Renewable Energy in Azerbaijan

The increasing demand for energy resources, scarcity of traditional energy resources, adverse impacts on climatic conditions because of use of hydrocarbon resources have necessitated use of alternative and renewable energy sources and “State Programme on Use of Alternative and Renewable Energy Sources in the Republic of Azerbaijan” was approved by the Order (nr.462, dated by 23 October 2004) of the President of the Republic of Azerbaijan and thereby a new development period for this area has begun in our country.

For time being, the share of alternative and renewable energy sources (ARES) makes up 16,8% of total investment power in total electricity production and so electricity in amount of 1.8 billion kW-hr was produced in our country for 2015. Thereby, natural gas in amount of 465 million cubic meters was saved and accordingly CO2 emissions in amount of 1 million tones were prevented in 2015.

The state aims at to increase the share of alternative and renewable energy sources up to 50% in total electricity production by 2050 and thereby to save millions cubic meters of natural gas and prevent CO2 emissions. Study of international experience in use of alternative and renewable energy sources, determination of our country’s capacities, implementation of some small and medium size projects on alternative and renewable energy sources in various regions confirm accessibility of targets put ahead and a three-pillar “energy development model” has been developed within our country’s energy supply concept to reach these targets.

Akim Badalov, Chairman of State Agency on Alternative and Renewable Energy Sources of the Republic of Azerbaijan, declares that all done works will contribute widening of use of alternative energy sources by use of country’s natural capacity, saving of hydrocarbon resources, further strengthening of country’s energy security, use of advanced technologies, strengthening of staffing capacity, improvement of the public welfare due to creation of new workplaces, reaching of environmental protection goals due to reduction of CO2 emissions and reduction of CO2 emissions from the 1990 year level to 35 % in 2030 as “voluntary target” declared at 2015 Paris conference.

Renewable Energy potential of Azerbaijan

Wind power:

Since the wind enters the territory of Azerbaijan from a narrow strip at the shoreline of the Caspian Sea and from the valley between the Great and Small Caucasian Mountains, wind intensification is a recurring weather phenomenon in the surrounding territories. This effect reaches its maximum level both on the Absheron Peninsula, a narrow strip in the Caspian Sea and on Absheron’s offshore zone. According to a study carried out by the State Agency, the average annual wind speed ranges between 7 and 8.5m/s at a height of 80m above the land surface there, and this is categorized as a “highly favorable” energy potential class according to the classification of the International Renewable Energy Agency.

Solar energy:

The mean annual duration of solar radiation in Azerbaijan is observed to be somewhere between 2000 and 3000 hours. According to research conducted by the State Agency, the annual quantity of solar energy falling on each square meter of the country’s territory ranges between 1300kWh and 1750kWh. The International Energy Agency’s (IEA) 2011 Report listed the amount of solar radiation falling on the horizontal surfaces of the territory of Azerbaijan as 1566kWh/m2. According to the IRENA classification, these two measurements are designated as “favourable” and “highly favourable” energy potential classes respectively.

Hydro power:

The full hydraulic power potential of the rivers in Azerbaijan has been estimated at 40 bln kWh, and their technically favourable potential at 16 bln kWh, 5 bln kWh of which are accounted for by small hydro power plants.

Geothermal energy:

Although the temperature of thermal waters in Azerbaijan is not very high, the use of these waters for the generation of geothermal energy is considered to be feasible. The temperature of thermal waters in various areas ranges between 30 and 110oC. The Kura Concavity, the Gusar Foothills zone and the Absheron Peninsula are considered the most ideal locations in this regard. Accordingly, the capacities for potential inputs of 480, 70, and 65MW respectively, exist in these territories. In total, the national thermal waters’ potential is estimated at 245,600m3/day or 800MW.

Biomass and Waste:

There are approximately 2.7 million large horned mammals and 10 million small horned animals and 25.5 million poultry in Azerbaijan, and the quantity of their total annual discharges approximately equals 25 million tons. The annual volume of solid domestic wastes from large cities comprises 2.4 million tons. Additionally, quite significant quantities of wood splinters, wood processing wastes, agricultural residues and other wastes and animal discharges are accumulated in Azerbaijan each year. All these have enormous potential as renewable bioenergy resources.

