The deal was signed in Tehran on Wednesday by First Deputy Prime Minister of Azerbaijan Shahin Mustafayev and Energy Minister Reza Ardakanian, ISNA reported. A preliminary agreement to build the power station in Azerbaijan was reached in 2019.
“Construction of the 280-megawatt power station will start soon,” Mustafayev said, but did not provide details.
Khoda-Afarin is an earth-fill embankment dam, with the capacity to hold 1.6 billion cubic meters of water on the Aras River. It is located 8km west of Khomarlu, (capital of Khoda-Afarin County) in Iran's East Azarbaijan Province and 14km southwest of Soltanli in Jabrayil District in the neighboring republic.
The senior Azeri official said interaction between the two states is growing in all areas, especially energy, and expressed the hope that incomplete plans in and around Aras River would become operational soon.
“Azerbaijan’s borders with Iran are borders of friendship and evelopment,” he stressed, and said that timely implementation of joint agreements, such as the Rasht-Astara railroad and Khoda-Afarin power plant construction projects, would benefit both peoples.
Ardakanian said Iran-Azeri collaboration has improved in recent years, especially in the power sector. “In the past four years, presidents of the two countries held 12 meetings that produced important cooperation documents.”
Power Grid
Ardakanian said Iran is trying to synchronize its power grid with Azerbaijan. Although an electricity exchange contract already exists “we are looking at the bigger picture by linking the two electricity networks.” Iran has said it is planning to connect its power grid to Russia through the Republic of Azerbaijan.
Electricity experts from Iran, Russia and Azerbaijan met in Moscow in 2019 to discuss technicalities of “creating an energy corridor” to export Russian electricity to Azerbaijan and Iran. In a memorandum of understanding signed in 2015, the three sides agreed to synchronize their power grids by 2021 and pave the way for electricity trade between Tehran and Moscow.
In 2018 Azerbaijan, Russia and Iran created a working group to chart ways to synchronize their energy infrastructure. The network will connect the three power grids and help curb outages in summer.
Iran and Azerbaijan can exchange at least 700 megawatts a year.
Sharing Resources
Referring to a recent deal on shared water resources of the Aras River, the energy minister said the two sides use the river's resources based on mutual interest, and the new agreement would pave the way for sustainable exploitation of the resources.
East Azarbaijan Province's share of water from Aras River is 282 million cubic meters a year, and when the first phase of a plan to transfer water from the river in the northwest to Tabriz is inaugurated, Iran’s share will rise by 102 mcm/y.
The project to supply water from Aras to East Azarbaijan that has so far cost $200 million, was launched in 2010 and is almost 80% complete. It entails building two dams namely Golfaraj and Gardian on Aras in Jolfa County in the province, laying 50 kilometers of high-pressure pipelines plus installing six pumping stations.
Iran is self-sufficient in power plant construction and has signed energy contracts with neighboring states. The country's dam building capacity has significantly improved in the past three decades. More than 200 contractors, 70 consulting firms and 30 associated companies along with dozens of hydroelectric equipment manufacturing companies are involved in the key sector.
Iran ranks third in dam building internationally, after China and Japan, according to the American Enterprise Institute.
Thirty Iranian firms have 88 water and electricity projects worth $4.3 billion with South America, namely Cuba, Bolivia and Venezuela.