Iran Gov't Divesting Stake in Thermal Power Plants

EghtesadOnline: Iran's state operator of thermal power plants is on pace to divest a spate of power stations to reduce the government's footprint in the key energy industry.

News ID: ۷۴۴۸۳۴

04 February 2018

"Thermal Power Plants Holding Company aims to sell stakes in an undisclosed number of power plants with a combined installed production capacity of 11,570 megawatts to the private sector," Mohsen Tarztalab, TPPHC's managing director, was quoted as saying by IRNA on Saturday.

"Four power plants have been listed by Iranian Privatization Organization for sale and the outcome of their tenders will be publicized on Feb. 13," he added.

Tarztalab noted that there is no restriction on foreign investors taking over Iranian power stations.

The divestment program will account for nearly 15% of Iran's total installed power generating capacity that stands at 77,000 MW.

THPCC oversees dozens of fossil fuel power plants with an installed capacity of over 62,000 MW that meet the bulk of Iran's electricity demand.

The four power stations planned for sale are located in the northern Gilan Province, Semnan Province east of Tehran and the East Azarbaijan Province.

According to IRNA, over 60% of Iran's power output capacity are run by the private sector, a figure stipulated to reach 80% under the country's privatization law.

The efforts are aimed at breathing new life into an aging power industry that is overshadowed by state control over most of the production and supply chain, a lack of investment and ballooning debts to power plant operators.

TPPHC is in charge of developing 7,000 MW of gas-powered units in Jahrom, Sabalan, Kashan, Urmia, Chabahar and Asalouyeh combined cycle power plants as well as completing Parand Power Plant south of Tehran.

Tarztalab said work is underway on Maku Power Plant Project in the eponymous trade zone in West Azarbaijan Province as well as Qeshm 2 and Bandar Abbas power plants in Hormozgan Province and Lamerd in Fars Province.

Iran plans to bring on stream 5,000 MW of power generating capacity annually through 2022, the last year of its Sixth Five-Year Economic Development Plan.

Despite heavy reliance on hydrocarbons, the country is taking measures to raise the share of renewables by 1,000 MW per year from below 400 MW at present.

Iran needs the new capacity to shore up domestic power supply and increase electricity exchange with neighbors as part of a scheme to establish a regional power network. Electricity demand reached an all-time peak of 55,400 megawatts last summer, according to Financial Tribune.

It is reported that steps have been taken to gradually convert the conventional gas-powered plants into efficient combined-cycle units. Close to 12,000 MW are produced from hydroelectric plants and 1,000 MW from the sole nuclear power plant in Bushehr in the south.