YEREVAN. – The Armenian government proposed to the Public Services Regulatory Commission of Armenia to limit 30 MW, instead of the current 10 MW, as maximum capacity for small hydro power plants (HPP). In this way, the relatively average-capacity HPPs will likewise be defined as small HPPs. In addition, during a session on September 8, the “Strategic Development Program of the Hydro Energy Domain” was approved, whereby it is planned to produce - through small HPPs - 1 billion kW/hour annual electricity, instead of the current 400 million.

But this decision by the government has already received negative reaction from the environmentalists. According to EcoLur organization, in this way the water systems of Armenia’s rivers could be destroyed since there is no regulation as to which part of the river water can be used without damaging the ecosystem. 

Nonetheless, there is no doubt that the country’s water potential must be used effectively, and this is the case in terms national security, in the first place. 

According to expert analysis, from Armenia’s largest rivers the Debed - together with its Dzoraget creek - and the Araks are poorly used for energy purposes.  

But large-scale HPP construction, or planning, is underway at those 3 rivers. In addition, 74 small HPPs are under construction, and 101 small HPPs were producing energy as of March 1, 2011.

Also, the Armenian government prepared an interesting proposal toward developing the country’s hydro energy potential; but this proposal could change the price of electricity being supplied to consumers. The Public Services Regulatory Commission is recommended to increase, starting from 2016 and up to 6.5 US cents, the electricity supply tariff for HPPs with over 10-MW capacity. This is a fairly important decision considering the fact that the price of electricity supplied from large HPPs is fairly low.           

At present, the price of electricity supplied from small HPPs is 17.2 drams ($.05 dollars)/kW, without value added tax. But even if the change in tariff of small HPPs might not substantially reflect on the price of electricity supplied to the consumer, in the case of large HPPs a price change cannot be avoided.  

It is apparent that, first and foremost, the government is trying to stimulate construction of large or medium-size HPPs, as the priority was formerly given to up-to-10-MW-capacity HPPs. 

Samvel Avagyan