but nothing has been officially announced about the size of  the investment. - 1" will amount to 55 million euros, but nothing has  been officially announced about the size of the investment.

The head of the Armenian Energy Security Program at the United States  Agency for International Development (USAID), Abgar Budaghyan, noted  that as of 2022, the level of energy independence of Armenia is about  27%, since Armenia imports 73% of its energy resources.

He noted that last year, together with the government, new targets  were set for renewable energy. In particular, it is envisaged that in  2030 Armenia will have solar stations with a total capacity of 1  thousand MW, which should satisfy 50% of domestic consumption from  renewable energy sources.  In 2040, this figure, according to him, is  planned to be improved by building an additional capacity of 500 MW  of solar energy and 500 MW of wind. As a result, the share of  domestic consumption from renewable sources will be increased to 60%.

According to the RA Statistics Committee, the volume of solar energy  production in Armenia in January- May 2024. grew by 26.4% per annum,  amounting to 349 million kWh.

Source:finport.am

June 27, 2024 EBRD to issue EUR 236mln loan to Armenia for Sisian-Kajaran road  construction

The European Bank for Reconstruction and Development (EBRD) will provide Armenia with a  loan of 236 million euros for the construction of the southern section of the Sisian-Kajaran highway of the North-South transport corridor. At a meeting on June 27, the RA Government approved a draft decision on ratification of the agreement with the Bank, which will be sent to the National Assembly of the country in due course.

According to the explanatory note, the agreement was signed on May  15, 2024. As part of the agreement, an asphalt concrete road with a  length of 24, 25 km will be built, which will reduce the length of  the Sisian- Kajaran section of the road. The implementation of the  project will also make it possible to increase the speed from 50 km/h  to 100 km/h. In addition, driving comfort and safety will increase.  The construction of the road section will also help increase trade  turnover, reduce transport costs, attract transit transport and  develop tourism. The construction work of the road section includes  the construction of a three-lane road with asphalt concrete surface,  the construction of 5 tunnels, 11 bridges, 68 guardrails and 43  retaining walls. The project is scheduled to be completed by November  2032.

The construction of this road of strategic importance will ensure  unhindered communication from the southern border of Armenia to the  border of Georgia, as well as to the Black Sea ports, will allow for  freight and passenger transportation that meets European standards,  and will provide serious opportunities for the development of all  settlements from the south to the north of Armenia. The investment  program of the new section of the Sisian-Kajaran road, including the  Bargushat tunnel, with a length of 60 km, is planned to be  implemented in three directions: the northern section with a length  of 27.12 km, the section of the Bargushat tunnel with a length of  8.65 km, the southern section with a length of 24.25 km.

In order to ensure long-term sustainable development, the Republic of  Armenia faces large-scale tasks to modernize and develop basic  infrastructure. Considering the lack of direct access to the sea,  improving transport links and reducing transport costs are among the  priorities of the RA government. In order to increase transport links  between territories within the country, break out of relative  transport isolation and realize the country's transit potential, the  Government of the Republic of Armenia decided to implement a national  large-scale project for the construction of the North-South  automobile corridor.

The estimated cost of the entire project for the construction of the  southern section is 452 million euros.  The project is planned to be  financed through loans provided by the EBRD and the European  Investment Fund with co-financing from the Government of the Republic  of Armenia. The required loan funds to finance the southern section  amount to 373 million euros, of which 236 million euros are planned  to be raised from the EBRD, and 137 million euros from the EIB,  co-financing from the Government of the Republic of Armenia will  amount to 79 million euros.

Let us also recall that $150 million was provided for the  construction of the southern section of the North- South transport  corridor by the Eurasian Fund for Stabilization and Development, the  funds of which are managed by the Eurasian Bank for Reconstruction  and Development. Previously, the Asian Development Bank provided $500  million for the creation of the corridor.

Source:finport.am

June 20, 2024 Armenian government, KfW to extend loan programme

The Government of the Republic of Armenia and the German bank KfW will extend the  implementation of the program "Integrated management of water resources of the Akhuryan River" until December 30, 2026. At a meeting on June 20, the Cabinet of Ministers of Armenia approved the  signing of a letter of agreement with the Bank.