The expansion of the use of alternative and renewable energy sources in our country began by establishing “The State Program on use of Alternative and Renewable Energy Sources in the Republic of Azerbaijan” which was drawn up at the initiative of Ilham Aliyev, President of Azerbaijan and approved by his Decree # 462 dated October 21st, 2004.

Within the framework of activities arising out of the State Program, the State Agency for Alternative and Renewable Energy Sources was established under the auspices of the Ministry of Industry and Energy of the Republic of Azerbaijan in 2009. In order to improve the management of this industry, the State Agency for Alternative and Renewable Energy Sources of the Republic of Azerbaijan and the Agency’s AzAlternativEnerji LLC were established in 2013.

As a result of the approved state programs and structural reforms, 10 new hydro power plants in the Nakhchivan Autonomous Republic,Fuzuli, Ismayilli, Gusar, Shabran, Sheki, Balaken and Shamkir regions, a heating plant at the Solid Household Waste Incinerator in Sabunchu District in Baku, 4 wind power plants in the Khizi and Absheron regions, a hybrid power plant in Gobustan, solar power plants in the Samukh region and in the Nakhchivan Autonomous Republic, as well as in the Garadagh, Sabunchu and Pirallahi districts of Baku, and sports centres supplied with energy from renewable energy resources in Masalli and Beylagan regions were built, while solar panels and heating pumps were installed at 24 social facilities in various regions of the country by state and non-state enterprises beginning in 2009. The power plants, with a total output capacity of 259MW, comprised of 63MW of wind power, 33MW of solar power, 38MW of biomass and waste power and 125MW of hydro power were then commissioned. Additionally, the Azguntex Solar Panels Plant with an annual production capacity of 50MW and an enterprise producing solar collectors in the Sumgayit Technologies Park were constructed in Sumgait.

New power and heat generating capacities with a total output exceeding 7650MW from renewable energy sources is slated to be installed in Azerbaijan by the year 2020. Among those capacities, the installation of solar heating plants of 4500MW, solar power plants of 1065MW, wind power plants of 1512MW, biomass plants of 515MW, and energy generating capacities at small rivers of 60MW has been planned. The goal is to increase the share of renewable energy in the production of electric power to 20% and to 9.7% of the total energy supply by 2020. The broad implementation of utilization of ARES will create conditions for the economical and efficient use of energy in the country, increase exports of fuel resources, decrease the volume of hazardous substances discharged into the environment by 20-25%.

International cooperation in renewable energy field

The Republic of Azerbaijan proactively collaborates with a number of countries, regional and international organizations and financial institutions in fields relating to the ARES industry. The Republic of Azerbaijan joined the IRENA in 2009 and became a full member after ratification of the International Renewable Energy Agency Charter in the National Parliament (Milli Majlis) on May 2nd, 2014. The State Agency for Alternative and Renewable Energy Sources of the Republic of Azerbaijan broadly collaborates with the United Nations Economic Commission for Europe, the United Nations Development Programme (UNDP), the European Union, the World Bank, the Asian Development Bank (ADB), the KfW Development Bank (Germany), the French Development Agency (AFD), the United States Agency for International Development (USAID), the Economic Cooperation Organization (ECO), the Black Sea Economic Cooperation (BSEC), the Japan International Cooperation Agency (JICA), the Korea International Cooperation Agency (KOICA), the EU-funded programme INOGATE (The Interstate Oil and Gas Transport to Europe), GUAM, and others, as well as with Germany, Turkey, France, Holland, Sweden, Slovenia, the Czech Republic, Slovakia, Ukraine, Argentina, the UAE, Iran, Lithuania and several other countries.

A Memorandum of Understanding was signed by the State Agency and the Ministry of Energy of the Islamic Republic of Iran in 2014 and between the State Agency and the State Energy Department of the People’s Republic of China in 2015.

Scientific and technical cooperation

The State Agency closely collaborates with relevant institutions in Azerbaijan to promote the introduction of scientific and technical innovation, training of specialists and to increase awareness among energy consumers. Close cooperation relations have been established between the State Agency and specialists from the institutes of Physics, Radiation Problems and Geology of the Azerbaijan National Academy of Sciences (ANAS), the Azerbaijan Scientific and Research Institute of Energy and Power Design, Baku State University, the Azerbaijan Diplomatic Academy (ADA), the National Aviation Academy, Baku Engineering University and other scientific institutions in the renewable energy field.


