The undisclosed company will carry out the development of several solar farms in Tehran, Tabriz and Isfahan, as part of the deal, media sources reported citing Great Tehran Electrical Distribution managing director Ali Barband.

Under the agreed terms, the firm will be offered land on 20-year lease at a reduced price for the development of the projects.

As reported in Press TV, the company will construct 150MW in Kahrizak, 200MW in Varamin and 150MW in Malard.

Additionally, 750MW of solar projects will also be developed in central Isfahan and northwestern Tabriz.

Barband was quoted by Mehr News Agency as saying that the utility will fully finance the projects in exchange for a guarantee on electricity purchase.

Construction on the first solar power plant is schedule to begin in early 2016, with planned completion in May 2016.

Barband added: "The envisaged plan is to increase power generation capacity during the post-sanction era by various means including foreign direct investment, construction of new solar, wind and incinerator plants as well as building small-scale plants with distributed generation."

The Energy Ministry is already developing 500MW of wind converters and 100MW biomass projects in a bid to achieve government’s goal to generate 5,000MW of electricity using renewable energy sources by 2018.

German companies are reportedly planning to invest $331m next year to build wind power plants in the country.

A consortium of Iranian, Indian and South Korean companies are considering investing $10bn to launch an energy park, which includes 1,000MW of solar power projects, in the Khuzestan province.

Barbandi said that plans are underway to reduce electricity network grid losses in Tehran to less than 10% from 13%. The losses have already been reduced 5% in the region over the past year.