As noted in the rationale for the draft decision, the agreement on  the implementation of the program was signed in 2014. As of December  19, 2023, of the 50 million euros provided for in the loan agreement,  about 41.9 million euros are available for the construction of the  Kaps reservoir.  However, due to the high bid of 61.5 million euros  (excluding contingencies and taxes) received as part of the tender  for civil works for the construction of the Cape Reservoir and  auxiliary structures, in agreement with the German Federal Ministry  for Economic Cooperation and Development, it was decided to fill the  shortfall financing the construction of the reservoir with funds in  the amount of 17.4 million euros, and the rest of 2.2 million euros  will be covered by co-financing from the Government of the Republic  of Armenia. Construction is scheduled to be completed in the second  quarter of 2026, and several more months will be required for  testing, detection of defects, and paperwork.

The Kaps reservoir under construction is located in the Shirak  region, 22 km north of the city of Gyumri, in the valley of the  Akhuryan River.

The program, with a budget of 60 million euros (50 million euros loan  funds), is financed by the government of Armenia and the German bank  KfW. The loan agreement came into force on June 29, 2019, the  deadline for using the funds was set until December 30, 2019, but was  then extended until June 30, 2024. At the first stage of the  "Combined Water Resources Management/Akhuryan River, Stage 1"  program, it is planned to build a reservoir with a capacity of 25  million cubic meters of water.  

At the second stage it is planned to increase the cubic capacity to  60 million cubic meters. The project involves the construction of  auxiliary structures for the Cape Reservoir dam, equipping  hydrological observation points of the Akhuryan River (from the Arpi  reservoir to the Akhuryan reservoir), the construction of additional  stations, and the creation of a centralized database (SCADA system).   Completion of the construction of the dam and auxiliary structures  will primarily ensure the safety of settlements in the lower reaches  and increase the level of water supply to lands with an area of  12,325 hectares in the Shirak region and on the right bank of the  Akhuryan reservoir. 

It will be possible to replace mechanical irrigation of 2,280  hectares of land with gravity irrigation, which will save 1.3 million  kWh of electricity per year. As a result of regular irrigation,  agricultural production will increase, and the installation of a  reliable water metering system will improve the level of water  management and monitoring.

Source:finport.am

June 3, 2024 Armenia`s transition to clean energy and power transmission grid  upgrades to benefit from World Bank support

The World Bank's Board of Executive Directors approved $40 million in support of the Enabling  the Energy Transition project for Armenia, which will assist the implementation of the Energy Sector Development Strategy to 2040 of the Republic of Armenia.  

The investments will focus on the rehabilitation of power transmission substations, the adoption of  reforms to allow the transmission company to access private financing, and the promotion of energy sector modernization as well as regional energy cooperation among emerging and developing economies in the Europe and Central Asia region.

Armenia's power sector is heavily dependent on imported fuels,  especially natural gas, which creates significant energy security  risks, compounded by the global energy crisis. Attracting private  investment is essential to fund the large-scale projects needed in  the sector. In 2021, 62 percent of Armenia's total energy supply came  from natural gas, followed by oil (16 percent), nuclear (14 percent),  and hydro (5 percent), whereas the share of nontraditional renewable  energy sources (wind and solar) was only about 1 percent. 

"To ensure affordable, reliable, and clean electricity supply for  consumers, Armenia needs continued investments in modernizing the  power transmission network and improving the commercial viability of  the High-voltage Electric Networks of Armenia JSC, the transmission  company. Moreover, we expect this project to help reduce greenhouse  gas emissions - crucial for mitigating climate change," said Carolin  Geginat, World Bank Country Manager for Armenia.

The project aims to facilitate the integration of an estimated 1.1 GW  of renewable energy generation capacity into the transmission grid by  2032, which is enough to power over 690,000 households. This will  reduce the annual emissions of net greenhouse gas (GHG) by 540,000  tons. Additionally, it seeks to attract private investment totaling  $550 million, upgrade all transmission substations with automated  control and digital protection systems, and increase the total  capacity of transmission substations from 2,711 megavolt- amperes  (MVA) to 3,109 MVA. These efforts are part of a comprehensive  strategy to enhance renewable energy adoption, minimize environmental  impact, and modernize the grid for increased efficiency and  reliability. 

The project is part of the Europe and Central Asia Renewable Energy  Scale-Up Multiphase Programmatic Approach (ECARES MPA) Program, with  an overall financing envelope of $2 billion equivalent, which was  approved by the World Bank's Board of Executive Directors on March  28, 2024. The ECARES MPA is designed to increase renewable energy  capacity in participating countries of the Europe and Central Asia  region, support the acceleration of their renewable energy  transition, and achieve scale and impact through private investment,  while also fostering regional knowledge sharing.

