Iran's Five-Year Plans of Renewable Energy Policies: History
Please note this is an old version of this entry, which may differ significantly from the current revision.

Renewable energy (RE) policies can play an effective role in the development of renewable resources. Iran’s current RE policies need to be reviewed, reformed, and strengthened. 

  • energy
  • policymaking
  • energy policy
  • fossil fuel
  • quantitative analysis

1. Introduction

Today, ensuring a reliable and sustainable supply of energy as well as an appropriate demand market is a crucial concern of any government for comprehensive development. This is only possible with energy policymaking [1][2][3] at all levels of national governments and at the international level. Governments face challenges such as fluctuating fossil fuel prices, rising global energy demands, uncertainty in oil and natural gas resources [4] due to geopolitical concerns, and global warming [5]. Thus, energy has become an important economic challenge [6], and it has attracted the attention of policymakers [7][8]. Hence, policymakers have begun to focus on adapting the existing policies to continuous changes [9][10]. Energy policy is an important tool for influencing on societies’ economic, political, and social activities [11][12]. Energy policies are the basis for the use of renewable energy (RE), and policy frameworks are the most appropriate tools to support the establishment of this type of energy in different contexts [10]. The RE policy is a new topic in the history of science and it is not more than half a century old [12].
In Iran, the government has been seeking to use renewable resources for years. Unfortunately, the share of renewables in Iran’s energy plan is still very small and, so far, only 823 MW of electricity has been generated through RE in Iranian power plants [13]. In 2018 (1397 Persian year), the country’s renewable power plants produced 124.21 MW of solar energy and 12.5 MW of wind energy [14]. Furthermore, 21 new power plants with a total capacity of 85.136 MW were established [15]. However, these measures are far from the vision of the sixth 5-year National Development Plan. In Iran’s sixth 5-year National Development Plan (NDP), as part of a 30-year plan by 2050 (1429 Persian year), the growth in the share of renewable resources is targeted to be up to 5000 MW [16]. While all countries are trying to accelerate and facilitate the use of RE through appropriate policies, Iran is no exception and has been following this path for years [17][18]. This is much more important for Iran due to fossil fuel resources limitation, high annual growth of energy consumption in Iran, and Iran’s egression from the oil exporters group at the end of the present century that will affect the country’s development process [19].
In 2017 (1397 Persian year), the Iranian government had planned to increase its total electricity production capacity by 5% or close to 44 GW by 2021 (1400 Persian year) [15][20]. Aryanpur et al. [21] have stated that Iran intends to increase its share of RE to 32% by 2050 (1429 Persian year). This not only allows for the use of an alternate solution in other applications with greater economic benefits, but it also makes participation easier. Improving air quality in large cities with the help of wind energy is another RE development program in Iran [22]. The establishment of an RE program in Iran can help the country achieve its energy security, independence, and future climate goals, as well as turning significant energy supply crises into opportunities for business interests, technology research, exports, and job creation [21]. Iran’s economy can be planned based on known and predictable electricity costs in the future because it is supplied from domestic sources and is free of any security, administrative, economic, and environmental challenges associated with oil and gas [15][23].
Appropriate steps must be made to maintain the sustainability and continuity of Iran’s worldwide presence in order to meet international responsibilities, particularly the Paris Agreement, and to safeguard the country’s economic future, which is inextricably linked to energy [20]. Despite its enormous potential for RE generation, RE’s contribution to Iran’s energy basket is now insufficient [24]. Ineffective policies (such as a lack of innovative initiatives, a lack of improved public services, the systemic and conventional structure of public policy, and a lack of financial resources) are among the reasons for the failure to use RE [21]. Iran has adopted policies in five-year development plans and related upstream national documents, and varieties of programs have been designed to achieve those goals [23]. In this way, understanding all aspects of the key issue is essential to adopt the right policy. It is necessary to identify and address the shortcomings of these policies as well as their strengths, but the types and dimensions of policies that have been adopted so far are unknown, and the weakness of studies in identifying renewable policies in Iran is evident. As a result, a systematic scientific understanding of the country’s RE sector’s planning and policymaking structure, adaptation of existing policies to the needs of society, appropriate types of policies, and appropriate mechanisms for RE development appear to be required. To achieve this framework, analyzing the plans and upstream national documents related to renewable policies will play an important role. These documents are policies, laws, and regulations designed and approved for the development of RE by various governments of Iran over the years and are considered as a roadmap to access a variety of RE resources. The oldest versions of these documents have been drafted in 1973 (1352 Persian year), and the newest ones were approved in 2017 (1396 Persian year).
