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German official: Use of solar energy in Azerbaijan is question of more distant future

Oil&Gas Materials 20 July 2010 11:18 (UTC +04:00)

Azerbaijan, Baku, July 20 / Trend I.Khalilova /

Germany plans to examine the needs and possibilities for implementing alternative energy sources in Azerbaijan, The German Economy and Technology Ministry's Economic Cooperation with CIS Countries Department head, Andreas Neuman, said in Baku.

"We are also interested in the framework conditions proposed by Azerbaijan, particularly, this relates to electricity tariffs," Neuman said." The possibility of German companies' involvement in implementing such projects can be viewed even on this basis."

He said today it is too early to talk about specific technologies, although there are modest efforts to develop alternative energy sources in Azerbaijan.

"I think it is possible to use 'windmills' in the non-developed regions that have a deficit in energy supply, or such other area, which is already more or less works profitably - in the processing of agricultural run-off," Neuman said. - This is an area where now one can use the production of such energy."

Use of solar energy may be implemented in Azerbaijan in the more distant future, because prices in the country for electricity are too low and such technology does not pay, Neuman said. 

"We have a lot of wind turbines in Germany, which exist due to cross-subsidies within a grid, that is, the producers of renewable energy receive minimum revenue, which is much higher than the rate set at the market," Neuman said." Such minimal revenues provided by law, which are obtained by payments by consumers for the use of this power, otherwise the system, would not have worked. "

Subsidies on the renewable energy sources are less than 10 percent of the cost of electricity in Germany.

"New demands on the grid, which also are expensive, should be applied with the development of these types of energy, namely wind turbines," Neuman said.

According to preliminary studies, Azerbaijan plans to construct up to 100 alternative energy sources in five years. 

Share of alternative electricity sources is less than one percent in Azerbaijan, which accounts for small hydropower plants. European and developed countries agreed on the annual capacity share of renewable energy up to 10-15 percent of total electricity production. Some countries seek to bring this figure up to 20 percent by 2020. For example, the production of electricity from solar, wind will account for 48 percent by 2020 in Germany.

Based on scientists' estimate, just use of the capacity of small rivers can give up to 16 MW of electricity per year in Azerbaijan.

Azerbaijan is taking its first steps towards the development of alternative and renewable energy sources now. If the country brings this figure to 3-5 percent from the current 1 percent in two years, it will be a significant indicator, Azerbaijani Industry and Energy Minister Natig Aliyev said earlier.In the future, 5-7 percent of electricity production and 10 percent of thermal energy may account for in alternative and renewable sources in the country, he added.

The Japanese Tomen Company conducted researches in Azerbaijan, and prepared report based on its three months work in 1998-1999. Construction of wind power station with a capacity of 60 megawatts in Gobustan was estimated at $100 million. This place is most ideal for the construction of wind power station, as in Gobustan the wind at the heights of 10 kilometers is blowing with a speed of 8 meters per second. However, the project was suspended due to its high cost at the time.

A single retail electricity tariff worth 0.06 manat ($0,075) per kilowatt / hour with the wholesale price not higher than 0.04 manat has been functioning in the country already for three years.

At present, the total electric power generation in Azerbaijan is roughly 6,000 megawatts, and total capacity of power plants under the construction will comprise about 1,500 megawatts.

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