By Alexander Pracht
The Armenian government established a new company Thursday and tasked it with drafting a roadmap to construct a replacement for the country’s aging, Soviet-era nuclear power plant by 2040.
The state-owned company will have an annual budget of just more than $2 million and will work under the infrastructure ministry, Prime Minister Nikol Pashinyan’s cabinet reported. The company is expected to conduct a comparative study of all available technologies and present the most optimal solution to the government within two years. Should the government give its greenlight, the company will then be put in charge of all the paperwork needed to build a new nuclear plant.
What’s the background?
Metsamor, Armenia’s sole nuclear power plant, was initially due to be shut down in 2017, but its lifespan has been repeatedly extended. The plant’s operations are fully dependent on Russia’s state-run atomic energy company, Rosatom, crucially including nuclear fuel supplies. Last December, the Armenian government inked a $65 million modernization and renovation deal with Rosastom to keep the Soviet-era facility running until 2036. After that, it will have to be decommissioned.
Metsamor currently meets some 30% of Armenia’s domestic energy needs and even allows the country to export some electricity to Georgia and Iran. Despite apparently politically motivated pressure from Azerbaijan and Turkey to shut down the reactor, the facility continues to comply with safety standards mandated by the United Nations’ atomic energy agency.
Metsamor’s first unit was launched in 1976, with a second reactor added in 1980. While the facility remained intact after Armenia’s devastating 1988 earthquake, the Soviet government decided to shut it down shortly afterward. Not willing to take any risks running a nuclear reactor in an active seismic zone, Moscow yielded to growing public distrust toward nuclear power, largely fuelled by the 1986 Chernobyl disaster in Ukraine.
Metsamor’s shutdown played a key role in Armenia’s early 1990s energy crisis, which also saw Azerbaijan cut off natural gas supplies to the country during the first Nagorno-Karabakh war. With no gas to feed its thermal power plants and Metsamor shut down, Armenia went through a severe humanitarian crisis that forced countless Armenians to leave the country during the first years of independence.
What are Armenia’s options?
Armenia has discussed plans to build a new nuclear power plant for years. Deputy Infrastructure Minister Hakob Vardanyan told Deutsche Welle last month that the government was considering options from China, Russia, South Korea, and the United States.
The biggest concern is the replacement’s capacity. Even though Armenia’s current energy demand stands at around 1,200 MW, most contractors have reportedly offered reactors with capacities as high as about 1,000 MW. As Armenia needs to keep its energy sources diversified, the country does not require that much power from a new nuclear facility.
To that end, Pashinyan announced earlier in February that Yerevan might consider constructing a U.S.-designed modular plant, which would have a power generating capacity of up to just 300 MW. The government also believes that option may be safer than a regular nuclear reactor.
Meanwhile, Rosatom First Deputy General Director Kirill Komarov has suggested that Russia could build a nuclear reactor of any capacity between 50 and 1000 MW, using separate units of 50 MW each.
What other facilities generate power in Armenia?
Aside from Metsamor, Russia also controls most of Armenia’s other energy resources and power distribution networks, one way or another.
A Soviet-era complex of seven hydropower plants known as the Sevan-Hrazdan Cascade is owned by the Russian-based Tashir Group, a conglomerate under the control of Samvel Karapetyan, a Russian billionaire of Armenian origin. Despite the reportedly poor condition of those aging plants, they still generate about 10% of Armenia’s electricity.
Karapetyan’s Tashir Group also owns the Electric Networks of Armenia, the national power distribution company, as well as the Hrazdan thermal power plant, a facility with a capacity of some 400 MW, just as much as Metsamor. The Hrazdan plant runs on natural gas supplied to Armenia by Russia’s state-run gas giant, Gazprom, which also owns Armenia’s gas distribution network, including a pipeline running to Iran.
The two notable exceptions are the Vorotan Cascade of hydropower plants in Armenia’s southernmost Syunik region, which ultimately belongs to the U.S.-based investment company KKR, and the state-owned Yerevan thermal power plant, launched in 2021.
Enjoying a monopoly on Armenia’s energy market, Russia would hardly be happy about Armenia’s choice of a Western contractor for a new nuclear power plant. Yerevan’s nuclear dilemma is political, not technical.
