Baku, Azerbaijan, May 6
By Elnur Baghishov – Trend:
Iran needs about $5 billion of investments for building a new 5,000 megawatt power plant, Payam Bagheri, deputy head of Iran Electrical Industry Syndicate (IEIS), told the Young Journalists Club (YJC), Trend reports.
According to Bagheri, investments in Iran's electric power industry have dropped, and electricity consumption in Iran increases by 5-7 percent annually.
"The government's lack of financial resources has placed the Iranian Energy Ministry in a tough situation. The Energy Ministry’s debt and electricity shortages in summer should be connected to this," he said.
Commenting on the price of energy carriers in Iran, Bagheri added that, because of the proposed sales price being less than the final price, investments decline, while consumption keeps increasing. Unless this issue is dealt with, other problems will remain unresolved.
"According to statistics from international organizations, Iran ranks first globally in the payment of subsidies for energy carriers such as oil, gas and electricity. This shows the loss of financial resources," he said.
Bagheri said that, according to Iran’s 5th Development Program, the prices of energy carriers had to have been realized. However, despite the start of the 6th Development Program, this project has still not been implemented.
Failing to properly implement the plan on the efficient use of subsidies, as well as the payment of funds in cash, caused negative results, Bagheri said.
"The payment of subsidies in such a way is tantamount to destroying the country’s resources. By abolishing subsidies, these funds should be spent on health, education and other fields in Iran," he said.
Under the plan for the efficient use of subsidies in Iran, 60 percent of subsidies have been canceled and are being paid to citizens in cash since 2011. However, the subsidy allocated to energy carriers has not been abolished. Currently, 1 liter of petrol is worth 10,000 rials ($0.23 per the official exchange rate, $0.06 in the black market).