The use of renewable energy sources in Azerbaijan

The wide application of renewable energy sources has been identified as one of the priorities of the energy policy carried out under the leadership of the President of the Republic of Azerbaijan Mr. Ilham Aliyev.

The Presidential Order No. 1209, dated 29 May 2019 on accelerating reforms in the energy sector of the Republic of Azerbaijan formed the legal basis for liberalization, increased competition and the transition to green energy in the energy market. The Law of the Republic of Azerbaijan No 339-VIQ, dated 31 May 2021 on the use of renewable energy sources in the production of electricity acts as an important regulatory framework governing the legal, economic and organizational foundations in this area, as well as support mechanisms for promoting green energy. Furthermore, the transition to green energy, enhancing energy efficiency and establishing low-carbon economy within the Socio-Economic Development Strategy of the Republic of Azerbaijan for 2022-2026 have been set as one of the main targets of national development.

The technical potential of our country's onshore renewable energy sources is 135 GW and offshore is 157 GW. The economic potential of renewable energy sources is estimated at 27 GW, including 3 000 MW of wind energy, 23 000 MW of solar energy, 380 MW of bioenergy potential, 520 MW of mountain rivers.

Power plants with a total capacity of 1829.6 MW operate in our country on renewable energy sources. 65 hydroelectric power plants with a total capacity of 1443.5 MW, 5 wind power plants of 63.5 MW, 9 solar power plants of 278.2 MW, a BIO power plant of 37 MW and 3 hybrid power plants of 7.3 MW are being operated. Renewable energy sources account for about 18.8% of the total energy capacity.

Projects

By 2027, it is planned to implement green energy projects with a total capacity of more than 2 gigawatts. Among these projects, wind and solar plants implemented jointly with local and international partners are of particular importance:

Garadagh Solar Power Plant

On 26 October 2023, within the cooperation with the Masdar (UAE), the 230 MW Garadagh Solar Power Plant was put into operation as a pilot project. The plant was built with foreign investment worth 262 million USD. The plant will produce 500 million kilowatt-hours of electricity annually, saving 110 million cubic meters of natural gas. At the same time, carbon emissions into the atmosphere will be reduced by 200 thousand tons.

Khizi-Absheron Wind Power Plant

Within the cooperation with ACWA Power of Saudi Arabia, it is planned to build Khizi-Absheron Wind Power Plant with a capacity of 240 MW. The plant will produce 1 billion kWh of electricity annually, which will allow saving 220 million cubic meters of natural gas per year and preventing emissions of more than 400 thousand tons of carbon dioxide into the atmosphere.

Shafag Solar Power Plant

The 240 MW Shafag SPP project is being implemented in Jabrayil region in cooperation with bp. Using the virtual power transmission model, the electricity generated at the Shafag SPP will be transmitted to Azerenergy OJSC in Jabrayil, and an equivalent amount of electricity will be transmitted by Azerenergy OJSC to the Sangachal terminal in Baku. This will allow for an approximately 50% reduction in emissions from terminal operations during the future operation of the Sangachal terminal.

The annual average production of Shafag SPP is estimated to be around 500 million kWh. It means that 120-150 million cubic meters of natural gas will be saved annually, and 260-330 thousand tons of CO2 emissions will be reduced.

Mega project

Within the framework of the Mega project implemented by Masdar, solar power plant with a capacity of 445 MW are being built in Bilasuvar region, solar power plant with a capacity of 315 MW in Neftchala region, and wind power plant with a capacity of 240 MW in Absheron and Garadagh regions. On 2 October 2025, the first solar panel was installed at the Bilasuvar SPP.

Gobustan Solar Power Plant

The Gobustan SPP with a capacity of 100 MW is being implemented by the China`s company - Universal International Holdings Limited, which won the auction in 2024. The plant is projected to generate about 260 million kWh of electricity annually. This will save 57 million cubic meters of natural gas and reduce carbon emissions into the atmosphere by 124 thousand tons.

Ufug and Shams solar power plants

On 2 June 2025, within the framework of the initiatives to transform the liberated territories into a green energy zone, implementation contracts were signed at the Baku Energy Week for the Ufug and Shams solar power plants, each with 50 MW capacity, which are planned to be built in Jabrayil district by Nobel Energy.

Floating solar panels project

On July 29, 2024, the opening ceremony of a 100 kW photovoltaic system on Boyukshor Lake was held within the pilot project Knowledge exchange and technical assistance support for the development of floating solar panels system, implemented with the support of the Asian Development Bank. The experimental facility is the first solar power plant in the country to be commissioned over a watershed.

Within the pilot project, it is planned to develop business models and strengthen national potential through trainings in order to promote the participation of the private sector in the installation of solar facilities. Studies are being conducted to implement large-scale projects on water bodies in the future.

Hydrogen

The country report on the Low carbon hydrogen economy market research was prepared by the international consulting company with the support of the European Bank for Reconstruction and Development (EBRD) to assess the production capabilities of green and blue hydrogen types in Azerbaijan, their use in the domestic market, as well as the technical capabilities and economic efficiency of their export.

In the results of the market research, it was suggested that green hydrogen production is economically efficient, as well as export to regional energy markets and application areas for domestic consumption. The report provides information on future steps, areas where green hydrogen can be consumed in the domestic market, the Levelised Cost of Hydrogen (LCOH), export routes and other issues.

