Iran, as one of the most important energy import-export countries in Middle East region, has the fourth largest oil reserve and the second largest supply of natural gas in the world. Iran’s energy mix is dominated by hydrocarbons. Renewable energy including hydropower accounts for about 6% of the overall electricity produced in the country where 90% of the fuel used in power plants is natural gas. The countries total energy consumption is continuously increasing at a rate that is forcing research into different resources to improve energy security and reduce the internal dependence on hydrocarbons.
Iran has set up a growth plan to boost green energies as a key sustainability factor. The Government plans to focus on green technologies to increase the nominal capacity of power plants from 74 GW to over 120 GW by the end of 2025. The Renewable Energy Organisation of Iran (SUNA) is looking to attract $60 billion of direct private investment by 2025 and the Government has called for new investments, which require technology and engineering to reach this capacity. The major benefit of using more diverse energy mix is reducing demand for fossil fuels will allow Iran to export more of its immense reserves of oil and natural gas to client states abroad. This will allow the Government to ease its costly subsidies while simultaneously meeting growing electrical demand through more sustainable and cost-effective renewable energy sources.
Recently, the UK investment fund is set to build one of the world’s largest solar power projects in the world in Iran by the end of the decade. The deal between Quercus, a green investment company in London, and Iran’s Ministry of Energy is worth over €500m (£440m) and will bring forward a giant 600MW solar project within the next three years by building a 100MW standalone installation every six months. The deal is one of the largest deals outside of the UK and is part of Iran’s drive to build 5GW of renewable energy by 2020.