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Nazrin Abdul

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Azerbaijan is rapidly advancing its green energy agenda, signaling a decisive shift from fossil fuel dependency toward a more diversified and sustainable energy future. Recent data and high-level government announcements reflect growing momentum across solar, wind, and hydropower development - positioning the country as a potential regional leader in renewable energy.

According to the State Statistics Committee, Azerbaijan’s renewable energy output showed mixed results in the first seven months of 2025. The country generated 334.2 million kilowatt-hours (kWh) of electricity from solar power, a 13.1% increase year-on-year, affirming the success of recent investments in photovoltaic infrastructure.

Conversely, wind power generation saw a temporary dip - falling by 6.3 million kWh (18.6%) to 27.5 million kWh. While this drop may reflect seasonal or operational variations, Azerbaijan’s broader wind energy strategy remains on track, supported by several large-scale projects nearing completion.

Hydropower, meanwhile, continued to serve as the bedrock of Azerbaijan’s renewable mix. Generation from hydro plants rose by 12.5% to 2.1 billion kWh, driven by favorable water conditions and upgrades to existing infrastructure.

Sector investment and economic impact

The total value of production and services in Azerbaijan’s electricity, gas, and steam sectors reached ₼1.9954 billion during January–July 2025, while water and waste management services added another ₼370.9 million in output. These figures reflect sustained investment across essential utilities and underscore the green transition's contribution to the wider economy.

Speaking at the Baku Energy Forum, Energy Minister Parviz Shahbazov officially announced that Azerbaijan is entering the first full phase of its green energy transformation. Over the next two years, the government plans to commission ten new solar and wind power plants, significantly expanding installed renewable capacity.

“We are expanding our diversification not only in terms of supply sources and routes, but also across different types of energy,” Shahbazov stated. “The initial development phase of green energy will be completed in the next two years.”

Key projects include:

A 240 MW wind power plant set to be fully operational by end-2025;
Three solar power plants totaling 200 MW, with construction starting in 2025;
A pioneering 100 MW floating solar power plant, introducing innovative renewable infrastructure.

The government plans to invest $2.7 billion by 2027, aiming to raise the share of renewables in the national energy mix to 33.7% by 2027, with targets of 38% by 2030 and 42.5% by 2035.

Major projects underway: Scaling up fast

As of mid-2025, at least eight major renewable energy projects are under construction or in advanced planning stages, representing about 2,170 MW of new capacity:

Garadagh Solar (230 MW) – operational since October 2023, cutting 200,000 tonnes of emissions annually
Bilasuvar Solar (445 MW) – under construction, launch by 2026
Neftchala Solar (315 MW) – under construction
Absheron–Garadagh Wind (240 MW) – in development
Khizi–Absheron Wind (240 MW) – full capacity expected by November 2025
bp’s Shafag Solar in Jabrayil (240 MW) – due by 2026
Nobel Energy’s Nakhchivan Solar (400 MW) – phased through 2027
Nobel Energy’s Jabrayil PV Plant (100 MW) – first 50 MW operational by 2027

These developments are strategically placed to serve domestic energy needs while enabling clean energy exports to Europe, reinforcing Azerbaijan’s emerging role as a green energy hub.

To solidify its position as a regional clean energy exporter, Azerbaijan is working with Georgia, Romania, and Hungary to develop the Caspian-Black Sea-Europe Green Energy Corridor—a 1 GW high-voltage direct current (HVDC) interconnector designed to transmit green electricity directly to European grids. This landmark infrastructure project supports EU decarbonization goals and enhances Azerbaijan’s geopolitical leverage in the future energy landscape.

In its second green energy phase (2027–2030), Azerbaijan aims to launch at least 10 additional large-scale projects, contributing an estimated 6 GW in new capacity. This next wave will include offshore wind farms, expanded onshore projects, and integrated energy storage systems. Notably, around 4 GW is expected to be allocated for energy exports, presenting major economic and diplomatic opportunities.

Parallel to wind and solar expansion, Azerbaijan is also strengthening its hydropower portfolio, particularly in Garabagh and Eastern Zangezur. Currently, 32 small hydro plants (270 MW) are operational, with 28 more under construction - further contributing to the country’s renewable energy resilience.

Azerbaijan’s green energy transformation is no longer aspirational - it is underway, measurable, and accelerating. With robust policy direction, strategic international partnerships, and an ambitious project pipeline, the country is positioning itself as a key player in the global energy transition.

As the world turns to cleaner sources of power, Azerbaijan’s ability to balance its legacy as a fossil fuel exporter with its renewable energy ambitions may define its economic and geopolitical identity for decades to come.