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armenialiberty: Government Approves Russian Management Of Metsamor Plant

By Emil Danielyan

The Armenian government formally approved on Wednesday the transfer of the strategic nuclear power station at Metsamor under a five-year control of Russia’s state-run power monopoly in payment for its $40 million debts to Russian nuclear fuel suppliers.

Officials said Energy Minister Armen Movsisian and a top executive from RAO Unified Energy Systems (UES) will seal the agreement on Thursday. It will further reinforce Russia’s already substantial control over Armenia’s energy sector.

Under the deal finalized by the two governments earlier this year, UES repaid the debts in exchange for taking over Metsamor’s financial management and ownership of five hydro-electric plants near Yerevan. But a statement issued after a weekly cabinet meeting in Yerevan spoke of a broader “authorized management” to be given to the Russian electricity giant.

Still, an Armenian Energy Ministry spokeswoman insisted that the Russians will mainly be responsible for Metsamor’s finances. The official, Lusine Harutiunian, said UES will also be obliged to invest in safety measures agreed by the government and the International Atomic Energy Agency (IAEA).

“The Republic of Armenia will remain the owner of the nuclear plant and will bear ultimate responsibility for its safety and technical condition,” Harutiunian told RFE/RL. “The Russian side will largely be in charge of financial matters and the continuing safety measures.”

She also said that UES has pledged submit a “financial program” on Metsamor each year that will need to be approved by the Armenian government. The Soviet-built facility meets nearly 40 percent of Armenia’s energy needs.

UES has already been granted ownership of Armenia’s largest thermal power plant in the central town of Hrazdan under a separate Russian-Armenian equities-for-debt agreement signed late last year. Its formal handover was due to take place on September 5, but was postponed for unknown reasons.

UES’s tightening grip on the Armenian energy sector appears to be part of Russia’s broader effort to restore its economic presence in the ex-Soviet South Caucasus. Earlier this month, UES took over the power distribution network of the Georgian capital Tbilisi. The city, like the rest of Georgia, remains hamstrung by severe power shortages.

The Russians reportedly plan to make up for part of the deficit through power supplies from Armenia which overcame a similar energy crisis in the mid-1990s and now has an electricity surplus. Armenian government sources say UES has already applied for a special license to export its power to Georgia and possibly Turkey. They say no decision has been made on that yet.

The state remains the exclusive owner of Armenia’s high-voltage transmission lines that can transport electricity to neighboring countries.

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