In recent years, in conditions of the Armenian dram’s strengthening, approximately AMD 20 billion in surplus funds have accumulated annually in Armenia as a result of purchasing natural gas. This was reported by expert Vahe Davtyan.
Referring to his own sources, Davtyan noted that by August the surplus amount had reached AMD 40 billion. He explains that these funds could have served as a basis for reducing the gas tariff in the country, yet the authorities decided to go a different way.
“In 2024 a decision was made not to reduce gas tariffs, and the funds accumulated were directed toward the construction of new gas infrastructure in Yerevan, even though this should have been financed through new subscriber connection fees. Those fees, of course, continued to be collected, and in July 2024 the PSRC decided to allocate part of those amounts for the construction of a new gas pipeline in Kirants — a matter which also remains unresolved,” the expert asserts.
According to him, by decision of the PSRC in December 2024, about AMD 13 billion of these accumulated funds were directed toward covering the deficit of electricity tariffs. By the same decision, the gas tariff for the thermal power plants was set at an illogical low of USD 46 per 1,000 m³, with the remaining difference subsidized from the aforementioned funds.
“The question arises — where and how did this tariff deficit form? The problem falls within the domain of foreign energy policy. In 2024 Armenia imported less gas from Iran than was stipulated by contract, which resulted in a tariff shortfall of AMD 13 billion in 2025. And as in all other cases, rather than speaking directly about the problem and looking for solutions, the authorities are covering up the situation: preferring to go the path of subsidizing electricity tariffs devoid of economic calculation,” he claims.
The situation becomes even more complicated, Davtyan notes, due to the rules in the liberalized electricity market. “Specifically, as a result of liberalization, consumers who entered the market pay less for electricity than before, while producers who entered the market sell their electricity at higher prices. This situation is indeed absurd, yet it is precisely the difference created thereby that is in fact borne by ordinary consumers: that is, 1.1 million consumers pay higher in order for about 300 consumers to benefit from cheaper electricity,” he said.
Davtyan emphasizes that he has repeatedly spoken about whether market liberalization constitutes a direct risk to Armenia’s energy security — and the data provided here proves it “on the ground”. “In the created situation it becomes obvious that in Armenia the suppression of electricity tariffs is of a highly temporary nature. Probably, through the application of the same schemes they will be maintained next year as well, which is logical given the forthcoming electoral processes. However, an artificially maintained tariff cannot be of long-term nature: the ‘tariff bubble’ will sooner or later burst — leading to numerous socio-economic risks,” he said.