Azerbaijan has potential to install 7GW of offshore wind power by 2040 according to a new roadmap released today by the Ministry of Energy of the Republic of Azerbaijan, the World Bank and the International Finance Corporation (IFC).
The roadmap states that this can be achieved with the right long-term vision, infrastructure development, investment, and policies – which could play an important role in achieving the country’s parallel priorities of decarbonisation and sustainable growth.
The first-of-its-kind Offshore Wind Roadmap for Azerbaijan provides strategic vision under low growth and high growth scenarios.
This aims to support in making decisions about regulations, frameworks, and infrastructure related to this new industry at a time when interest in developing offshore wind globally is increasing.
Analysis of the low growth scenario envisions a moderate expansion of offshore wind resulting in 1.5GW of fixed foundation offshore wind by 2040, making up 7% of the country’s electricity supply under a decarbonization scenario.
The high growth scenario outlines a more ambitious expansion with 7.2GW of offshore wind by 2040, making up 37% of its electricity supply.
This will result in more energy, more jobs, faster pay-back and more carbon dioxide avoided compared to the low growth scenario due to the increased cost reduction delivered by a larger market, but significant and early action need to be taken for this to happen, according to the roadmap.
Both scenarios would only be tapping into a fraction of the vast technical potential for offshore wind resource in the country.
The roadmap sets out the recommended actions to be taken in order to realize the offshore wind potential under both scenarios.
These recommendations include setting targets for 2030 and 2036, developing and competitively bidding a 200MW demonstration project.
This should be followed by larger projects, further exploring potential offshore wind development zones, modernising infrastructure, adopting international best practices to attract financing, educating all government agencies and the future workforce to build the knowledge and capacity needed to deliver a pipeline of offshore wind projects.
Deputy Minister of Energy for the Republic of Azerbaijan said Elnur Soltanov said: “Over the past few decades, Azerbaijan has effectively leveraged our oil and gas resources in the Caspian Sea for the benefit of our country’s economic development.
“But the world is changing, and it is time to tap into a new resource in our seas – the power of offshore wind.
“Offshore wind offers our country a unique opportunity to transfer our oil & gas expertise and workforce to a new sector that can simultaneously help us achieve our goals of decarbonization and economic diversification to pave the way to a prosperous future for Azerbaijanis.”
The World Bank country manager for Azerbaijan, Europe, and Central Asia Sarah G Michael added that offshore wind offers Azerbaijan a local, competitively priced, large scale, clean source of energy and long-term jobs.
She said: “Our analysis of the high growth scenario suggests that offshore wind power could create thousands of jobs by 2040, as well as provide billions in local gross value added to the economy in Azerbaijan – all while avoiding millions of tons in carbon emissions.
“Further analysis shows offshore wind will play a significant role in reaching net zero emissions in Azerbaijan’s power sector – a key priority for the country as highlighted in the Azerbaijan 2030 National Priorities.”
IFC regional manager for the South Caucasus Ivana Fernandes Duarte said that this roadmap was an important milestone in IFC’s collaboration between the Government of Azerbaijan to deploy offshore wind as part of the country’s wider decarbonization strategy.
She said: “We at IFC are proud of our excellent collaboration with the government of Azerbaijan.
“We look forward to supporting the country in its journey towards renewable energy deployment that can create new economic growth opportunities in the country, by providing both the advisory services and financing to support private sector investment in this sector.”
The roadmap is one of a series of offshore wind roadmap studies commissioned by the WBG under the joint Energy Sector Management Assistance Program-International Finance Corporation (ESMAP-IFC) Offshore Wind Development Program.
Funding for this study was provided by the Energy Sector Management Assistance Program (ESMAP) and PROBLUE.
The roadmap was produced, under contract to the World Bank, by BVG Associates in association with Kent, and Encotec, and with the input of The Biodiversity Consultancy.
It was prepared with the consultation of stakeholders from a wide range of public and private representatives from across the local the global offshore wind industry.