As Azerbaijan seeks to diversify its economy, measures to create an efficient and sustainable energy system has become a top priority. A renewable-based energy system would offer socio-economic benefits, help to introduce innovative technologies, and provide viable low-carbon solutions to meet national climate targets.
This Renewables Readiness Assessment (RRA) highlights potential improvements to Azerbaijan’s legal and regulatory framework, as well as financing options for renewables. Despite current reliance on oil and gas, the country has excellent wind and solar resources, along with significant prospects for biomass, geothermal and hydropower development.
The Ministry of Energy of Azerbaijan undertook this study in collaboration with the International Renewable Energy Agency (IRENA) to lay the foundations for renewable energy investment going forward.
- Adopt a renewable energy law
- Streamline permitting procedures for renewable energy
- Enhance the procurement process for renewable energy
- Set up dedicated financing mechanisms to address off-taker risk
- Implement a standard power purchasing agreement (PPA) format
- Conduct long-term planning for variable renewable energy (i.e. solar and wind) sources
- Design and implement a grid connection code with standards for solar and wind integration
- Develop a capacity building strategy and raise awareness
- Adopt a long-term renewable energy target
The recommendations were discussed at a meeting with representatives of the Ministry of Energy, government agencies, international organisations and experts. The head of administration at the Ministry of Energy, Zaur Mammadov, noted the effective co-operation between Azerbaijan and IRENA, citing this project as a successful result that would have a positive impact on the development of the country.