BAKU, Azerbaijan, May 15. Pilot projects for hydrogen production are being prepared in Azerbaijan, Javid Abdullayev, Director of the State Agency for Renewable Energy Sources under the Ministry of Energy of Azerbaijan, told Trend in an exclusive interview.
"The analysis of the assessment of the hydrogen potential of Azerbaijan by Advision company has been completed with the support of the European Bank for Reconstruction and Development (EBRD). The report contains very positive ratings. In addition, the Azerbaijan's State Oil Company (SOCAR) is also conducting research in this area. There are four options for exporting hydrogen from Azerbaijan. We can export a mixture of natural gas and hydrogen via the Southern Gas Corridor. It is possible to build a separate pipeline for the export of hydrogen. It is also possible to export "green" energy, and electrolyzers can be installed closer to consumers. And, furthermore, other products, such as ammonia, can be produced and exported. Currently, work is underway to prepare pilot projects for hydrogen," Abdullayev said.
He noted that three pilot projects in the field of alternative
energy are being implemented today.
One of them is a comprehensive project implemented jointly with bp.
Although the joint projects with Masdar and ACWA Power are similar,
the project with bp has its own peculiarities. So, this
comprehensive project includes goals related to decarbonization. bp
is implementing this project in the liberated territories. The
Azerbaijan National Agency for Mine Action (ANAMA) has already
completely cleared the territory from mines, where the construction
project of the 240 MW "Shafag" (Sunrise) solar power plant will be
implemented with bp.
"Within the framework of the project, the solution of industrial-scale issues has begun. bp has started geotechnical research on the project. It is necessary to conduct sufficiently in-depth research and measurement work here. We have already started work on the ground as part of the project. The process continues on schedule," Abdullayev added.
According to him, negotiations on the main parameters of the contracts to be signed have already begun.
"A large number of contracts should be signed, it is necessary to determine the conditions. These are rather complex contracts based solely on the legal system and legal framework of Azerbaijan. These contracts differ significantly from the production sharing agreements that are signed in the oil and gas sectors. Unlike equity participation agreements, these agreements do not receive the status of law in the Azerbaijani Parliament. Current laws in force and the formed investment environment create conditions for investment. This is the biggest advantage of these projects over our other projects. These projects clearly show that our legislative system creates transparent conditions for investors," Abdullayev said.
He added that the work on the Garadagh solar power plant project with the UAE's Masdar company is successfully continuing.
"Work is already in its final phase. The power plant is planned to be put into operation by the end of the year. Within the framework of the project, the construction of roads has been completed, kilometers of territory have been fenced, a platform for placing solar panels has been leveled. The construction of the substation is in full swing. Manufactured solar panels are gradually being brought to the site. The number of panels that will be installed here as part of the project is more than 500,000 units. The area of the land allocated for the project is 550 hectares. Direct contracts with the Masdar company have already been signed," Abdullayev said.
According to him, as for the 240 MW Khizi-Absheron wind farm project implemented jointly with the Saudi Arabia's ACWA Power, representatives of the company engaged in construction work recently inspected the construction site.
"The mobilization work has already begun. I hope that we will witness the rapid progress of work on this project," he said.
Abdullayev pointed out that along with pilot projects, there are contracts for the implementation of projects with a capacity of 25 GW.
The electricity that will be produced within the framework of these projects is too much for the Azerbaijani market. This energy must either be converted into hydrogen or other forms that promote decarbonization, or exported. Two export routes are currently being considered. One of them involves electricity transmission by underwater cable along the Black Sea.
"The second meeting of the quadrilateral steering committee on the project has already taken place. The secretariat of this committee is the State Agency for Renewable Energy Sources under the Ministry of Energy. Work on the project is going very fast, it is planned to attract a consulting company. The preparation of the terms of reference is at the final stage. After that, a consulting company will be involved. The tender is planned to be announced during this year," he explained.
According to Abdullayev, another route provides for exports to Türkiye and European markets through Azerbaijan's liberated areas and Nakhchivan along the Zangezur corridor.
"Türkiye itself is a very large and attractive market in this area. Azerbaijan’s Nakhchivan also has a huge potential, especially in the field of solar energy. Many companies are interested in producing energy here for sale on the Turkish market. Very serious work is being done in this direction. A working group has been set up in Nakhchivan to implement projects in the field of alternative energy, and we have submitted our proposals to this working group. We are mainly talking about the production of solar energy, but there is also potential for wind energy,” Abdullayev said.
“Therefore, it is more expedient to build hybrid stations. Given the growing demand for storage facilities in Nakhchivan, some companies also offer the construction of special storage facilities. In general, one of the most important issues in the energy system of Azerbaijan is the formation of storage systems. These works are planned to be carried out in Nakhchivan, since the energy system here is compact and Nakhchivan is geographically close to the Turkish energy market,” he added.
Abdullayev said that according to the concept of the creation of "green" zones, the electricity consumed in Azerbaijan’s liberated areas will be generated only from renewable energy sources.
"These include the Khudaferin and Qız Qalası [Maiden Tower] hydroelectric power plants, the large hydropower potential of local rivers, 10 GW of solar and wind potential. Certain projects related to bioenergy are being implemented here. All district centers will be gasified, and work in this direction is underway. Solar panels with a capacity of 3 kW will be installed on the roof of each house in the villages that will be built and rebuilt in the liberated territories. In this regard, regulatory and technical documents have been prepared, and the State Committee for Urban Planning and Architecture fully controls this process at the design stage. At the same time, the Ministry of Emergency Situations also supports the examination stage. Completely different technologies will be used here. Technologies for the production of thermal energy will be used. The installation of solar energy panels on roofs definitely concerns all projected public buildings," he said.
Abdullayev also touched upon the issue of holding auctions on alternative energy projects.
"Auctions related to alternative energy projects are reflected in the "On the Use of Renewable Energy Sources in Electricity Production" law. The adoption of by-laws to this law is required. This also includes the rules for choosing an electricity producer. These rules have passed all the approval processes, their formation is at the final stage. I hope that these rules will be approved in the near future," he said.
“In addition, the location of the auction must be determined. The entire approval procedure for declaring the selected territory a renewable energy zone has been completed, and a decision on this is expected in the near future. Here we are talking about hundreds of hectares of land where auctions will be held. The soil in this area should be unsuitable for agriculture. All environmental regulations must be observed. The European Bank for Reconstruction and Development supports us in conducting auctions. Draft contracts are also ready to be signed with investors. We are ready to announce auctions. We hope that auctions will be announced before the beginning of the second half of the year," Abdullayev added.