Source:finport.am

May 21, 2024 World Bank expresses readiness to help Yerevan develop solid waste  management policy

Yerevan Mayor Tigran Avinyan met with a delegation led by Sameh Wahba, World Bank Regional  Director for Sustainable Development at the Europe and Central Asia region.

The mayor was presented with the results of the assessment in the  field of solid waste management and proposals were made. In  particular, the World Bank delegation proposed developing a policy in  this sector, a road map that would determine further steps, as well  as short-term and long-term goals.

Attaching the importance of joint projects, Tigran Avinyan emphasized  that the sector requires systemic solutions. He noted that Yerevan is  ready to discuss any proposals that can effectively solve the  problems that have accumulated over decades.

Stressing the importance of expanding cooperation with the Yerevan  Municipality and implementing new joint programs, Sameh Wahba, in  turn, noted that the Bank is ready to support the community, both in  terms of providing advisory support and in terms of implementing  practical programs.

Source:finport.am

May 3, 2024 EBRD and GCF support green investments in Armenia

• Inecobank to receive US$ 10 million loan under EBRD’s Green Economy Financing Facility
• Loan will support SMEs and corporates investing in green technologies
• Project is jointly financed by the EBRD and the Green Climate Fund

Businesses in Armenia will have more opportunities to invest in green technologies thanks to a US$ 10 million (€9.3 million) loan, which the European Bank for Reconstruction and Development (EBRD) and the Green Climate Fund (GCF) are providing to Inecobank for on-lending to corporates and small and medium-sized enterprises (SMEs) for green investments.

The EBRD will provide US$ 7.5 million (€7.0 million) and the GCF will co-finance with US$ 2.5 million (€2.3 million). The GCF is the world’s largest international climate fund. It was created in 2010 under the United Nations Framework Convention on Climate Change and supports low-emission and climate-resilient programmes in developing countries.

The funds to Inecobank are being provided under the EBRD’s Green Economy Financing Facility (GEFF), a framework designed to support businesses in their green transition journey and in investing in climate-adaptation and mitigation technologies. These technologies also help businesses to enhance their productivity and reduce costs.

The GEFF will contribute towards building a greener economy in Armenia by supporting the expansion of green finance in accordance with the EBRD’s Green Economy Transition (GET) approach. Possible investments include technologies that boost the sustainable use of energy and water resources such as thermal insulation, photovoltaic solar panels, geothermal heat pumps, electric vehicles, electric-vehicle-charging infrastructure and water-efficient irrigation systems. Businesses can identify the green technologies available in Armenia through the GEFF Technology Selector 

Companies interested in securing a loan for green technologies can also avail of investment incentives funded by the Climate Investment Funds through the GEFF programme.

Inecobank is one of the leading banks in Armenia and a longstanding partner of the EBRD. It is well positioned to reach corporates and SMEs country-wide, including technology suppliers, producers, vendors and installers that could benefit from green technologies.

Since the start of its operations in Armenia in 1992, the EBRD has invested €2 billion in 210 projects in the country’s financial, corporate, infrastructure and energy sectors, with 92 per cent of those investments in the private sector.

Source:www.ebrd.com

April 30, 2024 World Bank Supports Armenia’s Green, Inclusive and Sustainable Development

The World Bank’s Board of Executive Directors approved a Development Policy Operation (DPO) in the amount of $116 million equivalent for Armenia to enable reforms aimed at promoting green, resilient and inclusive development.

The DPO includes loan financing from the International Bank for Reconstruction and Development (IBRD) in the amount of EUR 92.3 million ($100 million equivalent) and a grant from the Global Concessional Financing Facility (GCFF) in the amount of $16 million.

 This budget support will help the Government of Armenia to build climate resilience and reduce vulnerabilities to future shocks.

“This development policy operation supports a package of reforms designed to improve social equity, strengthen human capital, support the emergence of stronger institutions, and promote climate mitigation and adaptation in Armenia,” said Carolin Geginat, World Bank Country Manager for Armenia.

The operation supports the Government’s five-year action plan for 2021-2026. It includes actions that will fortify anti-corruption measures by implementing a robust framework with a whistleblowing system and gift monitoring mechanism for public servants.  Further, it is aligned with the Paris Agreement. Specifically, the operation will support the government’s reforms in the following areas:

Fostering climate change mitigation and adaptation and improving the regulatory framework for environmental management;

Enhancing equity and promoting human capital development;

Strengthening the anti-corruption framework and improving justice sector efficiency.

Since starting its operations in Armenia in 1992, the World Bank has provided around $2.7 billion from IBRD, International Development Association (IDA), and various trust funds. Armenia became a donor to IDA in 2023. The World Bank is committed to continuing its support to Armenia in its development path for reducing poverty on livable planet.

