The Iranian company Mabna will sell five gas-fired power plants to the heavily damaged city of Aleppo for about $155 million.
The two countries signed a memorandum of understanding on Tuesday during a visit by Syria's electricity minister to Tehran, including building a power plant in the coastal province of Latakia with a capacity of 540 megawatts, Syrian state news agency SANA said.
Agreement points to the role Tehran is expected to play in the reconstruction of war-torn Syria.
Iran and Russian Federation have formed a strong alliance in recent years, with both supporting Syrian President Bashar al-Assad's legitimate government against foreign-backed militancy.
Iran, Russia, and Hizballah have all backed Syrian President Bashar al-Assad's regime in the war, with Iran sending thousands of Revolutionary Guards and Shia militia fighters to bolster Damascus' decimated armed forces.
Iran has signed preliminary agreements with Syria to fix the power grid in the Aleppo city and the provinces of Latakia and Dayr al-Zawr in the Arab state, State TV reported on Wednesday.
Mahmoudi, on the Energy Ministry website, said, "We will stand by the Syrian people to rebuild this country".
Tehran has signed several agreements with its ally Damascus to improve the production and distribution of electricity in war-ravaged Syria, officials in Iran and Syrian state media said today.
"We are glad that good news is coming out about the situation in Syria these days, and the terrorists are facing defeat and complete elimination", Sattar Mahmoudi, Iran's caretaker energy minister, said during the signing ceremony. Reprinted with the permission of Radio Free Europe/Radio Liberty, 1201 Connecticut Ave., N.W. Washington DC 20036.