A renewable energy company based in Abu Dhabi has pledged to finance the construction of large solar power plants in Armenia that would ease the country’s dependence natural gas and nuclear power.

Abu Dhabi Future Energy Company, also known as Masdar, signed a “joint development agreement” to that effect with the Armenian National Interests Fund (ANIF) in the capital of the United Arab Emirates (UAE) at the weekend. Armenian President Armen Sarkissian and UAE’s Energy Minister Suhail Al Mazrouei attended the signing ceremony.

In a joint statement, Masdar and ANIF said the deal envisages the launch of solar energy projects in Armenia with a total capacity of 400 megawatts, which would nearly match the design capacity of the Metsamor nuclear plant generating more than one-third of the South Caucasus nation’s electricity. They said this will require between $300 million and $320 million in investments, the bulk of which will presumably be made by Masdar.

“The first project planned under the [Joint Development Agreement] is a 200-megawatt utility-scale solar photovoltaic (PV) plant in the west of Armenia,” added the statement. It gave no dates for the start of its construction.

The statement quoted Masdar’s chief executive, Mohamed Jameel Al Ramahi, as noting Armenia’s “considerable untapped potential for both solar and wind power.”

“Armenia is a fast-growing economy with an increasingly open and supportive environment for inward investment,” said Al Ramahi. “That is an important reason why we have been able to move forward in our partnership with ANIF so swiftly.”

“I am happy to report that we have sent a highly competitive written proposal to the government of Armenia which outlines the details of the 400-megawatt of solar PV that we are jointly proposing,” David Papazian, the head of ANIF, said for his part.

Papazian, who runs a state agency tasked with attracting foreign investment in Armenia, did not say whether the deal commits the government to co-financing the projects.

Masdar has already invested at least $8.5 billion in renewable energy projects in the UAE and abroad. Al Ramahi told Reuters news agency early this year that the state-owned company plans to double its renewables energy capacity in five years with new projects in Asia and the Americas.

Both the current and former Armenian governments have pledged to significantly increase the presently modest share of renewables in domestic electricity production.

The first Armenian solar power plant with a 0.5-megawatt capacity went on stream in September 2017. Six more such facilities were connected to the national power grid by November 2018. Armenian private firms began building several more solar plants in the following months. One of them was inaugurated near the central town of Hrazdan on November 13.

A much larger, 55-megawatt plant is due to be built by a Spanish renewable energy firm in northeastern Gegharkunik province by the end of 2020. The $50 million project is mostly financed from a World Bank grant allocated to Armenia in 2015.

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