Electricity brings closer

Analysis Materials 26 December 2006 12:04 (UTC +04:00)

In 2007 electricity import to Azerbaijan amounted to 900mln KW/h this is the forecast by the Electricity Department of the Azerbaijan Ministry of Industry and Energy. In 2004 the electricity import comprised 1,365bln KW/h, in 2005 1,203bln KW/h, while in 2006 it is predicted to comprise approximately 1,006bln KW/h. It is explained with the increase of production capacities in the country construction of new power stations. Thus, every day the energy generation increases 5-6%. This year the electricity generation is expected to comprise 23,800bln KW/h. It will enable the country to cover its energy demand independently in future. But now is still in need of import.


Authorized expert group of Unified Electric System of Russia JSC arrived in Baku to hold the talks on tariffs and volume of the electric power to be delivered to Azerbaijan. Marlen Asgarov, the Vice President of Azerenergy Joint-Stock Company, informed that business and constructive approach provides grounds to say that the sides will be able to find compromise over all questions. However, additional talks might be needed to arrange a concluding decision meeting to the interests of both sides. Earlier, the Russian side announced that it will decrease the delivery of the electric power this year. Before, during the winter period at night, the capacity of the electric power delivery equaled nearly 300 mVt. Next year this indicator will not exceed 60 mVt. If earlier the Russian side was delivering 100 kVt electric power monthly, next year this figure will decreased to 30 kVt. In addition, the Russian side appeared with an appeal to increase the tariff for the delivered electric power up to $0.041 per 1 kVt.

Meanwhile, EES Russia notified Azerbaijan that it will be unable to ensure electricity supply to Azerbaijan next ears in the previous level following the increased demand in the country. Only in the southern part of Russia deficit in electricity made up 20% in 2006. Presently, in order to increase the electric power exchange with Iran up to 700 РњWatt, Azerbaijan is implementing a joint project Initially Though Azerbaijan supposed to acquire 700mln KW/h of Russian electricity, now the purchase of electricity will depend on its cost. In 2008 the volume of delivery from Russia will be reduced to 200mln KW/h.

By the end of the year the delivery of Azerbaijani electricity will remain unchanged: Azerbaijan will sell 350mln KW/h of electricity to Russia at 1.6 cents in night hours.

In 2006, the Russian party supplied Azerbaijan with 770 mln KW/h at the price of 3,636 cents per 1 KW/h. In 2005, Russia supplied Azerbaijan with 1,033 bln KW/h of electric power. The cost of the supplies was 2.8 cents per 1 KW/h.

At the same time, Russia is about to reduce the volume of its electric energy supplies to Azerbaijan that will bring the lack of necessity of the construction of the second transmission line Derbent (Russia) Yalama (Azerbaijan) that has been considered for increasing the electric power transmission capacity from Russia to Azerbaijan and then to Iran.

The volume of the electric power between Azerbaijan and Russia is carried out through electric lines Yashma-Derbend. The 300MW - electricity line enables to export over 1bln KW/h electricity a year. The energy flows were carried out when Azerbaijan saw deficit in electricity. Russia's intention to decrease volume of electricity supply to Azerbaijan rules out the necessity for the construction of the second electricity transmission line Derbent-Yashma, which was designed for the increase of discharge capacity of the electricity supply from Azerbaijan and onwards to Iran.


Azerbaijan insists on preservation of terms and volume of deliveries with Russia, noting that they can be replaced with the electricity deliveries by Iran.

Presently Iran is transferring nearly 10-12 mVt electric power to Azerbaijan per day. in its turn, Azerbaijan returns the debts to Iran for the electric power provided to Nakchivan Autonomous Republic in the volume of 40-50 MV (70MV in rush hours). The electric power is delivered via electric lines Astara (Iran)-Astara (Azerbaijan)-Parsabad (Iran)-Imishli (Azerbaijan).

