Introduction:

Systematic inquiry and careful analysis of opportunities available for having a bigger share of projects already defined or to-be-defined in the target countries maintains to be top on the agenda of Investment Projects Division. This Division currently concentrates on three major areas of industry i.e. power plant, oil & gas and rail transportation. Investment Projects Division has under-construction, a number of key power plant projects, of which, some have already been commissioned and put into operation.

Investment in Power Plants:

Within the project investment process, Investment Projects Division concentrates on prescribed BOT (build, operate, transfer), BOO (build, operate, own), and Buy-back schemes. The BOT scheme which is employed for the financing of infrastructural projects entails a host of other advantages such as transfer of technology, training of manpower, development of the national and local markets as well as development of fresh financial instruments and vehicles.
BOT implies a model or structure in which investors from the private sector have a share of and contribute to the development of the public sector’s infrastructures. “Project-oriented Financing” constitutes the foundation of such projects meaning that providers of facilities and loans delve for project assets and returns rather than other guarantees such as government securities or assets of the initiators of projects.
In a BOT project, a private sector company is granted authorization for the construction and operation of complexes or installations that are otherwise usually built and put into operation by the government. Such installations range from power plants, airports, pay-toll roads and tunnels to water treatment units, etc. Relying on such an authorization, the private sector company initiates to finance, design, build and operate the project. During the authorization period, the Company, supplies to the government, products and services thus produced on a monopolized and guaranteed basis in compliance with a pre-determined formula. In the conclusion of authorization period, the Company transfers ownership of the project to the government and thus a BOT project is completed. In certain cases, however, a governmental or even private-sector company may, as the purchaser of services or products, replace the provider of monopoly.
 BOO scheme is very much similar to BOT scheme with the exception that upon termination of authorization period, full ownership of installations is transferred to the investor company and extension of cooperation between the investor company and provider of monopoly shall be subject to mutual agreement.
 
Sale of Electricity:

The following include four procedures for the supply and sale of electricity foreseen in the executive bylaw on the conditions and guaranteed purchase of electricity by the Council of Ministers:
- Utilizing Facilities of the Nationwide Electricity Grid for the Sale of Electricity to Target Consumers.
In this procedure, the Suppliers are authorized to sell all or part of the energy they generate to consumers within the framework of mutual agreements and subject to coordination with the network management and payment of connection and transfer fees.

- Supply to the Nation’s Wholesale Energy Market and Capacity and Energy Sales to Network Management
In this procedure, the supplier of energy supplies electricity to the wholesale market. Also in this procedure, the possibility does exist for the signing of a long term agreement with the network management in which case the base rates shall be subject to adjustment taking into consideration time, technical and economic factors.

- Signing of Long Term Sales Agreements with Tavanir or Network Management
In this procedure, the applicant already qualifying for the construction of power plant is permitted, during the bid or through withdrawing tender formalities, to sign a long term agreement with Tavanir for the purchase of electricity or conversion of energy. Base payment rates are subject to adjustment in compliance with time, technical and economic factors.

- Sale of Electricity at Guaranteed Rates
In addition to the wholesale market procedure, the network management is also allowed to purchase electricity at guaranteed pre-determined rates. These rates differ depending on load fluctuations and peak seasons. The executive directive of this procedure has not been communicated yet.

Currently, sale of electricity through the following two procedures is possible for the Investment Projects Division:

1- Direct sale of electricity to major purchasers (Tavanir Co., Iran Electricity Network Management) in accordance with long term energy conversion contracts.
2- Sale of electricity to major consumers (industrial factories, steel, oil and petrochemical industries) in accordance with the contract for securing consumers’ electricity needs and the possibility for transit through the nationwide grid.

Additionally, the steam requirements of oil and petrochemical industries shall be foreseen in long term contracts.