ARMENIA RENEWABLE RESOURCES
AND ENERGY EFFICIENCY FUND
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About Us / Activity

Activities for Renewable Energy Development

Specific Activiies fasilitating investments in Renewable energy
World Bank/gef grant – usd 3 mln – 2006-2010

A. Improvement of legal and regulatory framework

  • Renewable Energy Development Roadmap. It includes identification of potential in Armenia, targets for short, medium and long term perspective as well as time bound poicy measures for reaching the targets.
  • Development of norms and standards for renewable resource based power generation technologies. Preparation of several Armenian normative documents on grid connected wind power generation, PV solar and energy efficiency. They are in the adoption stage.
  • Assistance to the dispatching and control system aimed to increase RE absorption capabilities in Armenian power network. Normative document on modern microprocessor based relay protection system for Armenian power system was designed and introduced to all interested parties.
  • Identification of barriers in development of renewable energy in Armenia. Based on the analysis of the situation in market, as well as round table discussions with large number of stakeholders the main barriers were identified and submitted to the government together with proposed actions toward legislation improvement. As a result special commission was assigned by Prime Minister’s decree for analyzing and addressing issues raised by the Fund.

B. Capacity building and support to facilitate investments in renewable energy sub-projects

  • Update of Scheme of Small Hydro Power Plants. Due to attractive policy the number of SHPP was significantly increased during recent years. In order to assess further potential the Fund initiated and conducted update of SHPP scheme. Additional 115 SHPP was identified as feasible for construction with total installed capacity of 117 MW and annual production of 540 mln. KWh electricity. 
  • Support for preparation of RE business plans. Based on need assessment of potential investors instead of preparation of business plans for each project it was decided to prepare a guide with RE specific analysis and tools. Manual “Business Plan Preparation for RE Projects in Armenia” was prepared and disseminated among interested companies and individuals. At the same time the Retscreen model was presented to the audience and activate link to that site. 
  • Technical assistance in Renewable Energy tariff setting, licensing procedures, etc. Analysis and recommendations on tariff setting for Small Hydropower Plants (SHPPs) and wind power were provided to the PSRC and the Ministry. Technical Assistance to the Public Services Regulatory Commission of the Republic of Armenia includes also publishing of the “Development Trends of Small Hydropower Plants in Armenia: 2007” and “Development Trends of Small Hydropower Plants in Armenia: 2008” brochures (600 booklets).
  • Developing of the Geographic Information System (GIS) of Armenia

Special renewable energy oriented geographical information system of Armenia is prepared with more than 12 thematic layers, including: shadow relief layer of DEM (90 m resolution), coded layer of main rivers (20 m resolution); catchments areas of the main rivers; coded layer of natural lakes; coded layer of artificial reservoirs and basins; coded layer of all communities with there boundaries; several climatological layers (average annual temperature, precipitation, solar global radiation).

  • Assistance to the modern Solar PV development in Armenia. The main objective of this international study (US, Denmark, Switzerland, Russia, Armenia) was to assess modern PV production (cells, elements, components, units) development potential in Armenia, from the point of view of competitive advantage for Armenia, creating marketable end-products and/or maximum value added for all the value chain of modern PV (“from mines to market”).
  • Assistance to the bioethanol production development in Armenia. The main objective of this international study (US, Armenia) was to assess bioethanol production potential and perceptiveness in Armenia, and develop a preliminary assessment of a bioethanol production project, to be introduced in Armenia.
  • Determination of high potential geothermal site(s) in Armenia. During the implementation of this project the determined list of perspective sites were reported to the WB and serve as a basis for receiving of the new GEF/GeoFund grant ($1,8 mln.) for Geothermal project in Armenia. Currently scouting and magneto-telluric works in two potential sites are completed and the international selection of consultant for 3D seismic survey is on going.
  • Assessment of hydropower potential for peak power production for Armenia and the region. The regional power flow dynamics were analyzed. The potential for peak power production via pumped storage hydropower plant was assessed. Perspective sites for pumped storage hydropower plant were selected and presented to the Ministry of Energy and Natural Resources.
  • Organization of road shows, publications and conferences. The Fund organized Renewable Energy Week with participation of all players in the energy efficiency and renewable energy field in Armenia in fall of 2008. The potential and perspectives of renewable energy development in Armenia were presented during ArmTech’07 (San-Francisco, USA) and ArmTech’08 (Yerevan, RA) international conferences with more than 400 participants. The Fund is participating in Armtech 2009 planned for November 5-8, 2009 in San Jose, USA. The Fund organized and sponsored number of events, including exhibitions and workshops. More than 40 special seminars and round tables were organized on different aspects of renewable energy and energy efficiency development in Armenia, including small hydro, Solar PV, bioethanol production, geothermal power, legislation and normative issues, financial market, gas safety, school heating, environmental issues and training sessions, etc.

