The western-led sanctions against Iran have crippled the country’s ability to provide for its 74 million strong population, Reuters reports. Food prices have skyrocketed and many ships holding supplies are waiting for payment before allowing Iran to collect inventory. Meanwhile, sanctions have made conducting financial transactions virtually impossible. While the government’s failure to act could be disastrous for Iranian nationals, one potential upside is that the Energy Minister has recently admitted the importance of beefing up the country’s renewable energy sector.
Fledgling renewable sector
At present, Iran has a fledgling renewable sector. The 250kw solar power plant in Shiraz that is being upgraded to a 500 kW plant will be online by 2015 and the country launched a 484 MW solar thermal combined cycle power plant in Yazd last May.
But these plants alone are not robust enough to replace the oil and gas industry at a moment’s notice.
According to Reuters, Iran is the world’s fifth largest oil producer and the second largest gas holder, so it’s no surprise that the nation has been beset by what some refer to as a natural resource curse. But the glory days of fossil fuels are over.
At the end of 2010, Iran was the first country in the Middle East to cut its energy subsidies in order to stay excess domestic consumption of its own resource, which means that long before the United States stepped up the severity of its economic sanctions, it was understood that fossil fuels are finite resources.
Incentive to go green
But the hardship caused in the last few months may have given the Energy Ministry in particular additional incentive to establish a twofold strategy to maintain its energy security: enliven the renewable energy sector as soon as possible and improve energy efficiency and conservation.
Leaving aside political rhetoric for one second, Iran has long maintained that a nuclear energy industry would create an alternative to fossil fuels, but nuclear energy is not the most viable solution – especially since the country enjoys plenty of sunshine that could feed a stronger solar industry.
Rostam Qaserie, the Iranian Energy Minister, explained at a recent National Energy Conference that “Reliance on hydrocarbon resources in the long run is neither possible nor meets national interests,” according to Reuters.
In the meantime, many of its main customers, including China, are seeking out alternative suppliers.
image via Ali Reza, Flickr
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