Introduction of alternative energy sources beneficial for Azerbaijani economy

Oil&Gas Materials 27 April 2020 20:03 (UTC +04:00)
Introduction of alternative energy sources beneficial for Azerbaijani economy

BAKU, Azerbaijan, April 27

By Nargiz Ismayilova - Trend:

The introduction of alternative energy sources brings benefits to the economy and the Azerbaijani population, Jamil Melikov, deputy chairman of the Azerbaijani State Agency on Alternative and Renewable Energy Sources, said in an interview with Trend.

While speaking about the benefits of creating the renewable energy power plants, Melikov stressed that these stations are built in such a way that energy is supplied to the end consumer without losses..

“At the same time, a consumer may sell surplus energy and purchase the missing volumes from the same energy system,” deputy chairman added.

“Moreover, the population will receive better energy from these plants than from other sources,” Melikov said.

As for the economic benefits of using alternative energy sources, Melikov said that in this situation, the country would save money in gas consumption, which could be exported at a higher price.

While speaking about investments, the deputy chairman stressed that foreign investments worth $400 million provide Azerbaijan with one billion kilowatt-hour energy production potential, while 240 million cubic meters of gas will be saved in the country.

“Knowing and expecting that a regulatory framework will be formed, investors are ready to implement their projects and invest in alternative energy in Azerbaijan,” Melikov added. “Thus, Saudi Arabian ACWA Power company and UAE’s Masdar company are implementing the projects to build a 240 megawatt wind power plant and a 200 megawatt solar power plant."

“A legislative and regulatory framework for the development of alternative energy is being prepared in Azerbaijan,” deputy chairman added. “A bill on the use of alternative energy sources has been prepared.”

"The conditions for holding auctions have also been prepared, through which the project executors and investors who are interested in implementing the projects in the field of alternative energy, will be selected," Melikov said.

“The conditions for signing an energy supply agreement have been prepared,” Melikov said.

"This is a very important long-term document, according to which the tariff policy stipulated in it is maintained during the period of return of investments from 15 through 20 years, and the state undertakes to purchase energy which is generated by investing enterprises," Melikov said.

“Such aspects are important for demonstrating the guarantees that investors, making investments in the alternative energy market in Azerbaijan, will receive and boosting their confidence,” deputy chairman said. “Therefore, it is necessary to prepare an appropriate legislative and regulatory framework to attract investors.”

“Today there is a certain tariff policy for the wholesale sale of electricity by the producer to the Azerishig power distribution system in Azerbaijan,” Melikov said. “Users of electricity during the construction of own power stations become, on one hand, consumers, and on the other hand, producers.”

"Such entities, in accordance with the decree of the Cabinet of Ministers regulating relations in the electric power industry, are called active consumers,” deputy chairman said. “The meters are installed for these users and a balance of consumed and produced energy is maintained between Azerishig and an independent consumer."

“A user may sell part of the received energy to the network,” deputy chairman said. “At the same time, a user will receive 0.05 qepik (0.02 cents) per kWh at the wholesale tariffs. When using excess energy, a user will pay 0.07 qepik (0.04 cents) per kWh while an entrepreneur - 0.09 qepik (0.05 cents) per kWh.”


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