The main sources of alternative (renewable) energy in the country are small HPPs (SHPP). “The scheme of development of Small Hydro Power of Armenia” includes 325 SHPPs with a total capacity of 275 MW and total yearly generation of 833 mln. kWh.

By 2002, 22 SHPPs were operating in Armenia in parallel with the system. The total capacity of operation was 37.7 MW with the generation of 94.5 mln. kWh of electricity. Today, there are 30 SHPPs which include 13 “old” stations, and 17 rebuilt plants. There are currently 20 new SHPPs being built.

In total, the economic potential of the country consists of about 3.2 billion kWh, 1.6 billion kWh of which are being used. According to the Minister of Energy concerning the SHPPs, it is planned to increase the generation volumes by 75 MW. It will generate 400 mln. kWh of electricity per year. Construction and operation of the SHPPs will lighten the load of power complex. Together, it will increase the independence and safety of the sector.

The next important alternative source of power is wind. According to various data, the potential of wind power is assessed as 1-1.2 billion kWh. (See below the new projects and investment expectations.)

In addition, the conditions to attract additional investments for renewable energy are under way. So, the Commission of Regulation Natural Monopoly of the RA set the new generation tariff for the HPPs as $ 0.045 (before was $0.03). They increased the generation tariff for the wind power plants from $0.05 to $0.07.

Other alternative power plants are Solar Water Heating (SWH) setups, wind power projects, biogas setups and fuel elements. Solar power in Armenia was started during the late 1980s. Solar panels (local design) were installed on state entities first and, in the early 1990s, on some private houses. Today solar power technologies are provided by SunEnergy LLC and SolarEn LLC. Wind power is in the stage of study and design. The commercial potential of wind power is assessed as 70 MW. Biogas setups first were used with the SWH system on a small farm in 1998 with the support of the expert center “VISTAA”. On the “Lusakert” chicken farm a biogas setup was created, the biggest in Armenia, with metan tank volume of 50 cb. m, “dry” gasholder volume of 70 cb. m, and system of preparation of working mass. Daily generation of gas is 90-135 cb. m. Since 2003, another generator has started operation in Yerevan with the reactor volume of 25 cb. m. The fuel elements are run by H2 Economy CJSC. This company does research, commercial design and production of hydrogen fuel elements with proton exchange membrane, as well as components and parts related to elements.