The new power plant is projected to have a generation capacity of about 1,060 megawatts (MW) and is scheduled to be ready for operations by 2017. The reactor's capacity will be more than double that of Armenia's current reactor, which accounts for 40% of the country's electricity supply.
Armenian ministers have approved the overall design and the primary technical features of the AES-92. Energy and Natural Resources Minister Armen Movsisian has been instructed to make the necessary preparations to sign supply contracts with Russian nuclear power companies.
In the opinion of Vahram Petrosian, director of a research institute that specializes in atomic energy, the choice of reactor is a sound one, although he believes that some of the auxiliary systems should be imported from the United States, and device operators should be brought in from a country such as France.
The new project is estimated to cost 3.4 billion euros (US$5 billion), nearly double the annual state budget of Armenia, making the financing of the project the biggest hurdle faced by the Armenian government. The initial authorized capital of the joint venture stands at 106,000 euros (US$156,000). The government still does not have a clear answer to the question of funds, although Movsisian has insisted that the government will successfully attract foreign investments in time to begin construction by early 2011.
In May, engineering company WorleyParsons Limited was retained by the Armenian government to manage the country's nuclear project. Based on a feasibility study conducted by the company, the government of Armenia took the decision to set up the joint venture. WorleyParsons will be managing the new project.
The 815-MW Metsamor nuclear power plant was built in the 1970s but was shut down in 1988 after a disastrous earthquake. The plant was reopened in 1995 with only one reactor. The resources of the plant will be exhausted by 2016. In 2007, Armenian authorities decided to shut down the plant after many years of pressure from the U.S. and the European Union, which claimed that the reactor was old and unsafe. The cost of shutting down the plant could reach an estimated 190 million euros (US$280 million).
Armenia's electricity is primarily generated by nuclear power, which contributes 43% of the country's power, and hydropower, accounting for 33%. The remaining 24% comes from thermal power. The country's thermal power plants account for 1,756 MW, while nine hydropower plants account for 1,038 MW of electricity.
The country is estimated to have the potential to generate 3,600 megawatt-hours per year of economically feasible hydropower. Plans are on to build two more hydropower plants with a combined capacity of 200 MW by 2020.
Armenia currently has one operating wind power plant, although the country is believed to have the potential to generate 4,900 MW from wind sources. The 90-MW Iran-Armenia windfarm is currently under construction and upon completion, will become the country's largest wind power plant. A 150-MW geothermal power plant is proposed to be constructed in Jermaghbyur.