Azerbaijan, Central Asian nations join forces for green economy development

Azerbaijan and the Central Asian nations have established a robust collaborative framework across various economic sectors. As an active participant in the "green transition" initiative, Azerbaijan has emerged as a key proponent of projects aimed at the production and export of renewable energy within the region.

In a significant development, Azerbaijan, Kazakhstan, and Uzbekistan have formalized their cooperation with the adoption of a pivotal document concerning the export of "green energy." During a recent meeting of the relevant ministry heads from these three countries, a Joint Communiqué was signed. This document outlines the collaborative efforts in energy exchange with a focus on renewable energy sources, including the export of "green energy."

On August 6, Azerbaijan will engage in the inaugural meeting of energy ministers from Central Asian countries in Astana. The meeting will be chaired by Kazakhstan's Energy Minister, Almasadam Satkaliyev. At the upcoming meeting, the energy ministers of Kazakhstan, Kyrgyzstan, Tajikistan, Turkmenistan, and Uzbekistan, along with the Deputy Energy Minister of Azerbaijan, are scheduled to address the assembly.

It is noteworthy that during the tripartite meeting held in November of the previous year at the Ministry of Economy in Baku, discussions centered on the potential export of electricity from Central Asian countries to Europe via Azerbaijan. The participating parties reached an agreement to establish a joint venture focused on electricity export and to commence preparations for the project's economic feasibility.

The meeting, which included the ministers of economy and energy from Azerbaijan, Uzbekistan, and Kazakhstan, highlighted that the renewable energy development and export policies of these three countries enable Azerbaijan to serve as a conduit for delivering electricity from Central Asia to Europe.

In this context, Azerbaijan, in collaboration with Georgia, Romania, and Hungary, is advancing the development of the Caspian Sea-Black Sea-Europe energy corridor, designed to facilitate the export of 4 GW of electricity. Additionally, plans are underway to transport another 1 GW of "green energy" via the Nakhchivan-Turkiye-Europe route.

The integration of Kazakhstan and Uzbekistan into these corridors will bolster their cooperation in electricity market development, as well as in the production and supply of "green hydrogen" and ammonia. Azerbaijan's initiative to coordinate and synchronize efforts for the future development of the regional energy system, as well as to foster collaboration on the supply of clean electricity to international markets, is highly commendable.

During the recent meeting, the ministers acknowledged the substantial renewable energy potential of their respective countries. They expressed their willingness to participate in the project aimed at exporting electricity from alternative sources to Europe and signed a Joint Communiqué as a result of their discussions.

One month following this event, a Joint Communiqué was adopted in Baku during a tripartite meeting between Azerbaijan, Uzbekistan, and Kazakhstan. This document addressed the prospects of exporting electricity from Central Asia to Europe via Azerbaijan, covering aspects such as energy exchange focused on renewable sources, the development and export of "green hydrogen" and "green ammonia," and the creation of necessary infrastructure.

The agreement outlined in the Communiqué included the establishment of a joint venture for electricity export and preparation for the project's economic justification. It also specified that other regional countries could join the project. The ministers reiterated their countries' potential in renewable energy and reaffirmed their readiness to contribute to the export of electricity from alternative sources to Europe.

Azerbaijan's renewable energy resources include a technical potential of 135 GW on land and 157 GW offshore. The economic potential is estimated at 27 GW, comprising 3,000 MW from wind energy, 23,000 MW from solar energy, 380 MW from bioenergy, and 520 MW from mountain river sources.

Furthermore, Azerbaijan's renewable energy production policy is guided by the "Azerbaijan 2030: National Priorities of Socio-Economic Development," adopted in February 2021. Among the five national priorities outlined, a clean environment and "green growth" are pivotal, setting ambitious new goals. Azerbaijan is making significant progress toward these goals and remains open to further cooperation.

Considering the potential for new cooperation through joint projects with Central Asian countries, it is evident that Kazakhstan is advancing towards its "green goals."

