No takers for Zanjan IPP

26 September 2003
Iran's programme to develop independent power plants (IPPs) on a build-own-operate (BOO) basis has hit further difficulties after the failure of any companies to bid by the 22 September deadline for the first projects, two 500-MW power plants at Zanjan. State power company Tavanir is now starting an internal discussion on how to proceed with the programme. Developers say a serious revision of terms is necessary to make the projects more attractive (MEED 7:2:03).

Six groups of local and international companies were invited to bid for the two projects together, although Tavanir stipulated that different companies were to be awarded each plant. Four more 500-MW BOO plants were expected to be tendered shortly for Khoramabad, Mashad and Kashan.

'There is a real difficulty in Iran in moving from the idea to execution,' says a banker looking at the power privatisation programme. 'I find it difficult to see any movement on this programme for some time.'

The other parts of Iran's plans to introduce private power are also facing difficulties. Negotiations continue at Parehsar, the flagship build-operate-transfer (BOT) project being promoted by Iran Power Development Company (IPDC), following the withdrawal of a key member of the development team. And attempts to sell existing assets ran into difficulties after the submission of only two requests to prequalify to buy the 350-MW Khoy power plant in Azerbaijan.

However, there is some progress in other areas of the programme. An energy conversion agreement (ECA) was recently signed between IPDC and a consortium planning to develop the South Isfahan BOT IPP. The project is moving to a construction stage, although financial close is likely to take several more months.

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