The fact that Iran's first nuclear power plant is now onstream is proof that the Islamic republic does not need the ability to conduct uranium enrichment, the US State Department said Monday.

A ceremony was held at the Russian-built plant in the southern Iranian port of Bushehr on Monday to mark the facility reaching 40 percent of its full capacity.

"We would note that Russia's agreement with Iran on Bushehr provides that Russia will provide the fuel for Bushehr and will take back the spent fuel," State Department spokeswoman Victoria Nuland said.

That fact "in our view underscores the point that Iran doesn't need its own enrichment facilities because it can receive fuel from the international community, as it is in this case," she said.

Iran is targeted by UN Security Council and international sanctions over its refusal to suspend uranium enrichment amid fears in the West that it seeks to build a nuclear bomb -- a charge it vehemently denies.

Nuland also said that with the opening of the Bushehr plant, "Iran is now the only country in the world with an operating power reactor that has not ratified the Convention on Nuclear Safety."

She called that fact "quite troubling."

"More broadly, the Bushehr opening doesn't change the fact that Iran still has to meet its larger obligations to the international community and the IAEA," Nuland said.

Mohammad Ahmadian, deputy head of Iran's atomic organisation in charge of power plants, said Monday the Bushehr plant would be linked to the national grid with its full 1,000-megawatt capacity by the end of the Iranian year in March.