In 2013, Kazakhstan approved the “National Concept for Transition to a Green Economy up to 2050,” which set forth the principles of a green economy as a strategic development path. The concept aims to increase the share of renewable energy in electricity generation from zero to 3 percent by 2020, and further to 30 percent by 2030 and 50 percent by 2050.

These targets are particularly ambitious given Kazakhstan's unique context. As the 14th-largest emitter of greenhouse gases, the country had previously relied mainly on a few Soviet-era hydropower plants for its renewable energy needs. Kazakhstan faces significant climatic extremes, with summer temperatures in the capital, Astana, exceeding 40 degrees Celsius and winter temperatures dropping below -40 degrees Celsius. Addressing these extremes necessitates substantial energy consumption for both heating and cooling.

To tackle its energy challenges and reduce emissions, Kazakhstan's policy now focuses on developing a more decentralized, balanced, and environmentally friendly energy supply system that leverages a variety of renewable resources. This approach not only acknowledges the country’s substantial fossil fuel reserves but also capitalizes on its favorable conditions for renewable energy development.

Collaboration among countries with shared objectives in renewable energy holds significant promise for unlocking new opportunities. The development of the "Green Energy" transmission project is poised to enhance economic and energy connections among the participating nations, providing a new impetus to their national energy sectors.

Azerbaijan's potential for collaboration in the renewable energy sector extends notably to Tajikistan. Dilshod Sharifi, head of the International Economic Cooperation Department at the Ministry of Economic Development and Trade of Tajikistan, highlighted the potential for joint projects involving hydropower.

"Tajikistan's substantial water resources and hydropower potential could benefit from Azerbaijani investment and technology, improving the efficiency of water resource utilization. Both countries enjoy high levels of solar radiation, making them ideal candidates for solar energy projects. Collaborative efforts could include the establishment of solar parks, installation of solar panels, and the creation of joint research centers focused on "green technologies,"he added. These initiatives would help reduce reliance on fossil fuels and lower greenhouse gas emissions.

Turning to Turkmenistan, where up to 70 percent of the territory is desert, there is significant potential for solar energy production. Despite the challenges posed by its desert landscape, Turkmenistan's solar energy potential is complemented by wind energy resources. The UAE’s "Masdar" company, which has invested in Azerbaijan, is also set to develop "green energy" projects in Turkmenistan. Given the high solar exposure—300 sunny days annually—Turkmenistan's potential for solar energy is substantial, despite the high costs associated with green energy production, infrastructure construction, and energy transmission.

In Azerbaijan, the collaboration with Masdar has already yielded progress. The Garadagh Solar Power Plant, which began operations last year, represents the first foreign-invested energy project in Azerbaijan. Additionally, foundations have been laid for the Neftchala and Bilasuvar Solar Power Stations, as well as the Absheron-Garadagh Wind Power Station, with a combined installed capacity of 1000 MW.

Kyrgyzstan also presents opportunities for enhanced renewable energy cooperation. During the 16th Economic Cooperation Organization (ECO) summit in Tashkent last November, Kyrgyz President Sadyr Japarov emphasized the importance of leveraging the ECO member countries' potential for renewable energy development. He called for focused efforts on developing effective mechanisms for the economic advancement of member states, with renewable energy as a key area.

Moreover, during President Japarov's state visit to Azerbaijan in April this year, 18 agreements were signed, including a "Memorandum of Understanding on Cooperation in the Field of Energy" between Azerbaijan's Ministry of Energy and Kyrgyzstan's Ministry of Energy. This memorandum opens up significant prospects for deepening energy cooperation between the two nations.

Azerbaijan's proactive role in fostering renewable energy partnerships with Central Asian countries underscores its commitment to a sustainable future. By spearheading the development of key energy projects and signing pivotal agreements with Kazakhstan, Uzbekistan, Tajikistan, Turkmenistan, and Kyrgyzstan, Azerbaijan is establishing itself as a central player in the regional green energy landscape.

The collaborative efforts, including the advancement of the "green energy" transmission project and various bilateral agreements, are set to enhance energy connections, drive economic growth, and support the global transition to cleaner energy sources. As these nations work together to leverage their renewable resources, they pave the way for a more sustainable and interconnected energy future.