Increased efficiency in the agricultural value chain through the use of agri-food by-products, which is also expected to contribute to poverty reduction.

Increased availability of biofuel as an affordable energy source for poor households, and reduced deforestation caused by household heating and cooking.

Reduced dependency on use and import of fossil fuel.

Additional deforestation may occur if land is cleared for planting feedstock that can be used for the production of biofuel and biogas.

Depending on the feedstock, leftover by-products may become waste if not used as fertilizer or fuel for operating processing plants, which can harm the environment.

Gasoline, which is mixed with bioethanol, has less CO2 but the blend can produce higher nitrogen oxide levels than gasoline, which is a key component of air pollution that causes smog.

High prices on fuel and electricity may drive more farmers to shift from agri to biofuels. This may negatively affect changes on the use of land and food production.

The scale-up of biofuel production may be limited by insufficient supply of manure and other agri-food by-products/

The scale-up of biofuel production and be limited by the lack of a comprehensive regulatory framework.

Households may prefer continue using timber or dried manure as an energy source, which may create uptake challenges.

Increase income and resilience of households and farmers, reduce environmental footprint from energy consumption, and enhance the agri-food supply chain efficiency.

The promotion of renewable energy technologies and enhancing the renewable energy capacity, including biofuel energy production, are high priorities for the Government of Armenia, as outlined in the Government Plan 2019-2023 (1).

Financial incentives: Armenia offers various financial instruments, such as green leasing, that offer below market interest rates for renewable energy production. Beneficial tariffs are applied for renewable energy producers (2, 7, 8).

Fiscal incentives: Armenia extends tax privileges for importation of materials and equipment for the renewable energy industry, which also allows for extended VAT payment times for imported products (10).

Energy tariffs are set by the PSR Committee and beneficial tariffs are applied for electricity from renewables (solar, wind and biofuel). The tariff for biofuel energy is applied since 2011 (with a 5.92 AMD 16% increase in 2012) (27).

Industrial biofuel power stations with power exceeding 500 kWt are subject to licensing by the Public Services Regulation Committee. If biofuel production does not transfer to industrial electricity production, there are no regulatory requirements for establishing biofuel production (32).

The Standard AST 330-2010 – establishes requirements for biofuel production (35).

The Law on Renewable Energy and Energy Efficiency increased the net metering limit for legal entities from 150 kWh to 500 kWh, to allow large energy consumers to execute functions of autonomous power generators to meet their own needs. The Law also improved the energy transit timetable (9).

Feed-in tariffs are applied in renewable energy sector, which means that households are allowed to sell the excess electricity to electric networks, including for small-scale biofuel energy projects (9, 27).

Biofuel energy producers, such as the Lusakert Biofuel Factory; biofuel crop farmers; animal farms and agri-food processors that provide raw material for biofuel, such as the BioRuralHeating project farmers under the EU4Energy Initiative.

Public Services Regulation Committee, Ministry of Territorial Administration and Infrastructure, Ministry of Environment, Ministry of Economy.

Several international financial institutions and multilateral banks support the promotion of renewable energy, such as the World Bank, European Bank for Reconstruction and Development (EBRD) and the Asian Development Bank (ABD).

Renewable Energy Producers’ Association Union of Legal Entities.

Active partnerships, such as projects under the EU4Energy initiative, which are supported by international financial institutions (e.g. World Bank and GEF project to promote bio-ethanol production).