Financing investments in Renewable energy

The Fund operates two revolving funding mechanism for energy efficient heating and for renewable energy projects. Renewable energy funding portfolio consists of three funding sources – R2E2 Fund ($5 mln), EBRD ($7 mln.) and Cascade Capital holdings ($3 mln.). Cascade Bank is universal credit organization which carries the risk for overall portfolio. The amounts repaid to the Fund will be allocated for the financing of other renewable energy projects.
Within short period of time (2007-2009), through this mechanism construction of 26 SHPPs was constructed, 17 of which have already started generation of electricity.
During implementation of project we are in day to day contact with Cascade and EBRD to ensure efficient implementation. The experts of the Fund perform on-site environmental and technical monitoring, control over procurement of works and goods under its credit, etc.

Specific Activiies in heating sector

After energy crisis in 90s Armenian district heating system covering almost all urban areas was destroyed. Due to the Soviet tariff system residents of multi-apartmental buildings used to pay pennies for heating services, so they did not afford payment of real cost of heat delivered. Number of problems starting from inefficient boilers and huge external network, illegal water taping and ending with non-payments made the centralized heating not the best option for Armenian households. Apartments’ owners use almost all type of fuel for heating purposes, i.e. liquid fuel, wood, waste, etc. Number of incidents (explosions, poisoning and fires) was significantly increased during heating seasons. Electricity is the most expensive heating option and it is not affordable for most of population.
In order to increase the use of safe and affordable heating technologies in urban multi-apartment buildings the World Bank extended credit to the Government of Armenia in an amount of $15mln for implementation of Urban Heating Project, of which the $4.2 mln. was provided to the Fund by the Government as a soft loan with 8 years maturity. For implementation of the project Government signed Agency Agreement. Additional $1,8 mln was allocated to the Fund from the state budget. Project was started in 2006.   
Enabling environment for safe heating -$1 mln.
Under this subproject the Fund developed two large technical regulation related to technical safety of domestic gas appliances. Both regulations were adopted by the Government Decrees. More than 15 European standards (EN) were translated and adopted for Armenia. Comprehensive guidelines on gas safety regulation was developed and provided to the Government and the gas company.
In order to increase awareness on energy efficiency, particularly for heating the Fund initiated large information campaign covering all regions of Armenia. It included:

  • Annual exhibitions of heating technologies (4 expos)
  • TV programs (more than 10 in countrywide broadcasting channels, 6-7 in local TV)
  • Film about activities under the project (3*25 min.)
  • More than  14 workshops in all urban areas of Armenia,
  • Two guidelines were developed for training of technical staff,
  • Publication of leaflets, booklets, brochures (more than 12 materials with thousandths of copies)
  • Large conferences and seminars for policy makers, bankers, international experts, etc.
  • 16 training sessions for technical staff to create employers for firms supplying energy efficient equipment,
  • Guidelines (handbook) for operation of modern energy efficiency boiler house and heating system was prepared and distributed.

Annual statistical survey conducted under the project reflects impact of the project to the heating options of urban apartment owners. The results of surveys are very valuable source of information for almost all of the stakeholders, i.e. decision makers, experts, international organizations, NGOs, etc. The reports are distributed during the expos and other  
On lending to the banks – $4,2 mln.
The Fund extended loans to the banks selected based on eligibility criteria. Total amount of disbursed tranches is $4,2, of which $0,5 mln. was repaid by the bank and will be allocated to the banks for the heating purposes. Repayment rate is 100%.

Capital grants to the poor ($6,4 mln., of which $3.1 mln was provided to the fund by the gpoba (IFC, DFID trust fund )).
To enable the poorest households living in multi-apartment buildings to participate in the project and thus gain access to improved heating, the Fund financed the cost of energy efficient heater installation, as ell as connection of the apartment to the gas network. About 12000 households applied to the Fund during the past three years, of which 8000 has already been provided with assistance.

School heating ($6.0 mln.)

The Fund as an agent for government implemented school rehabilitation works through contracting for engineering design, civil works, and technical supervision. Instead of 100 schools envisaged the Fund has completed boiler house and entire heating network construction works in 120 schools comprising 13 schools with additional energy conservation measures (wall, attic thermal insulation, windows, doors replacement etc). In selected urban schools the investments in installation and rehabilitation of gas-based local heating systems and basic thermal rehabilitation was provided as a grant. All schools are located outside Yerevan. Schools were selected based on the cost-effectiveness of the investment per student.
Energy Efficiency project design for implementing in municipal and public building (schools, hospitals, etc).
Fund developed energy efficiency database for more than 2500 public buildings outside Yerevan, including all urban areas of Armenia, elaborated selection methodology for highest energy efficient potential facilities, implemented 8 Investment Grade and 14 Walk-Through Energy Audits, assisted for Energy Efficiency Action Plan acceptance, investigated competence of industries producing energy efficient building materials for Armenia. Facilities of the Fund