The International Finance Corporation (IFC), the European Bank for Reconstruction and Development (EBRD), and the European Union (EU) will support the development of the 55 MW Masrik solar plant, the first utility-scale solar power plant in Armenia. The solar plant will be located in the Gegharkunik Province of the country and will be developed by Fotowatio Renewable Ventures (FRV), part of Abdul Latif Jameel Energy. The company will receive a USD 35.4 million debt financing package consisting of two USD 17.7 million long-term loans, one each from IFC and the EBRD. The project will also receive a Euro 3 million investment grant from the EU, mobilized by the EBRD. The IFC financing package includes a USD 8.9 million loan from IFC’s own account and a USD 8.9 million loan from the Finland-IFC Blended Finance for Climate Program. The solar plant is expected to generate more than 128 GWh of electricity annually. The electricity generated will be sold under a power purchase agreement to Electricity Networks, an Armenian utility at a competitive tariff of 4.19 cents per kWh.

Currently, nearly 70 per cent of Armenia’s electricity generation depends on imported fossil fuels. As the country’s demand for electricity grows, renewables are expected to provide a sustainable and low-cost alternative source of energy.

The World Bank has helped the Armenian government prepare the project and provided transaction advisory support as well. In the past, the World Bank has also worked with the Armenian government to implement various reforms to deliver more efficient power supply to consumers.