Earlier Azerbaijan and Iran signed an electricity system contract to take effect on 1 December 2006, whereby Azerbaijan would import 600-700 KW/h electricity per month from Iran during the winter period. This loan would then be returned during the summer period when Iran was at a deficit

Every month Azereneji receives 50-70mln KW/h electricity from Iran. In 2005 the general volume of electricity supplies made up 656 KW /h.

Iran cannot increase the capacity of electricity supply due to technical reasons. Presently, in order to increase the electric power exchange with Iran up to 700 РњWatt, Azerbaijan is implementing a joint project. Its implementation will enable to supply Nakhchivan Autonomous Republic with 150 РњWatt, and the whole Azerbaijan with 400 РњWatt. The program is being implemented jointly with Iran Sunir Co and includes the construction of 330-KW transmission lines - Ali Bayramli Heat Power Plant Imishli Parsabad, 220-kilovolt - Ali Bayramli Heat Power Plant, Salyan, Massali, Astara, as well as substation Salyan, and the extension of other four substations. The total length of the lines will reach 350 km.

The current capacity of the energy exchange is 200MW/w. $75mln has been allocated for the construction of high-voltage electricity transmission lines and substations, including 85% allocated by the Iranian Bank for Export Cooperation and 15% - by Azerbaijan Government.


Azerbaijan and Georgia will hold mutual exchange of the electric power in December. This process is expected to be continued in the future. Presently Georgia transfers nearly 60 mVt electric power to Azerbaijan during the day, and will get it back at other times. Earlier, Georgia completed returning its electric power debts to Azerbaijan.

Georgia set up clearing off its debts to Azerbaijan for the earlier electricity supplies. In the period from 1992 to 1994 Georgia could not settle accounts with Azerbaijan electricity supplies as a result there appeared debt in the amount of $17mln. Georgia delivered only 2mln KW/h to cover its debt and stopped the deliveries after the technical faults in Inguri hydro-eclectic power grid. Tbilisi refused from restoration of deliveries, relating it with energy insufficiency within the country.

Georgia continues electricity supply to Azerbaijan to the country even after the completion of clearing off its debts to the country. 95% of electricity in Georgia is carried out by hydro-power stations and the top production level falls on winter period.


From 2007 Azerbaijan intends to launch import of electricity from Turkey. Transit will be carried out via the territory of Georgia, electricity system which can deliver additional capacities without any problem, while the country will receive its bonus for transit.

At present Azerbaijan's energy debts to Turkey comprise approximately $160mln, which has been accumulated since 1992 at the expense of Turkish electricity supply (450mln KW) to Nakhchivan. In accordance with the agreement, the debt will be returned through the deliveries from Nakhchivan to Turkey. The deliveries will begin on 1 January 2007 and will continue over 10 years. From that date the deliveries from Turkey to Nakhchivan will be ceased.

Thus, two power stations function in the territory of Nakhchivan Autonomous Republic Araz HPS (20 MW) and Vaykhir HPS (4.6 MW), Nakhchivan gas turbine station (50 MW) and a new module power station (87 MW). Besides, around 50MW a year will be imported from Turkey and around 120MW from Iran.

By own forces

However, Azerenerji seems to get prepared for worse scenarios: two big power stations of the country have been transferred to mazut regime Ali-Bayramly power grid and Azerbaijan power grid. The rest thermo-power stations work on gas and in case of refusal from the Russian import it is planned to cover electricity insufficiency at own expense. Next year Azerbaijan can cut import of electricity at the expense increase of own production capacities, it is possible to cut electricity import by 35%-40%. The construction of module power grids in the south and west of the country is complete.

The demand for the electric power in Azerbaijan has importantly increased. The volume of the demand for the electric power has increased by 400 MVt. If for the same period of last year, it equaled 3800-3900 MVt (in New Year holiday 4000 MVt), presently this indicator equals 4350 MVt.

At least, isn't it high time to begin saving electricity?