In 2017, the RE production sector mainly included 53.88 MW of wind energy, 13.56 MW of biomass energy, and 0.51 MW of solar energy and as mentioned above, in 2018, the total installed capacity was increased to 823 MW. However, only 0.2% of Iran’s energy is still produced from renewable sources [25]. Iran’s goal, according to the sixth NDP (2017–2021 and 1397–1400 Persian year), is to generate 5% of its electricity, with the goal of increasing the share of RE resources which have not materialized yet due to recent droughts and despite Iranian sanctions [18]. Moreover, reports from the Energy Efficiency Organization indicate a delay in the implementation of this program. The development of RE resources can be considered a positive step according to the current program of Iran, and more active and more important issues such as biomass should be adopted [15][26].
Many studies [27][28] on RE policies have been conducted, but the majority of these studies are quantitative in nature and focus on the investigation and performance of one or more policies. Furthermore, most studies have focused solely on the development of renewable electricity [29][30] or biofuels [31][32] or have examined policies in the industry [33] and transportation sectors [34]. However, in order to identify a country’s strengths and weaknesses, its RE development policies must be analyzed and investigated. Huge potential resources remain undiscovered and underused due to lack of awareness and ineffective government policies.

2. Current Discussion

Researchers attempted to merge two codes at first but, after consulting energy policy experts, researchers determined that the keywords of the two codes are slightly different. The first part of the sentence refers to “use”, which means that this can happen anywhere in the country and can increase the use of RE. The keyword in the second part, on the other hand, is “share”. It is worthwhile to investigate the increased use of RE in energy production, but this does not imply that it can be exploited further through energy exports. As a result, researchers examined these two codes separately. The theme of “construction of power plants and the development of renewables” contains the greatest number of policies in the field of renewables. About 100 policies fall into this theme. The most repetition was related to the policy of “constructing power plants for RE production” with nine repetitions and “increasing the share of RE” with eight repetitions. “Increasing the use of RE” seems to be a sensible policy, but considering the fossil fuels cheapness in Iran, in the current situation, an effective plan is required to convince people to move towards replacing these types of fuels. Currently, subsidy discrimination between RE and fossil fuels is about 90%, and this is a huge obstacle to the expansion of the use of renewables instead of fossil fuels. “Endeavoring to increase RE considering the priority of hydropower” is a policy that does not conform to the current situation in the country. Problems such as declining rainfall, prolonged droughts, and lowering groundwater levels are preventing this policy from being implemented. Onifade [35] also stated in his results that new renewable policies should be adopted and implemented.
