Grid connection of the Gol Gohar power plant in southern Iran has boosted the country’s nominal installed generating capacity to 75,365 MW. Out of the total, gas-fired capacity currently accounts for just under 26,600 MW – yet more is to come as production of the South Pars gas field ramps up.
The Iranian energy minister Hamid Chitchian is working on implementing plans to increase the country’s gas-fired generating capacity and export electricity to neighbouring countries, such as Armenia.
The speed of South Pars development is deemed ‘crucial’ not only for Iran’s electrification plans but also for the country’s future oil and gas exports. Located offshore in the Persian Gulf, South Pars holds almost 40% of Iran's proved natural gas reserves.
The field’s oil layer is tapped by PEDCO in a first development phase, with an estimated plateau output of 35,000 b/d in 2017-18. Natural gas is favoured by the government in Teheran as the main fuel source for domestic power generation as gas liquids and oil are more valuable in the petrochemical industry and for export.
EIA analysts anticipate Iran’s non-crude liquids production to grow by 150,000 b/d by the end of 2016 and by an additional 100,000 b/d by the end of 2017, dependent on how speedily the 24 development phases of South Pars will progress.
Seeking to step up electricity exports
Selling electricity to neighbouring countries would be more lucrative for Iran than selling natural gas outright. Hence, the energy ministry is aiming to double power exports from currently 12 kWh – compared to imports of 4 billion kWh per year.
Upgrades of Iran’s ageing power plants are vital to reach the goal of boosting electricity exports. Over 3,000 MW of Iran’s installed fossil power generation capacity is deficient due to old age and would need to be retired and replaced in due course.
A Turkish developer recently offered to build much-needed new power plants. A $4.2 billion deal, struck in early June, between the Iranian energy ministry and Unit International of Turkey foresees the development of seven CCGTs with a combined capacity of over 6 GW. Construction of the first plant is due to start in the first quarter of 2017, and once completed the seven plants could cover up to 10% of Iran’s electricity needs.