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EghtesadOnline: The government-affiliated Power Generation, Distribution and Transmission Company (Tavanir) and Iran Fuel Conservation Company, a subsidiary of National Iranian Oil Company, signed an agreement on Thursday in Tehran to expedite electrification of agriculture wells.

According to the Energy Ministry news portal, as per the contract 75,000 diesel farming wells are expected to be electrified by Tavanir at an estimated cost of $1.2 billion.

"The plan will help save 750 million liters of eco-unfriendly diesel per year, which can be exported to international markets at 30 cents per liter," deputy minister of energy Homayoun Haeri was quoted as saying, adding that the win-win collaboration is in the interest of environmental protection.

Not only does the initiative help burn less environmentally-unfriendly fuel and reduce air pollution, it also will decrease maintenance expenses, Financial Tribune quoted him as saying.

Diesel consumption in Iran is close to 85 million liters per day, up 11% compared to 2018.

Development and consumption are two wings of economic prosperity, especially under the sanctions regime, he noted, adding, "Now that the former has slowed down due to restrictions, the latter (consumption) must be cut as much as possible."

Referring to the massive energy consumption in the country, he said the total consumption is equal to energy produced by burning 1.4 billion barrels of crude oil.

"If anything this pattern is not sustainable and will definitely undermine energy development goals," the official said, adding that by conforming to prudent consumption patterns, the “equivalent of 500 million barrels of oil can be saved annually.” He did not go into details. 

IFCC says more than 35% of the energy is consumed in buildings. Industries and agriculture account for 24% and 17% respectively and the remaining (24%) or the equivalent of 320 million barrels is used for transportation.

Regarding energy consumed by vehicles, gasoline, diesel and natural gas comprise 48%, 34% and 15% respectively.

International Energy Agency data show Iran paid $45 billion in energy subsidies in 2017 -- up 55% compared to the year before.

Of the total, $16.5 billion was allocated to oil and oil byproducts, namely gasoline and diesel, $12.3 billion to the electricity sector and the remaining to natural gas



Smart Meters

In related news, the website added that the second phase of National Smart Metering Program (known as Faham in Persian) is underway as planned and five million energy-intensive agricultural, housing and commercial units will have the new meters in two years.

"First phase of the plan began in 2014 and so far 100,000 agro-wells have been equipped with the new devices," Hadi Modaqeq was quoted as saying.

In the first phase (2014 to 2017), 60,000 devices were installed on wells and the number reached 100,000 in 2018. 

The agriculture sector will have priority in the second phase because placing the new device on wells will help the Energy Ministry efficiently monitor water use that has been reaching prohibitive levels over the years causing serious concern among conservationists and economic experts. 

There are almost 500,000 legal and 320,000 illegal wells in the country, the ministry said earlier.

A smart meter is a modern electricity meter that digitally sends meter readings to utilities, keeps consumers abreast of the consumption levels and ensures accurate billing.


Iran Tavanir Electrification Agro Wells agriculture wells