In the theme of “vision and policymaking”, the most emphasis is on the renewable electricity guaranteed purchase, which has been repeated 10 times in various documents. However, about other types of RE, such as heat or biofuels, there is no guarantee to purchase renewable electricity by the government. This could be a detrimental gap because the production and use of biofuels are on the rise around the world, and governments are paying special attention to these types of energies. In addition, the focus of incentive tariffs is on renewable electricity. It is necessary to make a difference for each type of wind, biomass, and geothermal energy to avoid the policy of non-development and prevent the transfer of huge profits from the governmental sector to the private sector. These findings suggest that this policy should be revised. This type of policy is being adopted and implemented in many countries, with success in some, such as Germany. Even at the household level, the government in Germany provides guaranteed purchase policies [36]. However, in some countries, such as Kenya, the guaranteed purchase policy has not been implemented successfully [37]. For the geothermal, there are different types, such as conventional geothermal energy, hot dry rock, etc. According to Cui et al. [38], the geothermal power generation cost ranges from 0.086 IRR/kWh to 0.095 IRR/kWh, which is a little higher than the conventional power generation cost. Double-flash or flash–organic Rankine cycle is suggested to be installed for geothermal power generation if more electricity is needed. In addition, in another study by Cui et al. [39], they showed that coupled migration and retention of suspended injection particles and reservoir particles can severely damage the formation, especially for weakly consolidated sandstone geothermal reservoirs. Massive detachment of reservoir particles, formation of wormhole-like preferential flow paths, and retention of the injected suspended particles are identified as three successive stages during geothermal energy exploitation via water recycling. The mobile reservoir particles play a leading role in the first two stages, while the injected suspended particles mainly affect the last stage. The high injection-production pressure difference and low concentration of injected suspended particles are conducive to form preferential flow paths, but a severe local reservoir blockage may occur under high mobile reservoir particles [38]. By separating tariffs, the private sector’s revenue will be reasonable, and there will be incentives to attract private labor. Onifade [35] also emphasized that there is a need to use policies such as incentive tariffs and strengthen these policies. Bulut and Muratoglu [40] came to the same conclusion in their findings. In the case of the policy of “gradual elimination of petroleum products subsidies”, it is necessary to determine its time and amount. Subsidizing fossil fuels and lack of economic support for renewables will prevent the private sector from active participation. “Policymaking centralization in the unified organization” is one of the policies that has been rightly mentioned, but in practice, this is not the case, and several institutions and organizations are involved in policymaking. “Targeted energy subsidies” was repeated twice. “Encouraging the private sector to participate” was repeated four times, and the goal of providing up to 55% of the investment in RE by the private sector was mentioned too. However, the way of financing, as well as the type of support, and the required financial resources have not been specified. The proposal of a guaranteed purchase rate of renewable electricity is implemented by the Management and Planning Organization, but its approval is at the discretion of the Economic Council. This contradicts the policy of “policymaking centralization in the unified organization”.
In the theme of “laws and regulations”, discriminations in the renewables development laws were observed. For example, the preparation of the atlas for renewable resources has been repeated twice in general, but the case of geothermal energy has been considered separately. The issue of financing the projects of transforming waste into energy has been mentioned separately, while Iran has a very high potential for solar and wind energy [16][41]. The development and implementation of waste disposal and recycling guidelines for each sector of production should be defined separately, while it is generally mentioned in the policies. This seems very important and necessary in the agricultural sector because the agricultural sector of Iran leaves a significant amount of waste every year [42]. This matter can be a huge potential for biofuel production. However, little attention has been paid to biofuels in the theme of laws and regulations. The special rules of renewables that have an emphasis on the agricultural sector are weak. Of course, apart from geothermal energy, other energy types have not been mentioned separately.
In the theme of “institutions and organizations”, the emphasis is on supporting the private sector in RE production. The results of Schmid et al. [3] also showed that private sector participation played a key role in developing the installed capacity of renewable electricity. However, there are many contradictions in this theme. For example, in the adopted policies, the task of identifying the required technology in the field of energy has been assigned to the Ministries of Oil, Industry and Mining, Agriculture, and Power, but elsewhere it has been emphasized and repeated that all the duties of the Ministry of Agriculture, Atomic Energy Organization, and other institutions in the field of RE should be transferred to the Ministry of Power. It was also noted that the Ministry of Petroleum should support the use of RE in solar water heaters, photovoltaic systems, wind turbines, wind pumps, and gas extraction from biomass resources (gasification). Here, the level and amount of support is not defined, and it is inconsistent with entrusting all the renewable affairs to the Ministry of Power. In this theme, cooperation between institutions and organizations is emphasized.