Azerbaijan's National Strategic Review for Hydrogen, reflecting a unified approach in the field of low-carbon hydrogen production, was prepared and presented within the COP29 conference. Currently, work is underway on the preparation of a plan for the application of the document.

Green energy zones

On 3 May 2021, the President of the Republic of Azerbaijan Ilham Aliyev signed an order on measures to establish a Green Energy Zone in the liberated territories of the Republic of Azerbaijan. A concept document on the establishment of a Green Energy Zone has been prepared by signing a contract with the Japanese company TEPSCO. At present, the principles of the concept are being applied in these territories.

Solar panels with a total capacity of more than 5 MW have been installed in more than 1500 private houses, public and social buildings in the liberated territories, and the process continues in accordance with the settlement plans. 38 hydroelectric power plants with a capacity of 307 MW are operated in these areas.  Projects of Shafag SPP, Ufug SPP and Shams SPP are being implemented in Jabrayil district.

Within the framework of the State Program on the Socio-Economic Development of the Nakhchivan Autonomous Republic for 2023-2027, a concept and Action Plan for establishing a Green Energy Zone has been prepared. It is currently in the negotiation stage. Agreements were signed with Nobel Energy, TotalEnergies and A-Z Czech Engineering on green energy projects with a total capacity of more than 1000 MW.

Green energy corridors

Caspian-Black Sea- Europe Green Energy Corridor

On 17 December 2022, the Agreement on Strategic Partnership in the Development and Transmission of Green Energy between the Governments of the Republic of Azerbaijan, Georgia, Romania and Hungary was signed in Bucharest. Green Energy Corridor Power Company (GECO Power Company) was established, which will carry out project management with the participation of transmission system operators from four countries. The feasibility study of the project is carried out by the Italian consulting company CESI.

Central Asia-Azerbaijan Green Energy Corridor

As reported, a strategic partnership agreement on the development and transmission of green energy between the Republic of Azerbaijan, the Republic of Kazakhstan and the Republic of Uzbekistan was signed by the leaders of the three countries on 13 November 2024 within the COP29. To implement the agreement, on 27 December of the same year, Azerenergy OJSC, Kazakhstan Electricity Grid Operating Company and National Power Grid of Uzbekistan OJSC established a joint venture named Green Corridor Union. A Memorandum of Understanding on the project was signed between the ministries of energy of the three countries and the Asian Development Bank and the Asian Infrastructure Investment Bank.

Azerbaijan-Türkiye-Europe Green Energy Corridor

Signing of Memorandum of Understanding on cooperation between the Ministry of Energy of the Republic of Azerbaijan and the Ministry of Energy and Natural Resources of the Republic of Türkiye in the field of transmission of electricity generated from renewable energy sources in the Republic of Azerbaijan and in the Republic of Türkiye.

Work is underway to integrate the Azerbaijani and Turkish energy infrastructures and export electricity through Nakhchivan. Along with the export of 1GW of renewable energy from Nakhchivan, the corridor to be established has the potential of transmitting electricity from the Caspian and Central Asia to Türkiye and Europe.

With this regard, Jabrayil substation with a capacity of 330/110/10 kilovolt 2x250 MVA was put into operation to establish Jabrayil energy hub. It is planned to install a 330kV electric power transmission line connecting Jabrayil energy hub and Nakhchivan via the Zangezur corridor passing through Armenia or Iran and to build a 330kV substation in Nakhchivan.

Azerbaijan-Georgia-Türkiye-Bulgaria Green Energy Corridor

Memorandum of Understanding on cooperation in the field of green electricity transmission and trade was signed between the Ministry of Energy of the Republic of Azerbaijan, the Ministry of Economy and Sustainable Development of Georgia, the Ministry of Energy and Natural Resources of the Republic of Türkiye and the Ministry of Energy of the Republic of Bulgaria on 4 April 2025.

Climate targets and COP29

In our country, a voluntary commitment to reduce emissions by 2050 by 40% has been adopted. In order to meet this commitment, by 2030, it is aimed to increase the investment capacity in renewable energy in the total energy mix to at least 30%.

The Energy Minister expressed Azerbaijan's support for the joint initiative Global Promise on Renewable Energy and Energy Efficiency to triple and double energy efficiency of renewable energy potential in the world by 2030.

Three important energy initiatives – COP29 Global Energy Storage and Grids Pledge, the COP29 Green Energy Pledge: Green Energy Zones and Corridors, and the COP29 Hydrogen Declaration were officially presented at the COP29 event.

COP29 Global Energy Storage and Grids Pledge has committed to supporting the delivery of and ambitious scale-up to 1,500 GW of energy storage globally by 2030. The Pledge also includes a commitment to add or refurbish 25 million kilometres of grids globally by 2030, recognising the need to add or refurbish an additional 65 million kilometres by 2040. As part of the COP29 Green Energy Pledge: Green Energy Zones and Corridors, it is planned to create Intercontinental and interregional green energy zones. The COP29 Hydrogen Declaration, on the other hand, calls for strengthening global efforts to increase pure hydrogen production, reducing carbon emissions in existing hydrogen production to zero.