Thursday, June 11 2020 12:56

ArmInfo.  German KfW Bank will  additionally provide Armenia with a grant of 550 thousand euros to  conduct research on the project for the construction of a  high-voltage power transmission line Armenia-Georgia. At the June 11  sitting, the Government of the Republic of Armenia approved a  corresponding agreement with the bank for signing.

As noted in the certificate - justification of the draft decision,  the program was suspended in 2017 in order to optimize costs and  apply new technical solutions. However, following a meeting held at  the RA Prime Minister on October 30, 2019, a decision was made to  resume the program on already approved loan and grant agreements  based on the technical solutions provided. The program will continue  on the basis of tenders already held and envisaged tenders on three  new lots. Given that the new tender procedures were not previously  included in the scope of work carried out before the project was  suspended by the consultant in the person of Fichtner, it became  necessary to activate these new conditions. In this regard, the  consultant will be paid the amount accumulated before the suspension  of the contract for the services rendered in the amount of 350  thousand euros, and 340 thousand euros for the organization of new  tender procedures. In this regard, in addition to 820 thousand euros  provided by the bank, according to the grant agreement of May 24,  2013, KfW will provide an additional 550 thousand euros. The program  is implemented by the state-owned CJSC High-Voltage Electric  Networks.

To recall, on October 30, 2019 RA Prime Minister Nikol Pashinyan held  a meeting at which the process of implementing the Caucasian  Transmission Network program, involving the construction of a power  line and a Armenia-Georgia substation, was  discussed.  

According to the press service of the RA Government,  during the  meeting, the planned work on the construction of the  Ddmashen  substation with a capacity of 400/220/10 kV, the 400/500 kV  overhead  power line, the Ayrum converting station, current problems and  proposed technical solutions were discussed, as well as the  ability  to synchronize the work of regional power systems. Issues  related to  the construction of Armenia-Iran and Armenia-Georgia  transmission  lines and the development of regional energy cooperation were also  touched upon.

The Prime Minister stressed the importance of the program in the   context of ensuring an effective energy connection with Georgia,   developing the energy infrastructure of Armenia, regional integration   of energy systems, and instructed those in charge to continue the   implementation of the works mentioned in the program.  To note,  however, that the construction project of the North-South  energy  corridor, designed to unite the electric power systems of  Iran,  Armenia, Georgia and Russia, has faced a number of problems.  The  construction program of 400-kilovolt transmission lines  Iran-Armenia  and Armenia-Georgia was to be implemented before the end  of 2019.  And if the construction of the Iran-Armenia power  transmission lines  is only 25% completed, then the parties have not  yet begun  construction of a similar power transmission lines with  Georgia. On  March 15 last year, the technical commission on improving  the  reliability and efficiency of the electric power system of  Armenia  approved the technical task for the construction of power  lines  Armenia-Georgia. The terms of reference was developed by the  German  KfW bank, which finances the program, and FICHTNER, which won  the  tender for the project consultant. According to the technical task,  the project is divided into several stages. At the first stage,  it  was planned to modernize an electric substation with a voltage of   220 kW, to build a new substation with a voltage of 400 kW, and also   to build a new overhead power line to the Georgian border. At the   second stage it was planned to build an electrical substation with a  voltage of 500 kW. However, in order to improve the efficiency of the   program, it was planned to use the existing electrical substations,   the modernization of which is less expensive than building new ones.   At the same time, solar power stations will be erected on the   existing premises, on which it was planned to build an electrical   substation, the construction costs of which will be reduced through   the use of existing infrastructures. As a result, the cost of the   entire program of construction of power lines Armenia-Georgia will be   reduced by 30%. At the meeting of the  commission it was noted that  the first stage of the project should be  completed no later than the  third Iran-Armenia transmission line  currently under construction.  In general, the Iran-Armenia power transmission line construction  program should be completed in  parallel with the second power unit  of the Yerevan TPP under  construction.  But following the meeting,  the Prime Minister decided to implement the program on the basis of  previously approved agreements.

As ArmInfo previously reported, the sources of funding  for the  first two stages are already known.  According to FICHTNER, the  preliminary cost of the Armenia-Georgia power transmission  program  is EUR 326.9 million, 10% of which should be part of Georgia's  contribution. The first two phases of the program are  estimated at  188.2 million euros. To this end, in 2014-2015, three  loan  agreements were signed. In particular, the German bank KfW allocated  in the form of a loan 168 million euros, another 10 million  euros  provided by the European Investment Bank. It is expected to receive  another 10 million euros in the form of a grant from the  European  Commission.  As for the Iran-Armenia high-voltage power  transmission  line, the project is funded by the Iranian side, the  total cost of  the program is $ 107 million.  However, given the new sanctions  imposed by the United States against Iran, there is a  concern about  a reduction in the volume of this investment program.