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Alternative for traditional energy market

17 April 2015 16:52 (UTC+04:00)
Alternative for traditional energy market

By Nigar Orujova

Since nations' hunger for cheap and reliable energy is only set to increase on the back of economic progress and population growth it is only natural for countries, whether rich or poor, to be looking for new alternative energy market.

Since energy is soundly tied up to economic growth and stability, governments need safe and reliable sources of energy to sustain their policies.

Azerbaijan is that aspect a natural contender on the world's energy market. Rich in natural resources, Azerbaijan can offer its energy partners stability and reliability.

The Land of Fire is actually the perfect alternative when it comes to renewable energy. Benefiting from strong winds and a sunny disposition, Azerbaijan marries natural potentials and funds.

The total potential of alternative and renewable energy sources in the country exceeds 12,000 megawatts. Most of the country's capacity in this area accounts for solar energy, and this potential is estimated to stand at 5,000 megawatts. Wind energy is not far behind with 4,500 megawatts.

Despite the fact, that solar power is most profitable compared to other alternative resources in Azerbaijan now, the difference between solar and wind energy is not drastic. Moreover, new wind projects may soon eliminate this distinction.

Being the first country to have built a seaside oil platform 66 years ago, Azerbaijan is preparing today to build the world's first sea-based wind power plant in the area of oil production.

Akim Badalov, the head of the State Agency on Alternative and Renewable Energy Sources, said on April 16, that the wind plant with a capacity of 200 megawatts will be built on trestles in the Caspian Sea.

"This project is similar to “the Oil Rocks” [a town in the open sea in Baku], which became the world's first of its kind. The plant will be built near the island Pirallahi. Moreover, the project presuppose the construction of a road between Chilov and Pirallahi islands," Badalov said.

Azerbaijan’s state energy company SOCAR that has the necessary technology and resources will construct the flyovers.

"Currently, a feasibility study for the project is completing, and it will be submitted to the Cabinet of Ministers. The project is estimated at 450-500 million manats. It’s payback period will stretch over 10 years," said Badalov.

The three-staged project includes the construction of the station, the road and the distribution facilities. The full development of the project is expected in 2017-2018. Realization will take some 2.5-3 years.

Such projects are usually estimated at 900 million - a billion dollars in the world, he said. “However, due to the use of wind energy, we can halve the cost of the project."

The funds will be drawn at the expense of export credits. Investors from Germany, China and Arab countries have already expressed interest in the project, Badalov stressed. The project is developed in collaboration with international experts.

“The successful implementation of this project will, in future, make possible to present a similar model to the world,” he stressed.

Azerbaijan, the country, that has the highest potential of renewable energy sources in the region, is keen to use it with high investments. Last year, the country spent 63.6 million manats in the development of renewable energy projects.

In total, since 2000 the country invested about 800 million manats in the industry.

However, the alternative energy sector is still a newly developing industry in the country.

Currently, the share of alternative energy sources in Azerbaijan is less than 1 percent, and accounts for small hydro power plants.

The share is planned to increase to 20 percent of the total volume of energy consumption in Azerbaijan by 2020, which requires 7 billion manats ($8.9 billion) of investment.

The increase of alternative energy capacity will reduce the use of hydrocarbons in the country. This will make possible to redirect them to overseas markets, increasing the export potential of the country and its revenues.

In pursuit of energy sources, people should not forget the environment. The usage of renewable energy will significantly reduce emissions and thus protect nature.


Nigar Orujova is AzerNews’s staff journalist, follow her on Twitter: @o_nigar

Follow us on Twitter @AzerNewsAz

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