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Legislative framework and grid for renewables to be improved in Azerbaijan

17 January 2019 11:50 (UTC+04:00)
Legislative framework and grid for renewables to be improved in Azerbaijan

By Leman Mammadova

Hydrocarbons, which are the traditional source of energy used by the world for many years, are gradually being run out and, thus, make the use of alternative and renewable energy sources urgent.

Renewables are the sources of clean and inexhaustible energy.This includes energy from water, wind, sun, biological waste resources, or even sea waves, with the help of certain facilities.

The favorable geographic location and climatic conditions allow the widespread use of environmentally friendly alternative energy sources in Azerbaijan.

Azerbaijani Ministry of Energy organized an event on "Legislative framework and grid improvement for renewable energy sources in Azerbaijan" which was attended by the representatives of the several state agencies and international experts.

AZERTAC reports that Azerbaijan’s Deputy Energy Minister Samir Valiyev spoke about the measures taken to increase the use of renewable energy sources in the country and stressed the importance of improving the legal framework in this area.

The Norwegian DNV GL will help create a support system and a legal framework in Azerbaijan's alternative energy sector. Recently, the company won the tender of the Ministry of Energy of Azerbaijan and was selected as a consulting company to develop a bill and other legislation.

Chief Consultant of DNV-GL Ilka Lewington made a presentation on the current situation on the expansion and use of renewable energy sources in Azerbaijan. She spoke about the provisions of the draft law, provided information on major support mechanisms, and noted that renewable energy assessments were made.

Wind and solar power potential in Azerbaijan is sufficient and selection of the potential territories and their connection to the grids are the key issues. The areas that have favorable relief for wind and solar stations have already been identified, that is, Nakhchivan (solar energy), the Western region of Khizi and the Absheron Peninsula (wind energy).

Access to selected grids is crucial and proximity of electrical grids, their operational condition and capabilities should be precisely studied for the construction of new stations on renewable energy sources. According to the preliminary results, existing transmission and distribution grids allow the implementation of renewable energy production, integration into the common energy system. However, it is also important to take some measures to strengthen the grid.

At the event, the participants exchanged views on the introduction of guaranteed tariffs for renewable energy sources, rules of conducting auctions, energy purchase and sales contracts, and main technical requirements for their presentation in the Grid Code.

Azerbaijani legal framework must meet interests and expectations of investors. In terms of this, it is important to hold talks with potential investors and familiarize them with the existing potential of Azerbaijan in this area. The interests of investors may be considered in the drafts being prepared and thus, in the coming years, Azerbaijan will implement significant projects in the field of renewable energy sources based on private investments.

Memorandums of cooperation have already been signed with the UAE-based company Masdar, with Turkish company Tekfen and UK's Atkins.

The new draft law on alternative energy sources in Azerbaijan will be ready by May 2019.

Most of Azerbaijan's potential in this sector comes from the solar energy and this potential is estimated at 5,000 megawatts.

Wind power accounts for 4,500 megawatts, biomass for 1,500 megawatts, geothermal energy for 800 megawatts, and small hydropower plants for the remaining 350 megawatts.

The potential of renewable energy sources in Azerbaijan exceeds 25,300 megawatts, which will allow generating 62.8 billion kilowatt hours of electricity annually.

In January-October 2018, hydropower production amounted to 1,528.4 kilowatt hours, solar energy to 35.1 kilowatt hours and wind power to 42.5 kilowatt hours, according to the State Statistics Committee of Azerbaijan.

Aiming to lessen its dependency on oil, Azerbaijan impelments a number of measures for further development of alternative energy sector.

As of December 2018, BP and Azerbaijani Energy Ministry signed a Memorandum of Understanding to jointly explore potential opportunities for the development of renewable energy in the country.

The State Agency for Alternative and Renewable Energy Sources plans to implement 23 projects worth 13 million manats as part of the strategic roadmap for the development of public services in 2018-2020.

The projects cover the construction of 420 megawatt wind, water and biofuel power plants. The capacity of wind power stations will be 350 megawatts, solar power stations will be 50 megawatts, and biofuel power plants will be equal to 20 megawatts.

It is also planned to generate energy from agricultural waste in Azerbaijan.

Moreover, "green" power station is expected to be created at the Baku International Sea Trade Port.

Currently, the State Agency for Alternative and Renewable Energy Sources negotiates with a number of foreign investors to finance projects for wind power plants in the Caspian Sea to develop renewable energy supply.

To this end, negotiations are underway with foreign companies and investors, including companies from China, the UAE, the U.S. and the EU.

It should be noted that earlier Azerbaijani Energy Ministry and Norway's Equinor expressed their intention to cooperate in alternative and renewable energy sources.

The Azerbaijani government is planning to increase the share of alternative energy by 30 percent by 2030 in total power generation.

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