Armenia sells energy grid to growing monopoly, Russian influence on the rise

The government of Armenia has made the decision to transfer the ‘High Voltage Electric Networks’ company to the concession management of the company ‘Tashir Capital’ for five years. ‘Tashir Capital’ belongs to a Russian entrepreneur of Armenian origin, Samvel Karapetyan, who last year acquired another electric company in Armenia, ‘Electric Networks of Armenia’.

These two companies work in direct communication with one another. The company ‘High Voltage Electric Networks’ performs the central function of receiving electric power from producers and distributes it to ‘Electric Networks of Armenia’, which in turn distributes energy to consumers across the country. The company ‘High Voltage Electric Networks’ has strategic importance for the country. Through this company runs all energy connections with Georgia and Iran – the only countries through which energy is delivered from and into Armenia.

T he Armenian government claims that this decision will raise the efficiency of the work of high-voltage power grids.

However, political and expert circles are not quite so sure. In the center of the discussion is the fact that now all processes of the import and export of electric energy in Armenia will be controlled by one person who is a representative of Russian businesses. Three weeks ago, the state approved of an investment program of the same Russian company, Tashir Capital, which will construct a large hydroelectric station on the Debed river, which is in the country’s north-east corner. Several months earlier, Tashir Capital acquired the Hrazdan Thermal Power Plant.

Since 2006, the Electric Networks of Armenia company has belonged to the Russian company ‘INTER RAO’. In 2015, the company announced that it intended to raise the tariffs on electricity. This gave rise to serious discontent in Armenia, and eventually transformed into full-fledged protests on the street. These protests were called #ElectricYerevan. In the end, the intended price hike did not take place.

Afterwards, ‘INTER RAO’ announced that it had debt issues and sold 100 percent of its shares to Tashir capital. In Armenia this was assessed as a positive result, as Tashir Capital belongs to Samvel Karapetyan, and people thought that the energy system of Armenia would, to some extent, be safer from Russian influence and control.