Nationalization of electricity networks and investor confidence

PanoramaamTV · 9 minutes

“Our electricity system has quite big problems, and one of the problems is that solar electricity currently provides 14 percent of the total production. The system that came to us as a legacy from the Soviet Union is not ready and was not designed for solar electricity. About 5 percent of all our cars are electric, while, say, five years ago, there were almost none, and there is a tendency that in five years, 20-30-40 percent of all the cars on our streets will be electric, and at the moment many are trying to organize heating with electricity. These two circumstances may also lead to our electricity demand increasing sharply by two times. Hydroelectric power plants currently produce about 25 percent of our electricity, but they are decreasing year by year, and, say, in a few years, solar electricity may produce more than the electricity produced by hydropower plants.”

“It is not that it was nationalized at once, and these problems were solved, because these problems require a large volume of quite large-scale investments. Now, how are we going to attract some businessman in the future, if he comes to say, excuse me, brother, if I am investing billions of dollars now to modernize all this, who will give me a guarantee that not tomorrow, not the next day, some law will not be changed, and everything will be nationalized again. The same goes for water and other large investment fields, where a certain loss of confidence may occur, and for investors, trust is important first of all. Market liberalization was carried out slowly, surgically, and it gave certain benefits. For example, in 24 there were large-scale disconnections in Yerevan, this year they were reduced quite sharply. And this abrupt step creates new problems.”