The GCFF is Financial Intermediary Fund, established in 2016 to provide concessional financing to eligible middle-income countries. The GCFF contributions made available to Armenia under this operation were provided by the Governments of the Netherlands and the United States of America.

Source:arka.am

April 26, 2024 Election of EBRD President to be held in Yerevan

Election of President of the European Bank for Reconstruction and Development (EBRD) will be held within the framework of the EBRD Annual Meeting and Business Forum to be held in Yerevan on May 14-16. EBRD Resident Office in Yerevan said.

With the theme of Delivering Impact Together, this prestigious event will bring together industry experts, business leaders and EBRD members to share their perspectives. 

The programme will also include country- and region-specific sessions, as well as presentations on the Bank’s latest economic forecasts.   

On May 14, a unique event will be held at the Tumo Center, where innovative programs developed by the center's students will be presented.

A session dedicated to investment forecasts in Armenia will be held on May 15. Many country- and region-specific sessions will be organized, with discussions on how to help economies in the EBRD regions thrive by adapting to an ever-changing environment. Specialist panels will debate thought-provoking topics on the macroeconomic landscape, improving access to finance, renewable energy, natural resources, sustainable infrastructure, economic inclusion, and digitalisation and technology, to name but a few.   

The EBRD is one of the leading institutional investors in Armenia. Its main priorities in Armenia include enhancing the competitiveness of companies and supporting financial sector intermediation through risk-sharing products.

EBRD has invested over €2 billion in 207 programs in the country in areas such as energy, infrastructure, telecommunications and finance.

Source:arka.am

Event website: EBRD 2024 Annual Meeting & Business Forum

April 19, 2024 Armenian PM receives delegation of German KfW Bank

Armenian Prime Minister Nikol Pashinyan received a delegation from the German Development Bank (KfW), as reported by the Prime Minister's Office.

Discussions revolved around the potential implementation of new energy sector projects in Armenia with the involvement of the bank.

Pashinyan underscored the ongoing development of cooperation between Armenia and Germany, highlighting the significant role played by the collaboration between the Government of Armenia and KfW in fostering these relations.

Thomas Eisenbach, the Head of Division for Energy and Natural Resources Eastern Europe, Caucasus and Central Asia KfW Development Bank, underscored KfW's readiness to assist the Armenian government in implementing new projects. Discussing ongoing projects in various sectors, Eisenbach highlighted the significance of collaborative efforts. He expressed confidence that joint programs would foster the sector's sustained growth.

The participants discussed various issues concerning the progress of ongoing projects and the potential implementation of new programs.

Source:armenpress.am

April 18, 2024 Prime Minister receives the delegation of the German Fichtner company

Prime Minister Nikol Pashinyan received the Executive Director of the German Fichtner company operating in the energy sector, Martin Stickel, and the company's representatives. Viktor Richter, Ambassador Extraordinary and Plenipotentiary of Germany to Armenia, also participated in the meeting, the PM's office said.

The Prime Minister welcomed the visit of the delegation of the German company to Armenia as a result of the meeting held in Munich in February of this year and emphasized the development of the renewable energy sector in our country.

Issues related to further cooperation between the Armenian government and Fichtner company were discussed.

It was agreed to continue discussions with the Ministry of Territorial Administration and Infrastructure, as well as the Ministry of Economy, for coordinating future activities.

Source:armenpress.am

April 17, 2024 Armenia`s Deputy PM, Veolia Vice President discuss problems with

Deputy Prime Minister of the Republic of Armenia Tigran Khachatryan received  Philippe Guitard, the Senior Executive Vice President of Central & Eastern Europe at Veolia Environnement. The meeting was also attended by Deputy Minister of Territorial Administration and Infrastructure Vache Terteryan and  General Director of Veolia Djur Marianna Shahinyan.

During the meeting, as the press service of the RA government  reports, the interlocutors touched upon a number of issues of mutual  interest. The discussion, in particular, was about improving the  quality of water supply, reducing water losses, wastewater treatment  and other issues related to drinking and irrigation water supply  systems.  Since January 1, 2017, the new single water operator - the  French  "Veolia Djur" (a subsidiary of the French Veolia Enviroment  SA), took  over the management of the property of five existing  operators for a  period of 15 years:  "Yerevan-Jur", "Armvodokanal",  "Shirak Vodokanal"  ", "Lori Vodokanal" and "Nor Akunk".  Earlier,  the head of the Public Services Regulatory Commission, Garegin  Baghramyan, reported that Veolia Djur leased the water supply system  and has an obligation to annually invest 3.7 billion drams per year  in the sector. The company increases the volume of annual investments  to 4-5 billion drams. However, according to Baghramyan, this is a  drop in the ocean, and investments are mainly directed to solving  issues that require urgent solutions, for example, eliminating  accidents.

