Azerbaijan Invests $2 Billion in Renewable Energy Ahead of COP29

Azerbaijan has announced a massive investment of over $2 billion to develop renewable energy sources, aiming to increase their share in the energy sector.

This move comes ahead of Baku hosting COP29 in November, a crucial event for global climate commitments. Currently, Azerbaijan holds approximately 2.5 trillion cubic meters of natural gas reserves, according to BP’s 2021 statistical review.

The country plans to double its gas exports to Europe by 2027. However, while natural gas emissions are lower than coal or oil, they remain significantly higher than green energy sources.

In a recent speech, Energy Minister Parviz Shahbazov stated that the country intends to increase the installed capacity of renewable energy to nearly 2 gigawatts by 2027, raising their share to 33%.

Currently, this share stands at 20.86%, with only 8.5% of electricity produced in the first quarter of 2024 coming from renewable sources. To achieve these goals, Azerbaijan is focusing on developing wind and solar projects, as well as constructing an undersea power cable in the Black Sea to transfer green energy from future Caspian Sea wind farms to Europe.

According to Shahbazov, investments in renewable energy will enable the production of 5.3 billion kilowatt-hours of electricity, saving 1.2 billion cubic meters of gas and reducing CO2 emissions by 2.5 million tons.

These measures are crucial for improving the country’s environmental footprint and supporting its international sustainable development ambitions. Nevertheless, Azerbaijan does not plan to abandon fossil fuels.

Despite a global decline in fossil fuel financing and the absence of long-term demand guarantees, the country remains committed to supplying gas to its partners, Shahbazov added.

The challenges of energy transition in Azerbaijan are multifaceted. By increasing the share of renewable energy, the country can reduce its dependence on fossil fuels and improve its environmental reputation on the international stage.

However, balancing sustainable development ambitions with economic realities remains a major challenge. Azerbaijan’s efforts to diversify its energy mix could serve as a model for other fossil fuel-rich countries, demonstrating that strategic investments in renewable energy can support a greener and more sustainable energy transition.

Azerbaijan’s initiative to develop renewable energy is a significant step towards reducing emissions and improving its environmental footprint. These investments, if realized as planned, could transform the country’s energy landscape and strengthen its position before COP29.

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