“Opportunities for alternative energies depolyment in Iran” By Quentin Minier Under the supervision of Professor Bassem Snaije Sciences Po Spring 2020 This paper has received the Kuwait Program at Sciences Po Student Paper Award The copyright of this paper remains the property of its author. No part of the content may be reproduced, published, distributed, copied or stored for public or private use without written permission of the author. All authorisation requests should be sent to [email protected] Opportunities for alternative energies deployment in Iran QUENTIN MINIER MAY 2020 Table of Contents Introduction ......................................................................................................................... 5 I. Strengths. Potential and assets for low-carbon energies ............................................. 6 A. Geographical potential ............................................................................................. 6 1. Solar power .............................................................................................................. 6 2. Wind power .............................................................................................................. 8 3. Bioenergy ................................................................................................................. 9 4. Geothermal energy ............................................................................................... 10 5. Tidal energy ............................................................................................................ 11 6. Hydropower ........................................................................................................... 12 7. Nuclear power ....................................................................................................... 13 B. Political commitment ................................................................................................ 14 C. Sociological assets ................................................................................................... 14 II. Opportunities. Why developing alternative energies? .............................................. 16 A. Environmental reasons ............................................................................................. 16 1. Climate change mitigation .................................................................................. 16 2. Improving air quality .............................................................................................. 17 B. Increasing oil & gas net exports ............................................................................... 18 C. Employment & economic growth .......................................................................... 19 D. Enhancing international integration ....................................................................... 19 E. Resilience towards future energy shocks ................................................................ 20 III. Weaknesses and Threats. Barriers to low-carbon energies deployment ................ 21 A. Internal weaknesses ................................................................................................. 21 1. Lack of know-how ................................................................................................. 21 2. Lack of raw materials ............................................................................................ 22 3. Lack of funding ...................................................................................................... 23 B. External threats .......................................................................................................... 24 1. Political priorities ..................................................................................................... 24 2. US sanctions against the regime .......................................................................... 25 3. COVID-19 crisis ....................................................................................................... 26 IV. Solutions. Enabling alternative energies deployment .............................................. 27 A. Finding the ideal partners ........................................................................................ 27 1. Which countries can provide Iran’s needs? ........................................................ 27 2. Which countries to import Iranian products? ...................................................... 30 B. Remaining partners under sanctions ....................................................................... 31 3 Conclusion ........................................................................................................................ 32 Appendix I. Post-regime outlook ..................................................................................... 33 Table of Illustrations Figure I.1. Total primary energy consumption in 2017 ...................................................... 6 Figure I.2. Photovoltaic power potential in Iran ............................................................... 7 Figure I.3. Mean wind speed map at 100m in Iran .......................................................... 8 Figure I.4. Maximum electricity generation potential (MW) from different types of biomass power plants un the cities over 250,000 people in Iran .................................... 9 Figure I.5. Technical potential of methane, energy, and electricity generation in different provinces of Iran ................................................................................................ 10 Figure I.6. Geothermal potential areas in Iran ................................................................ 11 Figure I.7. Major Iranian basins ......................................................................................... 12 Figure I.8. Map of countries with main Uranium reserves (% of world reserves) ........... 13 Figure I.9. Number of Iranian-born students in foreign countries (left axis) and share of graduate students among Iranian international students in the US (right axis) ........... 14 Figure I.10. Number of graduate students (left axis) and ratio of faculty members (assistant, associate, and full professors) to graduate students ................................... 15 Figure II.1. Iran March-April 2019 flood damage on agriculture ................................... 17 Figure II.2. Outdoor air pollution in cities in Iran – annual mean PM2.5 2010 ................. 17 Figure II.3. Oil & Gas production and trade.................................................................... 18 Figure II.4. Historical data and projected electricity consumption (1990-2040) .......... 18 Figure II.5. Iranian oil fields depletion levels .................................................................... 20 Figure III.1. Evolution of global environment-related inventions shares in four MENA countries, 2000-2016. ........................................................................................................ 21 Figure III.2. World repartition of oil and mineral reserves needed for renewables deployment ...................................................................................................................... 22 Figure III.3. Evolution of Iranian Government Budget (% of GDP) ................................. 23 Figure III.4. Iranian Government Spending in 2018 ......................................................... 24 Figure III.5. Real GDP growth of Iran (%).......................................................................... 25 Figure III.6. Central Government Budget Balance (% of GDP) ..................................... 26 Figure IV.1. Reactors under construction as of 15 March 2018 ..................................... 27 Figure IV.2. Costs of Global Nuclear Reactors ($2010) .................................................. 28 Figure IV.3. Evolution of the share of renewable energy patents granted by the five main intellectual property offices ................................................................................... 29 Figure IV.4. Manufacturing Value Added for wind turbine, PV module, LED package and Li-ion battery cell in 2014 ($billion) ........................................................................... 29 Figure IV.5. Iranian exports ............................................................................................... 30 Figure IV.6. Crude oil importers ........................................................................................ 30 Figure IV.7. Natural gas importers .................................................................................... 30 Figure IV.8. Evolution of the five main oil importers ........................................................ 31 Figure IV.9. Paths followed by Iranian tankers over May-July 2019 .............................. 31 Figure A.1. Possible design of a 100% renewable MENA Super Grid ............................ 33 Figure A.2. Major precipitating drivers of migration from Iran since 1979 .................... 34 Figure A.3. Trends in the stock of Iranian migrants (left axis) and the migrant-to- population ratio (right axis) .............................................................................................. 34 4 Introduction In many respects, Iran is an energy superpower, given the importance of these flows in its history, geopolitics, economy, and environment. Iran holds the second largest natural gas reserves in the world