Baku, Azerbaijan, March 19
By Farhad Daneshvar - Trend:
An official with the Asian Development Bank Institute (ADBI) has advised Energy Ministry of Azerbaijan to use both, foreign and national currencies, in its feed-in tariff system in order to reduce possible risks.
Dr. Farhad Taghizadeh-Hesary, senior assistant to Dean and CEO of the Asian Development Bank Institute (ADBI) has said that Azerbaijani Energy Ministry has prepared a strategic plan for power generation in the future under which the ministry has decided to adopt feed-in tariff system.
“Through the current system, Energy Ministry of Azerbaijan has decided to calculate the price rates for purchase of power from producers in US dollar,” he told Trend on the sidelines of a seminar on energy security in Baku.
Comparing the system with a similar feed-in tariff payment system in Iran, he said that the Iranian government uses the national currency unit to calculate the price rate for the purchase of power from the producers.
“Azerbaijan’s dollar-based agreement would help lure investors as it faces almost zero-risk regarding a possible currency fluctuation. However, this system may increase the ministry’s foreign debts in the international currency,” he said.
Taghizadeh-Hesary suggested that devising a formula to use the combination of national and international currencies in feed-in tariff system could minimize the possible risks for both, investors and the ministry itself.
The ADBI on 12-13 March organized a 2-day course-based training program namely “Achieving Energy Security in Central Asia: Role of Renewable Energy” for officials from 11 state-members of the Central Asia Regional Economic Cooperation (Carec) in Baku, Azerbaijan.
Pakistan, Afghanistan, Azerbaijan, China, Tajikistan, Turkmenistan, Uzbekistan, Georgia, Kyrgyzstan and Mongolia are among the main members of the Carec.
Asian Development Bank is the second largest development bank in the world with 60 state-members and a capital of $150 billion based in Manila.
The research center of the bank namely Asian Bank Development Institute (ABDI) is headquartered in Tokyo, Japan which has ranked second among the world's government-affiliated think tanks, after the World Bank's Development Research Group.