Beginning in 2011, a number of 85-meter-high measurement, monitoring and control (MMC) units were installed in various locations by the State Agency for Alternative and Renewable Energy Sources to determine the power-producing potential of these areas which were designated for the construction of wind and solar power plants.

Moreover, 7 additional stationary-type MMC units will be installed in the Nakhchivan Autonomous Region and in 6 other regions by the State Agency by 2018.

The MMC units were installed at the following locations:

• on Absheron Peninsula: Pirallahi and Sangachal;

• In the Northern Region: Khizi (Sitalchay), Khizi (Gilezi), Siyezen, and Khachmaz ;

• In the Western Region: Ujar, Samukh, and Aghstafa;

• In the Southern Region: Neftchala, Masally, Astara and Imishli;

• on the lands of the Gobustan Hybrid Power Plant.

Gobustan Experimental Landfill and Training Centre (GELTC)

The Gobustan Experimental Landfill and Training Centre (GELTC), located on 38 hectares of land, was the first hybrid-type power plant built in Azerbaijan and boasts wind, solar and biogas power plants; three wind turbines (each 0.9MW), a 1.8MW solar power plant and a 1MW biogas power plant. A regulation and control facility, a water reservoir, a testing area (polygon), a laboratory and a workshop comprise the other main structures at the GELTC complex. It is possible to monitor and control the power plants and conduct tests from within the laboratory at the GELTC. Training courses are organized and held in two classrooms. The technological processes in the testing area (polygon) and in the centre are managed from the control facility. The complex was built as a means of satisfying the energy requirements of Gobustan City in the initial phase and those of the Gobustan region in the subsequent phases, using energy produced at the plant. In order to achieve this objective, additional power plants are planned to increase the total generating capacity in the Gobustan region in the near future.

The State Oil Company of the Azerbaijan Republic (SOCAR) implemented an Environmental Park project on 9.3 hectares of reclaimed land cleared of oil and oil byproduct wastes in the Gala settlement. 4 wind generator units (each 10kW) and solar panels with a total power output of 20kW were installed in order to alleviate part of the regions demand for power supply using alternative and renewable energy sources.

Surakhani Solar Power Plant

The Surakhani Solar Power Plant (SPP) was constructed and is managed by AzAlternativEnerji LLC, reporting to the State Agency for Alternative and Renewable Energy Sources. The planned output capacity of the plant is 2.8MW and mainly local raw materials and equipment were used in the construction of the plant. The construction of the plant began in March 2014, and it was put into operation on 16 July of the same year.

The plant can produce 4.4 mln kW∙hours of power annually, operating at its present capacity and 6.2 mln kW∙hours of power if it is operated at full capacity. If the plant is operated at full capacity, then over 1.5 million cubic meters of natural gas will be saved annually. About 4.0 mln kW∙hours of power have been produced at the plant as of June 1st, 2016.

Pirallahi Solar Power Plant

Construction of the Pirallahi Solar Power Plant (SPP) with a planned output capacity of 2.8MW began in 2014 and 1MW of this projected output has already been installed and connected to the power grid. About 1.0 mln kW∙hours of energy have been produced at the plant and transferred to the power grid as of June 1st, 2016. Currently, work is continuing to increase the power of the plant up to its designated output capacity of 2.8MW.

AzGunTex Solar Panel Plant

AzGunTex LLC was founded in Sumgayit in 2011. The AzGunTex Solar Panel Plant began operating after its official opening held on the 24th of April 2012. The first line of this plant with an annual production capacity of 25MW and equipped with modern European equipment was installed and commissioned in 2012. AzGunTex LLC products were awarded with the TÜV Rheinland Photovoltaic module qualification certificate in 2012 for their compliance with international standards and high quality. A second production line was installed last year, and consequently the Plant’s production capacity doubled. The solar panels manufactured at the plant are sold only in Azerbaijan at this time, but there is a plan to export these products in the future.

AzGunTex LLC is currently conducting research and development to manufacture small hybrid systems with up to 10MW of power and provide sales points and showrooms for these products in various regions of Azerbaijan.