Source:finport.am

April 4, 2024 Armenia to join the International Solar Alliance

The Armenian government on Thursday approved the ratification of the framework agreement on the establishment of the International Solar Alliance.

The aim of the agreement is to unite joint efforts in the field of solar energy development, by harmonizing technologies, innovations, financing, welfare, energy security and stable development of states.

Armenia, which signed the document on November 16, 2023, will be the first country in the region to join the agreement.

The International Solar Alliance was established by the joint efforts of India and France to combat climate change and utilize solar energy resources. The Alliance was conceptualized in 2015 on the sidelines of the 21st Conference of the United Nations Framework Convention on Climate Change (COP21) held in Paris.

In 2020, the Alliance amended the Framework Agreement to enable all UN Member States to join the Alliance. Currently, 116 states have signed the Framework Agreement, 94 of which have submitted the necessary ratification documents to become full members of the Alliance.

The governing body of the Alliance is the Assembly, convened once a year at the level of the respective ministers of the member countries. The Alliance is headquartered in India.

Source:arka.am

March 23, 2024 AFD delegation presented with details of Vedi reservoir construction  and irrigation network modernization project

It is very important to institutionally strengthen and increase the capacity of water supply and sanitation services in rural settlements of Armenia. Deputy Minister of Territorial Administration and Infrastructure of the Republic of Armenia Vache Terteryan stated during a meeting with a delegation headed by Director of French Development Agency's (AFD) regional office in the South Caucasus Fanny Delpey.

According to the press service of the department, the Deputy Minister presented to the guests the details of the construction of the Vedi reservoir and the modernization of the irrigation system, projects for the development of irrigated agriculture in the Ararat and Armavir regions. Minister Terteryan also spoke about the opportunities to support the comprehensive development of the Syunik region of the Republic of Armenia, the ongoing national policy and planning of water resources, improving the management of irrigation systems and the provision of services in the context of the Water Irrigation Services Enhancement (WISE) project.

During the meeting, issues related to the process of technical assistance to the AFD aimed at managing public investments were also discussed.

Earlier, ArmInfo reported that the construction of the Vedi reservoir, which should be put into operation this year, continues in Armenia with loan funds from the French Development Agency of 75 million euros. In general, it is planned to build 15 small reservoirsin the country by 2026. Previously, tenders were announced for the design of six small reservoirs, of which five tenders were held. Currently, the process of developing a feasibility study for these five reservoirs is underway. Out of 15 reservoirs, at least 4 have encountered problems associated with a decrease in water flows, and therefore the issue of changing their construction site is being discussed. Work also continues on the construction of large reservoirs. In particular, during the implementation of the Vedi reservoir construction project, more than 70 meters of the 85-meter dam were built.

On January 26, 2016, in order to finance the construction of a reservoir in Vedi, the French Development Agency allocated a loan of 75 million euros to the Republic of Armenia (co-financing from the Government of the Republic of Armenia will amount to 15 million euros), within the framework of which it is planned to build a reservoir with a volume of 29.4 cubic meters and a water surface of 120 hectares. The sources of water will be the rivers of the Ararat region - Vedi and Khosrov. Full implementation of the program will make it possible to alleviate the problem of water shortage in the Ararat Valley, as well as move from mechanical irrigation to a gravity supply system, which, in turn, will lead to energy savings. The project was initially planned to be completed within four years, but at the end of May 2022, according to the RA government, the project was completed by 77 percent.

As for the restoration of the Kaps reservoir, KfW Bank announced its agreement to finance this project. The Kaps reservoir, unfinished due to the 1988 earthquake, with a design capacity of 110 million cubic meters of water, is located in the Shirak region, 22 km north-west of the city of Gyumri, in the valley of the Akhuryan River. The program, with a total budget of 70 million euros, is financed by the German Development Bank -KfW. The loan agreement came into force on June 29, 2019, the deadline for using the funds was set until December 30, 2019, but was then extended until June 30, 2024. At the first stage of the program, it is planned to complete the construction of a reservoir with a capacity of 25 million cubic meters of water. At the second stage, it is planned to increase the infrastructure to 60 million cubic meters. The project provides for the construction of auxiliary structures for the Cape Reservoir dam, equipping hydrological observation points of the Akhuryan River (from Lake Arpi to the Akhuryan Reservoir), construction of additional stations, and creation of a centralized database (SCADA system).

