Japanese company strives to invest in renewable energy projects

19 June 2019 15:15 (UTC+04:00)

By Leman Mammadova

Japan has contributed to the development of oil sector in Azerbaijan, and presently intends to develop cooperation with Azerbaijan in alternative energy.

Japan's Mitsui company is interested in investing in projects for the development of renewable energy sources in Azerbaijan, Vice President of the company Kenichi Mochida said at a meeting with Samir Valiyev, Deputy Energy Minister of Azerbaijan, on June 19, in Baku.

The parties signed a memorandum of understanding on renewable energy cooperation, which envisages cooperation and assessment of potential for investment in renewable energy projects in Azerbaijan.

According to the document, key factors will be identified and developed in order to create a legal framework for the promotion of investment in cost effective renewable energy projects in Azerbaijan.

Valiyev noted that cooperation with Mitsui will contribute to the development of renewable energy sources in the country and the implementation of joint projects.

Mochida regarded the document as an example of Azerbaijani-Japanese cooperation in the field of renewable energy.

In his words, the company intends to invest in renewable energy, in particular, in the development of wind energy projects in Azerbaijan.

The vice president also gave information on the projects of wind, water, heat, solar, gas, and coal power plants implemented by Mitsui in Brazil, Japan, Australia and other countries.

The parties also discussed the main goals and directions of future cooperation.

Presently, Azerbaijan implements 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.

Today, the share of electricity generation from alternative energy sources in Azerbaijan stands at 18 percent, the largest part of which accounts for hydroenergy.

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.

Diplomatic relations between Azerbaijan and Japan were established in 1992. Relations between the two countries have continued to develop steadily. A number of important projects are being implemented in Azerbaijan through the financial support of Japan.‚Äč

Today, Japan-Azerbaijan energy relations are mainly focused on the oil field.

Japan was one of the first countries to support Azerbaijan's forward-looking oil strategy. Two major Japanese companies Itochu and Impex are involved in the Contract of the Century, a large-scale international contract dated September 20, 1994, on the joint development of three oil fields - Azeri, Chirag and Gunashli in the Azerbaijani sector of the Caspian Sea,.

These companies will operate in Azerbaijan at least until 2050 within the modified and redeveloped agreement on joint development and shared distribution of production from the Azeri, Chirag fields and the deepwater part of the Gunashli field, signed in 2017.

In addition, leaders of Japanese business – Mitsui, Mitsubishi, Marubeni, and Sojits – are involved in energy and infrastructure projects in Azerbaijan.

Meanwhile, construction of "North" electricity and "North-2" gas-steam power stations in Azerbaijan is implemented through the loan provided by Japanese government.


Leman Mammadova is AzerNews’ staff journalist, follow her on Twitter: @leman_888

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