Improved ARES-based energy supply to social facilities

5 schools and 2 medical facilities in Baku were each equipped with 130kW solar panels and 280kW heating pumps by the State Agency for Alternative and Renewable Energy Sources. Small solar panels (each 70kW) and heating pumps (each 90kW) were also installed in sports complexes in the Khojavend settlement of the Beylagan region which accommodates internally displaced people (IDPs). As a result, the heating and power supply requirements of the sports centres were fully met. 297kW solar panels and 810kW heating pumps were also installed in 6 boiler houses built to supply heating and power from alternative and renewable energy sources to 6 schools and 6 kindergartens in the settlements for internally displaced people (IDPs) in Bilasuvar. Since then, comfortable conditions have been created for students and kindergarten children, and the heating of rooms to up to 24oC has been ensured.

Projects under implementation

Samukh Agro-Energy Residential Complex

Samukh Agro-Energy Residential Complex is a unique project envisaging the use of alternative and renewable energy in the area of agriculture. The purpose of the project is to fully provide the region with power and heating energy through the use of ARES and at the same time to address the issue of an environmentally clean and sustainable energy supply.

Within the framework of the project, 31MW of power (from solar and biomass energy) and 48MW of heat generating capacity (hybrid type) will be provided using ARES. In order to harness bio-energy, a stock breeding farm for3000 head of cattle, a fish farm and vegetable greenhouses will be built on the plot of land a located to the State Agency in the territory of Samukh. 5000 hectares of land is slated to be allocated in order to provide the stockbreeding farm with feed base. The infrastructure for the processing of the agricultural products, as well as a residential complex consisting of 1000 houses for the employees who will work in the complex, and the solar, biomass plants will be located on the SAERC property. This project will be implemented in 3 phases.

Smart Grid Project

The State Agency initiated the Smart Grid (Network) Project which will use ICT Technologies to ensure no-loss delivery to consumers of the electric power generated at the Gobustan Hybrid Power Plant as well as providing for its effective distribution. This grid will supply electric power to Gobustan city in the first phase, and later, to the entire Gobustan region. Under the Smart Grid project implemented for the first time in our country in the Gobustan region, the management of the power grid in the initial phase is expected to be performed using the existing telecommunications system operating on the frequency band owned by the State Agency, and to render other additional services to individual consumers and entities in the subsequent phases.

Garadagh-Sahil Solar Power Plant

Works relating to the construction of a solar power plant with a capacity of 3MW near the Sahil settlement in the Garadagh District which began in 2014 are ongoing. The main reason for building this plant is to supply power to the road and transport system of the adjacent territory, and this Plant will provide lighting for 30km of roadway using alternative energy.

Prospective projects

Wind Island – 1

The Wind Island-1 Project is a unique wind farm connecting the Pirallahi and Chilov islands in the Caspian Sea. The design capacity of this farm is 200MW.

This project also provides solutions to a number of significant problems:

• The creation of a new power generating source on the Absheron Peninsula, in the territory immediately adjacent to consumers and ensuring sustainability in the supply of power to end users;

• Replacing the fossil fuels currently being used for power production and reducing the volume of hazardous wastes emitted into atmosphere; • The creation of infrastructure for a direct motor vehicle transport connection with Chilov Island and the provision of solutions to other related social issues.

The 50MW Hovsan Aeration Plant

A project for the installation of a bioenergy plant to harvest energy from wastes accumulated as a result of the treatment of waste waters at the Hovsan Aeration Plant is also slated to be implemented in the near future. The motivation behind the implementation of this project is to clean waste waters while utilizing toxic gases and wastes to obtain energy. The Turkan and Hovsan settlements will be supplied with heating and electric energy from this station. Moreover, the operation of the station will save some 93.8 million cubic meters of natural gas annually.

Buzovna Eco-Village

The Buzovna Eco-Village will occupy approximately 40 hectares of beachfront land. Two-storey individual houses, high-rise residential buildings and public buildings are designated for construction on this site. This complex will be provided with electric and heating energy from ARES.

Interview with Nizami Asgerov, production supervisor of Azguntex solar panel plant.

Note: All information gathered with the help of the State Agency for Alternative and Renewable Energy Sources of the Republic of Azerbaijan, interviewing officials of the agency and statistics. 


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