Source:finport.am

March 20, 2024 Armenia to receive 12 million euro loan from Germany for renewable energy development

The Armenian National Assembly on Wednesday ratified an agreement between the governments of Armenia and Germany, whereby the latter will provide a 12 million euro loan for the development of renewable energy. 

 The loan will be granted with a grace period of 7 years and 0.9% interest rate. It should be repaid until 2043 at.

This loan is not provided to the government, but to the private sector through the German-Armenian Fund operating under the Central Bank of Armenia.  

Under the program, solar plants with a capacity of up to 500 kW will be built for legal entities, up to 150 mW for individuals, and 1 mW for autonomous groups.

Source:www.armbanks.am

March 11, 2024 Launch of EEU single energy market may be postponed until 2027, says deputy minister

The launch of the single energy market for countries, which are members of the Eurasian Economic Union (EEU) that was initially planned for 2025 is being postponed until 2027 because the member states have failed to reach consensus on a number of issues, Armenian Deputy Minister of Territorial Administration and Infrastructures Hakob Vardanyan told a meeting of the parliament committee on regional and Eurasian integration.

According to him, Russia and Kazakhstan insist that the single market should operate in parallel with bilateral gas supply agreements until the latter expire.

Vardanyan said the Russian-Armenian agreement on supply of natural gas is valid until 2043.

’We believe that parallel action is impossible, because the entire volume of supplies is regulated by a bilateral agreement, and in its current form, the agreement on the single market will not be so effective not only for us, but also for everyone,” Vardanyan said.

Another issue on which the parties did not reach an agreement is the formation of a single price for consumers. The deputy minister said that there is agreement that the price for gas should be the same for everyone at the natural gas field, after which the question arises of how the price for supplies should be formed.

“Russia and Kazakhstan insist that they have a large multi-level subsidy programs, and the price for the Russian consumers cannot be the same as, for example, for the Belarus and Armenia. Therefore, they believe that there should be a two-stage pricing system: one for the domestic market, the other is for other EEU countries,” he said.

Source:arka.am

March 7, 2024 Connection with Europe via Georgia Armenia`s energy priority -  official

The Ministry of Territorial Administration and Infrastructure is preparing a  strategic document in the field of water resources management, stated Deputy Minister of Territorial Administration and Infrastructures Vache Terteryan during a meeting with delegations of the German  Society for International Cooperation (GIZ) and the German Development Bank (KFW). Deputy head of the department Hakob Vardanyan was also present at the meeting.

Terteryan noted that the document will be presented to donor  organizations with the expectation of close cooperation. In  particular, the deputy minister emphasized that there is a need to  develop a model of treatment facilities, noting the importance of  interaction with the German side in this area.

According to the press service of the department, Hakob Vardanyan, at  the request of the guests, presented the progress of the  implementation of the Caucasus Power Transmission Network program,  which provides for the construction of an Armenia-Georgia power line  and substation. He emphasized that the program is the focus of the  Ministry. Hakob Vardanyan also noted that at this stage the priority  for Armenia is communication with Europe through Georgia, which will  allow diversification of the energy sector.

The parliamentary hearings on the draft state budget of the country  2024 In October 2023, the Minister of Territorial Administration and  Infrastructure of the Republic of Armenia Gnel Sanosyan stated that  there is every reason to assume that work on the construction of the  Armenia-Georgia high-voltage power transmission line will begin in  2024.

The project for the construction of the North-South energy corridor,  designed to unite the electric power systems of Iran, Armenia,  Georgia and Russia, has encountered a number of problems. Initially,  the construction projects of 400/500 - kilovolt power lines  Iran-Armenia and Armenia-Georgia were planned to be completed by the  end of 2019. Meanwhile, as of today, work on the Iran-Armenia power  line has been completed by 20-25%, and the construction of the  Armenia-Georgia power line has not yet begun.

Source:finport.am

February 28, 2024 PSRC: construction of Mets Masrik  industrial-scale solar power plant  in Armenia is nearing completion

The construction of an industrial-scale solar power plant, Mets Masrik, in Armenia is nearing completion. This was stated on February 28 from the rostrum of parliament by Chairman of the Public Services Regulatory Commission, Garegin Baghramyan, whose candidacy was again nominated by the RA government for the post of head of the PSRC.

