Azerbaijan's New Green Power: Contribution To Domestic Market And Regional Prospects

(MENAFN- Trend News Agency) BAKU, Azerbaijan, January 8.​ The official opening ceremony of the Khizi–Absheron Wind Power Plant, with an installed capacity of 240 MW, built by ACWA Power, a Saudi Arabian company, was held today in Azerbaijan. The launch of this facility marks not only another step forward in the development of the national energy system but also a significant sign of Azerbaijan's shift into one of the key hubs of green energy in the region.

The plant was constructed on 14.2 hectares of land in the Absheron district and 22.6 hectares in Khizi, totaling approximately 37 hectares designated for renewable energy sources. The project includes 37 wind turbines, each with a capacity of 6.5 MW, 12 in Absheron and 25 in Khizi. In addition, measuring and monitoring stations as well as modern bird protection systems have been installed, ensuring the project adheres to international environmental standards.

The total foreign investment in the project amounted to around $340 million. It's expected that the plant will generate approximately 1 billion kWh of electricity annually, saving up to 220 million cubic meters of natural gas per year and preventing the emission of more than 400,000 tons of carbon dioxide. The general contractor for the project was Power China Huadong Engineering Co., Ltd., a subsidiary of the Chinese Power China Group.

The green light for the Khizi-Absheron wind farm is a game changer for the country's energy landscape. First, the project contributes to the diversification of energy generation and reduces the domestic energy balance's dependence on fossil fuels. The natural gas saved from wind generation can be redirected for export, particularly to European markets, strengthening Azerbaijan's role as a reliable energy supplier amid growing demand and increasing focus on Europe's energy security.

Secondly, the plant enhances the resilience of the national energy system by creating a balance between traditional and renewable generation. This is especially important given the country's strategic course to develop both sectors simultaneously, as repeatedly emphasized at the highest state level.

The executive agreement between Azerbaijan's Ministry of Energy and ACWA Power was signed on January 9, 2020. On December 30 of the same year, the parties concluded the Investment Agreement, Power Purchase Agreement, and Grid Connection Agreement, involving the Azerenergy OJSC. The foundation stone for the plant was laid in January 2022, and today's launch is the logical result of a consistent and predictable investment policy.

ACWA Power is a major player in the renewable energy market. The company is one of the leading private developers, investors, and operators of energy and water projects globally. As of February 2025, ACWA Power's portfolio includes 101 projects in electricity generation and water desalination at various stages, with a combined value of around $107.5 billion.

President of the Republic of Azerbaijan Ilham Aliyev said during his speech at the opening ceremony of the wind power plant that this is the first renewable power plant built by ACWA Power in Azerbaijan, but not the last one.

"The company has bigger plans, and the government of Azerbaijan fully supports these plans," the head of state said.

ACWA Power's projects in Azerbaijan extend far beyond a single wind farm. In May 2024, the company and Azerbaijan's Ministry of Energy signed an agreement to implement a 200 MW Battery Energy Storage System (BESS) project. This project is the bread and butter for weaving renewable sources into the energy tapestry, as it allows for better management of generation fluctuations, supports stable connections with neighboring energy systems, and minimizes electricity losses.

Furthermore, in September 2025, Azerbaijan and ACWA Power signed a partnership agreement for the construction of a seawater desalination plant on the Caspian Sea. The project includes design, construction, financing, operation, and maintenance phases and will be implemented in a public-private partnership format for 25 years. It aims to effectively manage water resources and improve water supply levels for the population.

Additionally, Azerbaijan's Amelioration Scientific Research Institute and ACWA Power signed a memorandum of understanding on knowledge and experience exchange in water and land resources, underscoring the long-term and comprehensive nature of the cooperation.

Regarding the country's renewable energy potential, President Ilham Aliyev stated that over the past 20 years, the generation capacities created in our country have increased by about three times compared to the entire previous period.

"Today, our generation capacity constitutes approximately 10,000 megawatts. This, if we may say so, is a historical record. However, given that many new renewable energy generation capacities will be put in place in the coming years, this figure will certainly increase and will enable us to both meet the growing domestic demand adequately and export electricity in larger volumes," the head of state noted.

The technical potential of renewable energy sources in the country is estimated at 135 GW on land and 157 GW at sea. Karabakh, Eastern Zangezur, and the Nakhchivan Autonomous Republic have been declared green energy zones, where the total renewable energy potential reaches 20 GW.

It's projected that the share of renewable energy in electricity production will reach 25% by 2027 and 30% by 2030. The first phase, by the end of 2027, will see about two GW of capacity introduced, with more than six GW in subsequent years. Initially, priority will be given to domestic consumption, with a focus on electricity exports and powering data centers in later phases.

The development of renewable energy in Azerbaijan is closely linked to the formation of international green energy corridors, including routes from the Caspian Sea to the Black Sea to Europe, Central Asia to Azerbaijan, Azerbaijan to Türkiye to Europe, and Azerbaijan to Türkiye to Georgia to Bulgaria. These projects put the country on the map as a go-to spot for clean energy transit and exports, really turning the tide in the energy game.

The commissioning of the Khizi-Absheron wind farm clearly demonstrates that Azerbaijan is moving from isolated projects to a systematic development of renewable energy. The country is not just building up its own energy security but also laying down a stable groundwork for energy exports and bringing in long-term foreign investments.

The mix of strategic planning, international teamwork, and big infrastructure projects helps Azerbaijan to firmly establish itself as one of the main players in the region's green energy scene.

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