(MENAFN- Trend News Agency) BAKU, Azerbaijan, April 4. The partnershipbetween Azerbaijan and Saudi Arabia has entered a new phase, withthe green energy sector acting as a key driver of thiscooperation.
During the Fourth Industrial Revolution, two countries, bothrich in hydrocarbons, are collaborating to transition to cleanenergy. This serves as a prime example of effective collaborationto achieve global goals.
Azerbaijan, a dependable oil and gas supplier to global markets,and Saudi Arabia, a leader in the Muslim-Arab world, an OPECmember, and a G20 participant, are joining forces on large-scaleclean energy projects. They're not stopping there; they plan tofurther expand their cooperation in this field.
For instance, on January 13, 2022, the Ministry of Energy ofAzerbaijan and Saudi Arabia's ACWA Power signed a memorandum ofunderstanding for cooperation in wind energy on the CaspianSea.
ACWA Power, a globally recognized company, has a renewableenergy production capacity of 8,000 MW and an overall investmentcapacity of 30,200 MW in the electricity sector, with an investmentportfolio totaling $45 billion.
ACWA Power will oversee the construction of the 240 MWKhizi-Absheron wind power plant, with a project budget of $300million, marking the largest investment by the Saudi companyoutside its home country.
Thanks to the electricity generated by the plant, 220 millioncubic meters of natural gas will be saved, and 400,000 tons ofcarbon dioxide emissions will be avoided. The groundbreakingceremony for the wind farm took place on January 13, 2022. Theproject will see the installation of 40 turbines, each with acapacity of 6 MW. Seventeen turbines will be set up in thePirakashkul village of the Absheron district, and 23 turbines willbe installed in the Sitalchay village of the Khizi district. Theproject is being carried out under a build-own-operate model. ACWAPower and the Azerbaijani government have agreed to expedite theproject. Transmission lines in the designated area have alreadybeen constructed, and the first turbines could arrive as early asApril 2024. More staff will be involved than initially planned,which will accelerate the implementation of several technicalaspects of the project. This acceleration could lead to the windfarm being operational by 2025.
The project is receiving strong support from internationalfinancial institutions. In October 2023, the European Bank forReconstruction and Development (EBRD) arranged a syndicated loan of$197.1 million (186.9 million euros) for ACWA Power AzerbaijanRenewable Energy, a subsidiary of ACWA Power. The project is alsobeing co-financed by the OPEC Fund for International Development December 2023, the OPEC Fund approved a $50 million loan to ACWAPower Wind for the construction of the Khizi-Absheron wind powerplant.
In addition to the Khizi-Absheron wind farm, ACWA Power hassigned a memorandum of understanding with the Ministry of Energy ofAzerbaijan to explore the construction of a 1 GW onshore wind powerplant, a 1.5 GW offshore wind power plant, and the implementationof hydrogen projects in the country.
ACWA Power is also one of two companies that respondedpositively to the Azerbaijani government's proposal to create agreen energy zone in Karabakh and Eastern Zangazur. The company hasexpressed its intention to build wind and solar power plants inthese territories in the next stage. These projects represent asignificant contribution to Azerbaijan's goal of becoming a greengrowth country and a supplier of green energy. The collaborationbetween Azerbaijan and ACWA Power is crucial not only for providingnew capacities for the planned green energy corridor from theCaspian to Europe but also for reducing carbon emissions andaccelerating the energy transition.
Beyond energy, the cooperation between the two countries extendsto other sectors as well. Trade between Azerbaijan and Saudi Arabiaamounted to $30.8 million in 2023, showing a 36.3 percent growthcompared to 2022. However, these figures do not fully reflect theenormous potential for further development of bilateral economicrelations.
This cooperation underscores the potential for future relationsbetween Azerbaijan and Saudi Arabia, with green energy serving as akey driver that will likely impact various other sectors aswell.
Saudi Arabia is dedicated to collaborating with Azerbaijan inthe process of the new energy transition, and Baku deeply valuesthis commitment.
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