Renewable Energies Investment Opportunities in Iran

A Brilliant Opportunity for Investing in Renewable Energies

• More than 2900 annual average sunny hours in Iran

• 300 sunny days in a year in more than 2/3 of Iran

• Average 4.5-5.5 kWh/m2 per day

Solar power plant

+ Within the framework of the Iran Fifth Five-Year Development Plan:

• Short-term target: 5000 MW of installed capacity from renewable power plants

• Long-term target: increase the nominal capacity of all power plants from 74 GW to over 120 GW by the end of 2025, in which a portion is determined to be derived from renewable resources.

+ oEstablishing a specific credit line to receive the amount of 50 Rials (0.119 cents) per kWh of subscriber’s power consumption as a fiscal year in 2017,   amounting to about 1,100 billion USD in this way, will be saved for the development of renewable energy sources.

+ If domestic and foreign investors use Iranian technologies and   equipment to produce electricity, the Ministry of Energy will allocate renewable energy equipment and technologies to a maximum of 30% in addition to the base rate, and will pay more.

+ Owners of a renewable plant may use exemptions or reductions in customs duties if they import parts and equipment from the installation of a power   plant from abroad.

Foreign Investment Promotion and Protection Act (FIPPA)

 The main Iranian foreign investment law is the Foreign Investment Promotion and Protection Act (FIPPA). The FIPPA grants foreign investors the same rights, protections and facilities available to domestic investors. This includes permission for investment in all fields where private sector activity is allowed and permission to hold up to 100% of shares in Iranian legal entities. Protection against expropriation and nationalization is guaranteed except where public interest reasons apply, in which case the expropriation should follow a non-discriminatory procedure and the investor should obtain compensation based on the real value of the investment. Moreover, the FIPPA includes provisions to ensure free transfer of foreign capital and profits of foreign investment abroad. Foreign investors may claim through the Act to convert Iranian Rial and to acquire necessary foreign currency for such transfer. Furthermore, residence and work permits for foreign personnel are facilitated under the FIPPA. The FIPPA defines a foreign investor as any non-Iranian or Iranian individual or legal entity utilizing capital of foreign origin, provided it has obtained the relevant investment license. Foreign capital is defined as being all types of capital, including cash or in kind that has been imported into Iran. To obtain an investment license, an application has to be made to the Organization for Investment, Economic and Technical Assistance of Iran (OIETAI).

1. Power Purchase Agreements of power plants subject to this announcement are extended for a 20 year period with the specified tariffs during years of contract; the tariffs will be adjusted in accordance with coefficient under article 3 of Economic Council Directive.

 – Note1.Tariffs mentioned for all power plants subject to this announcement except wind farms, will be multiplied by 0.7 after adjustment of article 3 of Economic Council Directive starting from the first day of the second 10 years till the end of the contract.

– Note2.Tariffs for the wind farms with the capacity factor of 40% and above in the first 10 years, will be multiplied by 0.4 after adjustment of article 3 of Economic Council Directive starting from the first day of the second 10 years till the end of the contract, power plants with capacity factor of 20% will be multiplied by 1 and for the range between 20% and 40% in a proper coefficient.

Read More

• ADJUSTMENT INDEX COEFFICIENT        more

• READINESS COEFFICIENT           more

• LOCAL PRODUCTS & SERVICES INCENTIVE COEFFICIENT         more