New market armenia energy storage project

How has Armenia restructured its energy sector?

Prompted by a severe electricity supply crisis in the mid-1990s, Armenia has revamped its energy sector over the past 20 years. Parts of the sector have been privatised, some companies have been restructured, most households now have access to gas, and cost-reflective tariffs have been introduced.

Will Armenia's energy sector transition through 2040?

The Armenian government approved the Energy Sector Development Strategic Programme (hereinafter “Energy Strategy”) in January 2021, setting the path for the sector’s transition through 2040. The publication and approval of this strategic document are welcomed and should form a useful basis for Armenia’s future energy legislation.

Is Armenia moving from a single-buyer model to a competitive power market?

Armenia is moving from a regulated, single-buyer model to a competitive power market, with a launch date set for February 2022. The careful preparation of this work over many years is to be commended. As part of the first stage of market reforms, the government plans to improve protection mechanisms for vulnerable customers.

Why does Armenia need a single energy supplier?

Armenia relies on imports of natural gas and oil for most of its energy needs, which exposes it to supply risks and dependence on a single supplier. As the government considers energy security and the development of indigenous sources to be of prime importance for the energy sector, renewables and efficiency measures are key areas.

How does Armenia import natural gas?

Natural gas is imported from Russia via pipeline through Georgia, but also from Iran through a barter agreement under which it exports electricity in exchange. Armenia also trades electricity with Georgia, though volumes are low since the countries’ networks are not synchronised.

How does Armenia produce electricity?

However, all of its thermal generation relies on gas, around 85% of which is imported from Russia. Furthermore, Armenia imports all of its nuclear fuel from Russia. Armenia therefore effectively relies on fuel imports from one country to produce nearly 70% of its electricity, raising concerns about the diversity of supply.