A London-based firm is to become one of the largest players in Iran’s fledgling renewable energy market, under a deal that will see a 600MW solar project built in the Middle Eastern state.
Renewables investor and developer Quercus will today ink an agreement with Iran’s Ministry of Energy, making the company responsible for the construction, development and operation of the new plant.
Construction is expected to begin next year with one standalone 100MW lot set to be delivered every six months. Quercus chief executive Diego Biasi told Reuters the company would invest over €500m in the project, which represents the investors first foray outside the European market.
“Following significant interest from potential and existing investors, we are thrilled to be developing one of the world’s largest solar PV plants in Iran, presenting an unrivalled opportunity to tap into the huge potential in the country’s renewable energy market,” Biasi added in a statement. “As Iran opens for business, we are delighted to be taking a leading role in building the country’s renewable energy infrastructure at such an early stage of its development.”
He said the deal also represented a major boost to UK-Iranian trade. “Not only is this positive news for us, but also fantastic news for the UK, representing a major milestone for trade relations with Iran,” he said. “Iran is seeing unprecedented levels of investments since the lifting of international sanctions, and we are proud to be leading the UK’s push into this market.”
His comments were echoed by the UK Prime Minister’s Trade Envoy to Iran, Lord Lamont of Lerwick, who said the government “welcomes initiatives that not only support sustainable energy solutions for the future but also underline the importance of developing improved trading relations between the UK and Iran”.
Quercus said Iran provided a particularly attractive emerging solar market given its combination of 300 sunny days a year and government plans to cut carbon emissions by 260,000 tons a year.
The Energy Ministry has introduced guaranteed 20-year power purchase contracts that offer developers a fixed price for electricity produced from renewables. Moreover, the feed-in tariff rates paid through the scheme are increased by up to 30 per cent if local equipment is used in the projects and tax breaks are on offer if projects are located in under-developed areas.
HE Hamid Baeidinejad, Iran’s Ambassador to the UK, said the project “demonstrates Iran’s commitment to investing in and developing our renewable energy capacity”.
“Solar is a dominant global energy source in near future,” he added. “Iran, with its special geographic characteristics and position, will be a major hub of solar energy serving the region and beyond. This mega project is the foundation towards that goal.”