Armenia has no proven reserves of oil or natural gas and currently imports nearly all gas from Russia. The Iran-Armenia Natural Gas Pipeline has the capacity to provide twice the country's 2008 natural gas consumption and has the potential to provide energy security for Armenia as an alternative to the Russian-dominated imports that flow through the Georgian border. Despite a lack of fossil fuels, Armenia has significant domestic electricity generation resources. The Armenian electrical energy sector has had a surplus capacity ever since emerging from a severe post-Soviet crisis in the mid-1990s thanks to the reopening of the nuclear power station at Metsamor. The Metsamor Nuclear Power Plant provides 42.9% of the country's electricity. Armenia has plans to build a new NPP in order to replace the aging Metsamor which was built in 1979. The country also has eleven hydroelectric power plants and has plans to build a geothermal power plant in Syunik. Most of the rest of Armenia's electricity is generated by the natural gas-fired thermal power plants in Yerevan (completed in 2010) and Hrazdan. 

The fuel in Armenia is provided through private companies, such as Ran-Oil LLC, Flash LLC, CPS Oil Corporation Co. LTD, Max Oil LLC. There is no government entity controlling the fuel market except for the Customs/Tax office and quality testing laboratories. Most of UN agencies and NGOs have a contract with one or two distributors. A coupon system or cash payments is common. According to the quantity, some distributors can provide tanks to the organization if requested and then deliver fuel on a regular basis. Distributors also provide fuel out of Yerevan, on some remote bases. The fuel price is higher than in other countries in South Caucasus due to the transport cost. Due to high prices many of vehicles are using propane as alternative source of fuel; these systems are installed locally by specialized personnel. Almost all public transportation such as buses, taxis and private vehicles are operated by propane. 

In case the Nuclear Power Station stops its activity, Armenia will become very much dependent on imported fuel, which will affect all the aspects of economic life: having shortages of energy, making the prices go higher, etc. 

For more information on government and fuel provider contact details, please see the following link: 4.1 Armenia Government Contact List

Information may also be found at: My Travel Cost Website which is updated monthly. 

Fuel Pricing 

Fuel price at local market is composed from the following: international price, transport cost, taxes. Taxes are paid during import clearance at the border. It is fixed amount per ton. The prices of fuel have decreased during the last 12 months: 12% for petrol and 7% for diesel.  

Seasonal Variations 

No major seasonal variation, suppliers are very well aware when there is a high need of fuel, for instance at the beginning of agricultural season and are ordering adequate quantity way in advance. 

Fuel Transportation 

Currently, Armenia is connected to foreign fuel suppliers through a single transportation corridor - the neighbouring Republic of Georgia. A single rail link and natural gas pipeline through Georgia are the only means of importing fuel to Armenia. Fuel must be shipped to Georgian ports and natural gas must transit the Georgian pipeline system to reach Armenia. Reliance on single fuel and natural gas transportation links reduces the reliability of fuel supplies to the Armenian market. 

Standards, Quality and Testing 

Quality of fuel is checked during importing process, quality is checked in accordance to former Soviet standard requirement Gost. Testing laboratory of Petroleum products of “National Institute of Standards” CJSC is accredited 2009-12-28, accreditation certificate N AST-001. Q-0035-2009, identification designation E 09. 

Testing laboratory of Petroleum products carries out testing: 

- for conformity assurance; 

- on demand of legal entity and individual; 

- on demand of governmental authorities and non-governmental organizations. 

Testing laboratory of Petroleum products is accredited according to the requirements of HST ISO/IEC 17025-2005 “General requirements for the competence of testing and calibration laboratories”.