Baghramyan emphasized that the construction of a Mets Masrik solar power plant is carried out within the framework of a public-private partnership. A similar partnership mechanism is used major solar energy project - the Aig-1 power plant as well, which is to be built by the Masdar, UAE company. If in the first case the project is nearing completion, then in the second case it has not yet begun. Moreover, the consortium that is supposed to build Aig-1 has not yet even received a license to build the facility, the cost of which is estimated at $180 million and a design capacity of 200 MW. Some financial terms are currently being negotiated within the public-private partnership. Only after that, the investor should apply to the PSRC to obtain a construction license.

Baghramyan emphasized that in addition to the abovementioned facilities, solar power plants with a total installed capacity of 370 MW have already been built in the country. If the conditions of licenses issued to 43 persons are met, these volumes will increase by another 410 MW.

On July 19 last year, PSRC issued a license for the production of electricity from Mets Masrik. Fotowatio Renewable Ventures (FRV), member of Abdul Latif Jameel and a leading global developer of renewable energy projects, together with IFC, EBRD and Ameribank,successfully completed a deal to finance the construction of the largest solar power plant, Masrik-1, with a capacity of 55 MW, which will generate more than 128 gigawatt-hours of electricity per year at a competitive rate of $41.9 per MWh to power more than 20,000 homes and avoid the emission of more than 40,000 tons of carbon per year. As part of the project, an electricity purchase agreement was signed with the Electric Networks of Armenia company, which will distribute the electricity produced. The International Finance Corporation (IFC) and the European Bank for Reconstruction and Development (EBRD) supported the project by providing priority loans and an investment grant, which the EBRD will attract from the EU. In turn, Ameriabank supports the project by providing financing to cover the company's VAT. The Masrik-1 solar power plant, located in the Mets Masrik community of Gegharkunik region and the first of its kind in Armenia, will help increase Armenia's supply of renewable energy while reducing its dependence on fossil fuels. According to experts, the construction of Masrik-1 will amount to 55 million euros, but nothing has been officially announced about the size of the investment.

Source:finport.am

February 18, 2024 The Prime Minister meets with the leadership of the Fichtner company operating in the energy sector

Prime Minister Nikol Pashinyan had a meeting in Munich with the Executive Director of the Fichtner company operating in the energy sector, Martin Stickel, and the company's representatives.

Issues related to cooperation and exchange of experience in the field of green hydrogen energy and the construction of storage plants were discussed.

The Prime Minister attached importance to the development of the above directions in Armenia and noted that the Armenian government is interested in deepening the cooperation with the German company.

An agreement was reached to continue discussions on the possibilities of cooperation.

Source:www.primeminister.am

February 12, 2024 Armenian official, ADB reps discuss construction, management projects

Armenia's Deputy Minister of Territorial Administration Vache Terteryan held a meeting  with a delegation of the Asian Development Bank (ADB) led by Mr Don Lambert, Country Director for ADB's Armenia Resident Mission.

According to the press service of the Ministry of Territorial  Administration and Infrastructure of the Republic of Armenia, the  director of the Armenian office of the ADB said that the purpose of  the visit is to discuss issues related to the construction of  reservoirs and irrigation systems, the construction of schools, solid  waste management, as well as projects aimed at improving water  quality Lake Sevan.

Speaking about reservoir construction projects and especially about  the Kaps reservoir construction project, Terteryan pointed out the  possibility of active and effective cooperation between ADB and other  international partner structures participating in the project. The  interlocutors also emphasized the importance and necessity of the  construction and reconstruction of irrigation systems.

Regarding the school construction program, ADB representatives spoke  about their approaches, upcoming programs, emphasizing the economic  efficiency of schools under construction and issues of further  maintenance of buildings after completion of construction.

In this regard, Terteryan noted that this process is one of the  strategic priorities of the RA government, and proposed to involve  other interested departments in further discussions. Regarding the  improvement of the water quality of Lake Sevan, representatives of  the bank noted that it is possible to turn three mechanical treatment  stations on the lake into biological treatment stations.

Emphasizing the availability of treatment facilities, the Deputy  Minister also noted the importance of effective and proper management  and operation of these facilities. Speaking about solid waste  management, Vache Terteryan pointed out the need to study and justify  effective management models. Let us remind you that the cost of the  Kaps reservoir construction project is 60 million euros. It is  planned to be implemented in cooperation with the German bank KfW.  ADB's participation in this project will help attract additional  financial resources.

As for the school construction project, ADB previously allocated 66.1  million euros for this purpose.

