ArmInfo. A presentation of the Market Liberalization and Electricity Trade (MLET) Program took place in Yerevan, prepared jointly with specialists involved in this work from the United States Agency for International Development (USAID), which previously allocated a grant to Armenia in the amount of $ 8.5 million.
At the presentation, which was attended by about a hundred energy specialists representing various power generating companies of the country, foreign experts acquainted the audience with the specifics of reforming the electricity market in Armenia, with the specifics of the first transitional stage, the beginning of which was determined from February this year.
As Deputy Minister of Territorial Administration and Infrastructures in charge of the energy sector Hakob Vardanyan said in an interview with ArmInfo correspondent, a free electricity market can push the process of attracting investments in the generation sector, licenses for which will be liberalized without purchase guarantees. This will create a more competitive and open market. He stressed that over the past 2.5 years, the government has studied the experience and practices of many countries of the world and created a model inherent in the Armenian specifics. He noted that liberalization will not in any way affect the investment plans of the Armenian electricity distribution networks, which have begun their serious modernization, since it does not imply a change in the margin. The model of interaction between the producer and the buyer of electricity will change alone and will not affect the interests of the Electric Networks of Armenia company, which has embarked on a modernization investment program for a total of $ 720 million.
As it was said at the presentation, electricity should be viewed as a commodity through the prism of supply and demand, including taking into account the seasonal factor. By liberalizing the market, consumers will be able to purchase this product not at an average price, but at a cost. And in these conditions, service companies will come into play, which will supply (sell) consumers with electricity. The distribution function remains as a natural monopoly with its own tariff and margin. The supply function will gradually diversify among guaranteed service companies.
As the Deputy Minister noted, as for the liberalization of the electricity export market, there are numerous problems that need to be settled. In particular, if Georgia supplies electricity, then Armenia should turn off the electricity supply on the "island" of its territory - in Tavush or Lori. There is no possibility to work in parallel mode, which creates certain obstacles. But this does not mean that this work is impossible, Armenia works with Georgia in these regimes, and the process continues once or twice a year. The parallel mode can be activated in 2023-2024, when the construction of the Iran-Armenia and Armenia-Georgia power lines is completed.
