Iranian solar market set to boom as SATBA takes over authority on renewable energies

pv magazine: Mr. Mousavi, solar is finally forecast to grow considerably this year in Iran. Which is your outlook for 2017? How much solar will be connected to the grid?

Mousavi: I expect Iran will reach a cumulative renewable energy generation capacity of approximately 700 MW at the end of 2017, of which the vast majority will be represented by solar power projects. Currently the country has around 32 MW of installed PV power. This comes from three large-scale PV plants and several residential and commercial PV systems installed under net metering.

Why has it taken so long for the market to grow? The FIT scheme was launched two years ago.

A very important action was taken by the Iranian government two months ago, when it transferred the responsibility of implementing the country’s renewable energy plan from the Renewable Energy Organization of Iran- (SUNA) to Renewable Energy and Energy Efficiency Organization (SATBA), which is under the direct control of the Ministry of Energy. The SATBA has more financial resources and more power. The SUNA had some problems to pay on time the power contracted under a 20-year PPA. I am quite sure that now investors will be more confident in our solar market.

Do you believe that the current FIT levels are encouraging investment in large-scale solar in Iran?

Yes, we have very attractive FITs ranging from €.020/kWh for PV projects with the capacity of 20 kW and less than €0.08/kWh for PV projects above 30 MW. Commercial PV projects with a power of up to 100 kW also have good potential thanks to a tariff of €0.17/kWh. Furthermore, PV projects between 100 kW and 10 MW are entitled to a tariff of €0.12/kWh, while PV plants ranging from 10 MW to 30 MW have access to a FIT of €0.10/kWh.

How much of the newly installed PV capacity expected for this year will come from projects built will locally manufactured solar modules?

Although solar projects complying with domestic content requirement included in our regulation for renewables are entitled to receive a FIT that is 30% higher, not a single project of this kind will be part of the capacity expected for this year. Currently, there are some solar module producers with total nominal capacity of 45 MW, and also some solar module manufacturing facilities under construction in Iran. Hedayate Noor (Shahid ghandi yazd), Electronic Sazan Semnan and Aria Solar are the most important module manufacturers in Iran.

During the past years, several announcements for solar factories in Iran were made. Is there any big player planning to produce modules in the country?

As I said, as for now, we only see the construction of these three factories. Some companies are under construction and have not manufactured any modules yet.

Net metering offers an interesting tariff of around $0.15 per kWh for the power surplus injected to the grid. Why only 2 MW was installed to date?

Net metering was launched several years ago and, although it has now this good tariff, there is a very low level of awareness from Iranian homeowners, and what is missing here is action to provide consumers with information on the advantages of residential PV solutions. However, the government is planning to install PV and renewable energy systems on its buildings under the scheme, and these new installations are expected to cover 20% of their power demand. Furthermore, Iran’s large cities’ municipalities such as Tehran, Mashhad, Isfahan and Tabriz have unveiled plans to develop solar and renewable energy in urban spaces and parks.

What is Iran Renewable Energy Association doing to increase awareness and to promote investments in solar in Iran?

Our association is currently organizing events such as the renewable energy day, student festival in renewable energy, and training courses for school students. Furthermore, we are facilitating the presence of foreign investors and manufacturers by consultation, introducing the profitable economic projects in Iran, helping to find a domestic partner in Iran and the necessary permissions for all kind of renewable energy projects. Our next event is the 2nd Iran Renewable Energy Conference (Iran REC 2017) which will be held from Oct 31st to Nov 2nd, 2017 in Tehran. This conference is going to be supported by International Renewable Energy Agency (IRENA), key governmental stakeholders of renewable energy in Iran such as Power Ministry (SATBA), Organization for Investment Economic and Technical Assistance of Iran, and the Vice-Presidency for Science and Technology (Presidency of the Islamic Republic of Iran).