Iran, Germany Energize Ties
Amid widening business ties between Iran and European governments in the wake of Iran's nuclear deal with six world powers, the Iran-Germany Energy Committee held its first meeting in the Iranian capital to explore opportunities for investment by potential German financiers.
Hosted by the Iranian Ministry of Petroleum, the October 23-26 meeting was attended by senior Iranian and German officials.
At an opening statement, Iran's Deputy Minister of Petroleum for International Affairs and Commerce Amir-Hossein Zamani-Nia said the nuclear deal, dubbed the Joint Comprehensive Plan of Action (JCPOA), would "survive" despite US President Donald Trump's threat to terminate it.
He said there were "indications" from Washington that the US Congress would opt for "wisdom" to prevent the JCPOA from being terminated.
Zamani-Nia said the threat of termination of the JCPA had "passed".
"Iran-Germany relations go far back," he said, adding that Iranians held a positive view of "industrial cooperation" between the two countries.
"We think that the capacity of cooperation between the two countries" is much more than their current levels stands, said Zamani-Nia.
He put at $3 billion the volume of trade between the two countries, which he described as "insignificant".
"This level of trade is insignificant compared to Iran and Germany's potentials … One of the first messages of the Iran-Germany Energy Committee should be to facilitate banking relations," he added.
Zamani-Nia referred to reciprocal visits by Iranian and German officials' post-JCPOA, adding that more negotiations were needed to accelerate the pace of cooperation for which there is great potential.
Close Cooperation
German Ambassador to Iran Michael Klor-Berchtold said he hoped that the Iranian nation and government would benefit from the "dividends" of the JCPOA.
"This meeting today is another example of the close cooperation between the two countries," he said, adding: "It is one of the outcomes of the Joint German-Iranian Economic Commission which was held about one year ago for the first time in 15 years here in Tehran."
He referred to Germany's investment in "two solar plants" in the western city of Hamedan, adding: "These solar plants were the first substantial solar plants being installed in Iran. This German-Iranian project underlines our common goal of a secure, affordable and sustainable energy supply for our future economic development."
"In order to achieve our common goals we need to work together on the development of sustainable energy, modernization of conventional energy installations, energy efficiency, and the planning of energy transition," said Klor-Berchtold.
The top diplomat said Iran is among the countries with the largest hydrocarbon resources in the world.
"Anyhow, the Iranian government has clearly committed itself to promoting renewable energy," he added.
"In my view, this is the right path to follow. The international energy transition is in full swing. More is being invested worldwide in developing renewable energies than in conventional energy sources," he said.
Renewables on Agenda
Ursula Borak, the deputy director general for Germany's Ministry for Economic Affairs and Energy, also told the meeting that Iran-Germany's energy collaborations are centered on renewables and enhancing power efficiency.
In July, a delegation of seven German companies operating in the renewables sector signed a memorandum of understanding to develop solar farms in North Khorasan Province.
Iran's total renewable energy capacity, including solar and wind, amounts to less than 500 megawatts compared to some 62,000 MW of thermal and 12,000 MW of hydroelectric capacity, as well as 1,000 MW of nuclear power.
Officials say Iran needs to expand its power generating capacity by 5,000 MW annually, or 20,000 MW in four years, to meet the rising demand at home and expand its footprint in the regional energy market. In roughly the same period, installed power generating capacity of renewables, including wind and solar, is envisioned to increase by 5,000 MW.
She said that Germany was ready to share its experience with Iranian companies in the development of renewable energies.
Borak said Iran's policies were instrumental in attracting foreign investment, noting that German companies owned advanced technology in power generation and transmission.
Hamid-Reza Tashayoei, head of the Iranian Energy Ministry's Center for Promotion of Exports and Water and Power Industry Support, said plans were under way for raising the current capacity of renewable power plants to 5,000 MW by 2025.
He pointed to longtime good relations between Iran and Germany, saying the Energy Committee meeting would help deepen relations between the two countries and help them exchange experience.
Tashayoei said the Iranian Ministry of Energy has been benefiting from the German experience in renewable energies.
He said that Iran enjoyed good conditions in terms of sunlight to generate electricity across the country.
Tashayoei expressed hope for the continuation of such meetings for the two countries to develop energy cooperation.
Iran is the most advanced in its development of renewable energy, mostly due to its past investments in hydropower schemes. Lately, however, it has been taking big strides in terms of wind and solar power, with a slew of new projects announced over the past few months.
To date, the largest was unveiled in October 17 when Norway’s Saga Energy signed a €2.5bn ($2.9bn) deal with the state-owned Amin Energy Developers to build a solar power plant with generating capacity of up to 2GW over the next five years.
There are a few reasons behind the rush of investment, including favorable investment terms on offer from the Iranian government. The Energy Ministry typically signs deals guaranteeing to purchase the output of renewable energy plants for 20 years, via the Renewable Energy Organization of Iran (SUNA). The plants are also tax exempt for between five and 13 years.