ADB has been cooperating with the government of Armenia since 2005.  During this time, 38 sovereign and non-sovereign loans were approved,  as well as a special assistance grant. To this day, the total  investment is $1.74 billion. Armenia was also provided with 48  technical assistance grants with a total value of $25.9 million.

Source:finport.am

January 25, 2024 Armenia, UAE to further deepen cooperation in solar energy

Armenia's Minister of Economy Vahan Kerobyan hosted UAE Ambassador to Armenia Nariman  Mohammed Sharif AlMulla and Mohammed Al Shehi, the coordinator of the projects implemented by the Masdar company in Armenia.

According to the press service of the Ministry of Economy, following  the meeting, an agreement was reached on further deepening  cooperation in the field of solar energy production.

The source noted that at the end of 2023, trade turnover between the  countries reached $2.8 billion. As a result, the UAE took second  position in the list of Armenia's main trading partners. The Ministry  of Economy also reported that by October 2023, the flow of  investments from the UAE amounted to about 135,235.1 million drams,  of which 105,192.0 million drams came from the flow of direct  investments.

"Business and interstate cooperation between Armenia and the United  Arab Emirates continues to expand," the message says.

On November 26, 2021, following the results of the competition, the  Armenian government signed an agreement with the Masdar company on  the construction of a photovoltaic power plant <Aig-1> in the Talin  area with a capacity of 200 MW in the country.

Earlier, in July of this year. Masdar was recognized as the winner of  the tender for the projects for the construction of this photovoltaic  industrial station.

According to the competitive proposal, the company offered a fairly  low tariff for the future solar generation facility - $0.0290  excluding VAT for 1 kW/h of electricity. $200 million was allocated  for the construction of the Aig-1 station, operation is planned for  2025.

The beneficiary of 85% of the shares was Masdar, and 15% of the  shares belonged to the ANIF State Interest Fund.

Masdar is a subsidiary of Mubadala Investment Company, UAE, with  total assets of $220 billion and one of the world's leading renewable  energy companies.

Source:finport.am

January 18, 2024 Armenia to attract ADB loan for construction of road section

Armenia's Cabinet has approved the ratification of the EUR 60mln financial agreement  Yerevan Urban Development Investment Project with the Asian Development Bank (ADB) of November 27, 2023. 

As stated in the explanation to the document, the program with a  budget of 60,090,000 euros is aimed at developing urban  infrastructure through the construction of a new section of the  Isakov-Arshakunyats road, which will connect 3 administrative  districts of Yerevan and significantly reduce congestion in the city.  As a result of the project, it will be possible to reduce the  existing road (by approximately 1.8 km), city traffic jams, and  create new urban infrastructure (another bridge will be built across  the Hrazdan River). Planned works include: construction of the  necessary wings of the existing road junction on Isakov Avenue, which  will provide access to the Noragyukh area; a reinforced concrete  bicycle bridge 269 meters long will be built across the Hrazdan  River; An interchange with a tunnel crossing and a roundabout will be  built on Arshakunyats Avenue.

It is expected that the implementation of the program under the  Agreement will be completed on September 30, 2027.

According to Yerevan Mayor Tigran Avinyan, the project will  significantly relieve traffic on the specified section. The project  will also increase the "demand" of the Noragyukh district and create  new investment opportunities for it. In connection with the latter,  the capital's authorities are preparing to present a new concept,  Avinyan added.

The proposed Yerevan Urban Development Investment Project aims to  enhance the economy, livability, and inclusiveness of Yerevan, the  capital city of Armenia, through improved sustainable urban mobility  and services (output 1) and strengthened institutional capacity for  green and inclusive urban mobility (output 2).  It aims to support  Yerevan in improving the urban environment, enhancing the road  network, and promoting climate-resilient infrastructure. The project  will benefit up to 1.2 million people.

The project will relieve traffic congestion and significantly improve  socioeconomic connectivity and access to green urban space. The river  crossing and road capacity will be increased by one-third and travel  distances reduced by more than 2 km, thereby reducing travel time (by  10 minutes) and the risk of traffic accidents, decreasing traffic  congestion and emissions, and improving the overall environment of  the main city arteries.

The ADB has been working with Armenia since 2005. As of April 2023,  ADB's total liabilities amount to $1.7 billion. To date, the Bank has  provided Armenia with 59 loans, grants, as well as technical  assistance to the public sector in the amount of $1.3 billion, which  were aimed at developing the transport, financial, energy, and water  sectors , infrastructures, etc.

Source:finport.am