The analysis of the theme of “agriculture, water, natural resources, and the environment” showed that most policies in this sector emphasize the use of agricultural and forestry waste in the biofuels production which, due to the high rate of agricultural waste in Iran, there is a great potential in this sector. “Electrifying agricultural wells” is one of the most repeated policies. According to the statistics provided by the Ministry of Power, in the country, there are more than one million water wells, including deep and semi-deep, which have been drilled with legal permits. The number of deep wells dug in the country is over 205,511 rings and the number of semi-deep wells is 553,087 [43]. The amount of electricity consumed by this number of wells is significant. Therefore, the use of renewable resources to generate electricity, in addition to saving electricity consumption, reduces the heavy costs it imposes on the government. Water pumps play an important role in agricultural water management [44]. “Developing the use of new technologies in the agricultural water sector” reminds of the need to use solar and wind pumps. However, special policies for the development of solar and wind energy in the agricultural sector have received less attention, and in addition to adopting policies to expand the use of solar and wind energy in this sector, extension training is needed for farmers and rural people, especially rural women who have an important role in agriculture.
The theme of “knowledge and applied research” emphasizes the acquisition of technology and supporting research related to RE. In this theme, the supporting research has been repeated many times, and the connection between industry and universities has been considered necessary. The link between “industry and university” is a supplementary policy for the “development of need-oriented engineering sciences” policy. In addition, wind and solar energy are also priorities in this part of policies, which conform to the potential of renewable resources in Iran. “Promoting the knowledge of access to freshwater such as solar desalination” is a policy that can help provide drinking water resources for the country because Iran has an average rainfall of 250 mm per year and this is one-third of the global average rainfall [43]. Droughts in Iran have caused a lot of damage and water scarcity is a serious problem [45]. Due to the large number of sunny days in Iran [43], this solar desalination will meet the water needs of deprived areas.
The seventh theme is named “energy efficiency. In the theme of energy efficiency, there was a lot of emphasis on “consumption pattern reform”, which was repeated eight times, and “increasing the efficiency of power plants”, which was repeated four times. It also points to the construction of combined cycle power plants which can be more efficient. Energy losses in Iran are high. Iran, with a population of 80 million people, pays IRR 45 billion in yearly energy subsidies, whilst China, with a population of 1.5 billion people, pays IRR 38 billion. Therefore, energy subsidies in a country such as China, which has a population 18 times that of Iran, are about 7 times lower than in Iran, and that can be very thoughtful for policymakers and planners. According to the statistics from the Parliament Research Center [46], the loss of power plant conversion was 63.1%, amounting to 253 million crude oil barrels. The Parliament Research Center has emphasized that by converting gas power plants into a combined cycle and increasing the efficiency of power plants, it is easy to prevent energy loss in this sector [46]. This amount of unauthorized losses can be prevented by correcting inefficiencies. “Using new energy in buildings” is very effective in reducing energy consumption and increasing efficiency, but it has not yet achieved much attention in the implementation phase. According to the country’s energy balance sheet in 2016, 396 million barrels of crude oil are consumed annually in the domestic sector [47].
The “market and energy economy” theme was the eighth theme to be investigated which, of course, has not been properly addressed. The policies of this sector often emphasize the “economic use of clean energy” but do not define the necessary strategies and financial resources. Target markets must be identified and needs assessment is necessary to be conducted. “Achieving a 10% share of equipment exports of all renewable equipment” is a policy that requires a long way to go and, of course, requires more supportive policies and infrastructure, as it has not yet been successful in meeting domestic needs.
The next theme was the “education, extension, and development of human resources” theme, which included 24 codes. Education and extension are important factors in the development of production and the use of RE. Education, extension, advertising, and culture-making are the policies that have been mentioned many times. RE is mentioned in all the policies in general, but geothermal energy is specifically referred to as “education, culture-making, and awareness of geothermal energy”. Holding exhibitions and implementing sample projects are the policies that can be effective in introducing RE to society. The policy of establishing RE cooperatives can play a significant role in the development and exploitation of this kind of resource, but despite the emphasis on the upstream documents, the implementation of this policy has still failed to be successful. In addition, the issue of RE cooperatives has not been addressed, but it should be. Germany has been very successful in this regard. Participation in these cooperatives can increase the social acceptance of projects [48], and Iran can also take advantage of these experiences. Such experiences also focused on training, education, and access to skilled manpower. However, most of all, it has insisted on specialized manpower in the field of solar energy. It is clear that it is necessary to strengthen international relations so that human resources can benefit from the experiences and knowledge of developed countries in this field, but the major obstacle in this way is the political and economic conditions in Iran, which is facing international sanctions. In addition, some policies are needed to train specialists in other areas of energy, such as wind, geothermal, and biomass. The human resources dimension has received less attention and, if well strengthened, it could play a significant role in job creation.
