BAKU, Azerbaijan, July 1. Air pollution has been a big concern for a while now, but it has become even more pressing in large cities due to the high concentration of vehicles there. In line with worldwide trends, Azerbaijan is switching to fuel production that meets Euro-5 criteria, which will reduce the harmful effects of transportation emissions on the environment.
This standard, recognized as the most modern and environmentally friendly, significantly reduces toxic emissions, improving air quality and public health.
Moreover, enhancing fuel quality according to Euro-5 standards helps lower car maintenance costs, providing an additional economic incentive for vehicle owners.
Studies indicate that a significant portion of air pollution stems from emissions produced by vehicles running on fuels that do not meet modern standards. In response to this issue, many countries are accelerating the transition to electric cars and regulating the price of diesel fuel to reduce its usage.
Economic expert Emin Garibli told Trend that he sees Azerbaijan's adoption of the Euro-5 standard as a positive step. He drove home the point that this decision is a game-changer in improving environmental quality.
"In general, the introduction of Euro-5 standards aims to mitigate environmental pollution. The phased implementation of Euro-6 and Euro-7 standards is also pivotal for further environmental improvement. However, Euro-8 standards are not currently planned," he noted.
Euro-5 is just the beginning of a much larger shift toward higher standards, which Garibli sees as paving the way for even more integration and lower prices.
"Azerbaijan is free of polluting factories like those in Europe or East Asia, which minimizes its overall environmental impact. However, the adoption of new standards helps the country integrate into the global economy and the European economic space.
The implementation of Euro standards also reduces operating costs and enhances the productivity and efficiency of industrial production," he added.
Garibli is confident that the transition to higher standards will not halt at Euro-5, foreseeing it as a step toward further integration and cost reduction.
"When examining gasoline prices, the gap between 92 and 95 brands is negligible in many countries, yet in Azerbaijan, it remains relatively wide. Hence, it is crucial to take steps to narrow this difference and align it more closely with global standards.
The analysis of gasoline and other product production reveals that their costs today significantly differ from those of twenty years ago. This underscores the importance of implementing high standards in the context of global price increases, impacting both the environment and geopolitics, and exerting pressure on developing countries like Azerbaijan," he added.
According to Faraj Akhundov, Ph.D. in economics, the reason behind this decision is the change of tune towards greener energy and gasoline that is kinder to the environment.
"AI-92 gasoline and diesel emit higher levels of pollutants. AI-95 gasoline emits fewer pollutants, and AI-98 emits even fewer. With the increasing import of hybrid cars to Azerbaijan, which predominantly use AI-95 gasoline, the demand for them naturally rises. To incentivize the transition to cleaner vehicles and reduce emissions, the government has decided to lower the price of AI-95 gasoline while increasing prices for diesel fuel and AI-92 gasoline. Additionally, hybrid and electric buses will soon operate in Azerbaijan, mitigating potential price pressures in the transportation sector," he explained.
Another point he made was that AI-95 fuel will help lower pollutant levels.
"Furthermore, it's important to note that new hybrid engines require AI-95 gasoline for optimal performance. Overall, aligning with our green energy policy, this shift will lead to decreased pollution nationwide, as AI-95 gasoline is more environmentally friendly compared to AI-92 gasoline and diesel," he added.
Akhundov emphasized that bringing fuel quality up to the Euro-5 standard is a win-win situation for consumers, as it cuts down on maintenance expenses and makes vehicle parts last longer.
"In general, the Euro-5 standard has undergone extensive testing, confirming that its adoption enhances the long-term efficiency and reliability of vehicles," the expert added.
Fikrat Yusifov, an economist and founder of the Ekonomiks International Economic Research Association, told Trend that the global energy landscape is rapidly evolving, with significant growth in alternative energy production.
"Some European countries now derive up to 50 percent of their energy consumption from alternative sources. We are witnessing the beginning of a revolutionary shift in global energy supply. Over the past decade, global production of electric vehicles has increased more than 140-fold, with over 26 million electric vehicles now in use worldwide. Many countries, especially in Europe, have committed to phasing out internal combustion engine vehicles by 2035," he explained.
He claims that, in light of the aforementioned events, it is indisputable that Azerbaijan must follow the path taken by numerous nations.
"Today, especially in our capital, atmospheric emissions from gas and particularly diesel-fueled vehicles are significant contributors to environmental pollution and pose serious health risks to the population. We witness daily how hundreds of diesel vehicles, emitting exhaust gases that constitute the majority, contribute to Baku's environmental degradation and harm public health. To address this issue, the Azerbaijani government has taken steps to enhance fuel quality and transition to Euro-5 standards in the initial phase," he emphasized.
Akhundov highlighted that the reconstruction and modernization of the Heydar Aliyev Oil Refinery will enable the domestic market to access fuel meeting Euro-5 standards.
"Cars using high-quality gasoline will emit fewer toxic gases into the atmosphere, reducing harmful emissions and overall fuel consumption. This shift is crucial as it aligns with our country's commitment to becoming a leader in green energy production. Furthermore, Azerbaijan will host COP29 in November, a major event aimed at addressing global climate challenges," emphasized the economist.
Considering that diesel fuel offers better environmental protection, reducing the price difference between it and gasoline is a logical step.
The economist noted that one of the main reasons for aligning the price of diesel fuel with gasoline is the recent increase in the import of diesel-powered cars, which contribute more significantly to Azerbaijan's environmental pollution.
"The recent shift towards environmental cleanliness warrants urgent attention and action. It is well-recognized that in developed countries, diesel prices typically exceed gasoline prices, aimed at reducing its usage. Another critical factor is the global disparity in gasoline prices, with studies indicating lower prices in poorer and oil-producing nations compared to developed ones. Given these considerations, where does Azerbaijan currently stand after the recent fuel price changes?
In Azerbaijan, technical constraints prevented local production of AI-92 gasoline, necessitating imports that increased its retail price by up to two manat ($1.17) per liter due to additional financial burdens. However, the restart of local oil refineries to produce this gasoline has reduced its price by 0.40 manat ($0.2). Looking forward, as more vehicles transition to AI-95 gasoline in Azerbaijan, the government's decision to lower its price by 20 percent reflects a strategic move towards aligning gasoline prices with the budgets of citizens.
Notably, even after these adjustments, the new price of AI-95 gasoline in Azerbaijan remains competitive, lower than in most countries worldwide, including those in the CIS region. This underscores Azerbaijan's favorable position in the global market for gasoline prices," he said.
The introduction of Euro-5 standards in fuel production in Azerbaijan is a significant step towards improving the environmental situation and the quality of life of citizens. This transition not only reduces the level of toxic emissions and contributes to economic incentives for car owners, but also helps the country integrate into the global economy, meeting modern international standards.
So, moving to Euro-5 fuel in Azerbaijan is a big deal for the future of sustainability and environmental friendliness; it will help with both protecting the environment and improving people's quality of life.
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