By Leman Mammadova
The United Arab Emirates (UAE) is interested in expanding cooperation with Azerbaijan in energy sector, particularly in the development of renewables.
Azerbaijani Minister of Energy Parviz Shahbazov has met with the UAE delegation led by Sheikh Ahmed Dalmook Al Maktoum.
At the meeting, head of the UAE delegation expressed interest in cooperation in the energy sphere. He also talked about the participation as an investor in renewable energy, reduction of costs and achieving efficiency in electricity production from gas and renewable energy sources, as well as the cooperation prospects with Azerbaijan’s State Oil Company SOCAR.
Shahbazov, in turn, stressed that relations between Azerbaijan and the UAE are at a high level in many spheres and there is a potential for their development in the energy sector.
The minister noted that during the OPEC+ ministerial meeting in Baku, talks were held with the UAE and Industry Minister Suhail bin Mohammed Faraj Al Mazroui.
"As a result of these negotiations, discussions have been initiated with UAE’s Mubadala company,” Shahbazov said. “The Azerbaijani side also cooperates with UAE’s Masdar company in the field of alternative energy.”
The minister further spoke about the complex measures being taken in the field of alternative energy, favorable conditions created for investors in Azerbaijan, as well as relevant projects. He invited the UAE businessmen to participate in the energy sector of Azerbaijan.
The diplomatic relations between Azerbaijan and the UAE were established in 1992. The two countries enjoy good opportunities for mutual investments, joint implementation of various projects, including agricultural sector, as well as for the creation of joint ventures, especially in tourism sector.
UAE invested $2.1 billion in Azerbaijan, of which $1.3 billion was put in the oil sector, and $806 million - in the non-oil sector of the country. Azerbaijan, in turn, invested $330 million in the UAE.
At present, about 300 UAE companies operate in Azerbaijan.
Trade turnover between two countries amounted to $54 million in 2018. UAE exported goods worth $32 million to Azerbaijan, while Azerbaijani exports to the UAE reached $22 million.
Azerbaijan mainly imports high-tech products, electronics, industrial goods and building materials from the UAE and exports fruits, juices, nuts, metal semi-finished products, etc to the country.
Presently, Azerbaijan carries out a number of measures for further development of alternative energy sector, aimed at reduction of its dependency on oil and gas. The favorable geographic location and climatic conditions allow the widespread use of environmentally friendly alternative energy sources in Azerbaijan.
At present, 18 percent of electricity production in Azerbaijan accounts for alternative energy sources, of which hydro power plants hold main share. Wind power maintains 59.2 percent (15,000 MW) share in the total potential for renewable energy, followed by solar power - 31.6 percent (8,000 MW), biomass power - 3.5 percent (900 MW), geothermal power - 3.1 percent (800 MW), and hydropower - 2.6 percent (650 MW).
There are plans to implement a number of projects totaling $2.3 billion in alternative energy. The projects include construction of a plant for biofuels (pellet fuels) production in the Sabirabad region, construction of wind power plants in the Pirallahi district, an agro-energy residential complex in the Samukh region, etc.
Construction of two wind power farms worth $800 million and $408.9 million in the Pirallahi district, as well as a wind power farm worth $377.7 million in the Khizi region are the biggest projects planned for implementation.
According to the Market Analysis Azerbaijan 2019, expansion of renewable electricity generation is estimated at 430 MW in 2018-2020, 840 MW in 2021-2025, and 925 MW in 2026-2030. The share of renewables in the total power generation is expected to be 15 percent by 2020, 25-30 percent by 2025 and 35-40 percent by 2030.
Leman Mammadova is AzerNews’ staff journalist, follow her on Twitter: @leman_888
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