The theme of “localization of renewable technology and equipment” includes 10 codes that emphasize the use of localized technologies, but in this theme, all the technologies were mentioned in general, and only the solar energy and the photovoltaic system are emphasized separately. Considering the slow development procedure of renewable technologies in current days, “achieving the first rank in local industrial production of solar thermal technology and photovoltaics”, “presence among the top 5 Asian countries in competitive domestic industrial products”, and the “localization of renewable equipment up to 80% of installed equipment up to 1404” seem too dreamy.
The last theme was the “international cooperation” theme which included 10 codes related to RE development. Iran’s membership in the International RE Agency and Iran’s adhesion to the Kyoto Protocol were among Iran’s most important legal actions. Cooperation with international institutions and companies is an effective step in advancing the exploitation of renewable resources, but in the current situation and given the sanctions imposed on Iran by the global society, there are widespread obstacles in this way. At a glance, it can be said that the policies in this area are weak and need to be strengthened. Chen stated that international cooperation between countries is effective in developing renewables [49]. Chang et al. [28] also concluded that cooperation between countries could help develop renewable markets.
Due to its various environmental and climatic conditions, Iran can supply energy from various renewable sources. Because of the abundance of fossil fuels and due to the high investments of the past, strategies and proper measures related to RE resources have often been ignored [22]. Moreover, until the late 1990s, there was no special plan for RE resources in Iran’s policy records [13][22]. Because of the low cost of energy from fossil resources in Iran, government employees, artisans, and customers are less interested in using RE resources [26]. The first general policy document of Iran, published in 2000, is related to RE resources [50]. Because of environmental concerns, the document emphasizes the variety of energy resources in Iran, efforts to increase the share of RE with hydropower priority, and efforts to obtain technology and scientific information of new energy and power plants such as wind and solar, fuel, and geothermal energy [50]. The 6th 5-year Economic Development Plan Act in 2017–2021 was the first document that emphasized the performance of a particular goal for RE [19]. By the end of the program, the government should enhance the share of renewable power plants and electricity capacity with the priority of investment of non-government sectors [45].
In 2011, the Energy Model Modification Act was passed, and Chapter 10 and Articles 61 and 62 of this law describe the application and investment in RE and nuclear energy. Based on this law, the Ministry of Energy should improve the extension of the use of RE resources [50]. To facilitate these issues, measures related to long-term contracts and guarantees for the purchase of non-governmental producers’ renewable electricity can be taken by the relevant organization. The Ministries of Petroleum and also Energy should provide the required assistance to promote the economic use and support of RE resources separated from the network. For example, the Ministries of Petroleum provides publicly announced support for the extraction of gas from biomass resources and cost optimization in the supply and distribution of fossil fuels. Therefore, by 2021 (1400 Persian year), there have been some plans by the Ministry of Energy to enhance the capacity of production power and hydropower plants by 5%. According to the plan, RE programs, on a small scale, have been started to create an incentive for the private sector to invest in power generation plans using wind, solar, mini-hydroelectric, and biomass energy [22]. In recent years, electricity power policies have led to the launching of 134 power plants for customers [50]. This has resulted in the generation of 5035 million kWh of electricity, a reduction of 468 million kWh of electricity network losses, 3417 thousand tons of CO2 emissions, and the elimination of 21.3 thousand tons of other pollutant sources [50]. In Iran, the efficiency and modification of energy structure can have a significant impact on the level of CO2 emissions [20]. Furthermore, it saves water (1108 mL), reduces unemployment by creating 31,271 jobs, and attracts 143.5 trillion IRR in non-governmental investment [15]. The construction of RE settlements will generate sources of revenue, reduce unemployment, and increase government tax revenues [15].

This entry is adapted from the peer-reviewed paper 10.3390/su14031501

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