Energy efficiency programs in Armenia: Supporting residents, benefiting nation
Energy efficiency programs in Armenia
Energy efficiency is the optimal use of energy to achieve maximum results. People often confuse it with energy conservation. The difference lies in the approach: in one case, individuals save energy to reduce costs, while in the other, modern technological solutions are used for more efficient energy consumption.
As the economies of many countries rely on energy imports and their fluctuating prices, science offers technological solutions for efficient energy consumption and management. Systems like “smart homes,” energy-efficient lighting, solar panels, and other technologies have long been implemented, significantly reducing energy usage.
This process continues to evolve daily. Digital energy management systems are being introduced, enabling real-time monitoring of electricity consumption intensity in specific areas. “Passive houses,” which require no traditional heating or cooling systems, are becoming increasingly popular.
In Armenia, energy efficiency is a relatively new field. JAMnews assessed what assistance state, private, and international organizations offer to help residents improve the energy efficiency of their homes.
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“No need to heat all day anymore”
When buying new apartments, residents of Armenia have recently started paying attention to the energy efficiency rating of the building. Those who cannot afford to buy energy-efficient housing often try to incorporate this option themselves, usually by applying for loans.
These loans, provided to improve the energy efficiency of homes, are often subsidized by the state or supported by other programs. These include initiatives like “Warm Hearth,” “My Roof,” and the UNDP and Green Climate Fund’s “Reducing Investment Risks in Energy Efficient Building Modernization.”
This year, Kim Ananyan applied for a loan to increase the energy efficiency of his two-room apartment. He said the apartment needed renovation, but additional funds were required.
On his son’s advice, he approached a bank to take advantage of a state-subsidized loan with a low interest rate for apartment renovations.
“You could say I borrowed money from the bank almost interest-free. The conditions were as follows: replace windows, install a heating system, add insulation to the walls, and replace light bulbs. Even if the bank hadn’t required these, it would have been unreasonable to ignore these energy-saving measures.
The exterior walls of our apartment were very thin—it’s a Soviet-era building. So, we added internal insulation, even though it reduced the living space. But now there’s no need to heat the apartment all day. We turn on the heater for just a few hours in the evening, and the apartment stays warm,” Kim explained.
He also encouraged his neighbors to take advantage of the state-supported program:
“The requirements are strict but fair and necessary—they’re in your own interest. We considered other renovation loans and calculated the interest for a five-year repayment period. It turned out that just the interest alone would cost 40,000–50,000 drams [about $100–125] per month. We wouldn’t have been able to save enough for the renovation. The loan was truly a great opportunity.”
According to Kim’s calculations, even if he saves 200,000 drams [about $500] per year on electricity, it’s a win:
“When buying apartments, people now pay attention to what the owner has done to save energy. For instance, they look at how many layers of glass the windows have, what brand of heating boiler is installed, and so on. I consider this renovation an investment as well.”
How to make your home energy-efficient
To finance renovations aimed at improving home energy efficiency, residents can apply for a loan under the state program aptly named “Energy-Efficient Renovation of Apartments and Individual Residential Homes.”
Since 2022, the program has subsidized loan interest rates depending on the applicant’s place of residence. Subsidies are set at 14% for those living in border and highland settlements, 12% for non-border rural areas, 11% for non-border urban areas, and 9% for Yerevan.
“The program initially anticipated between 400 and 2,000 beneficiaries. However, as of October, the number has already reached 17,000,” the Energy Management Department of the Ministry of Territorial Administration and Infrastructure reported.
In 2023, most loan applications came from the Ararat (1,299 people) and Kotayk (1,298) regions, followed by Armavir (845).
“The program also allows for the purchase and installation of solar water heating systems and photovoltaic systems. These measures are also considered to meet the energy efficiency criteria and account for a significant portion of the program,” the department stated.
Under the UNDP and Green Climate Fund program “Reducing Investment Risks in Energy-Efficient Building Modernization,” up to 25% of thermal modernization costs for an entire residential building can be co-financed. The remaining 75% must be secured by residents from other sources, which can include state subsidies, private company assistance, or personal funds.
The primary measures for ensuring home energy efficiency are well-known to many. However, both government and private programs run informational campaigns to raise awareness. These efforts aim to share as much information as possible with anyone renovating an apartment or building a house.
Energy efficiency benefits extend beyond individual residents. Reducing energy consumption is crucial for the environment and addressing the challenges of global warming.
Lower energy consumption leads to reduced greenhouse gas emissions. Residential buildings and transport account for over 60% of energy consumption and greenhouse gas emissions.
In December 2023, the Armenian government approved a long-term low-emission development strategy. According to this document, greenhouse gas emissions per capita are to be reduced to 2.07 tons of CO2 equivalent by 2050. In this context, energy efficiency measures are not only vital for citizens but also for the state. This is why the government serves as both the primary beneficiary and donor for these programs.
