Azerbaijan’s goal to diversify its energy mix received a significant boost after the approval of a US$114.2 million financing package from the European Bank for Reconstruction and Development (EBRD), Asian Development Bank (ADB), Japan International Cooperation Agency (JICA) and Abu Dhabi Development Fund (ADFD). The funds will be used to commission a 230 megawatt (MW) photovoltaic solar power plant near the village of Alyat in eastern Azerbaijan.
Funding will be provided to Garadagh Solar Project developer Masdar Azerbaijan Energy LLC, which Abu Dhabi Future Energy Company wholly owns. Masdar is a leading global renewable energy company and an active client of the EBRD, ADB, JICA, and ADFD.
SES is the first private solar energy project in Azerbaijan. The agreement sets a precedent for further private sector participation in the renewable energy market in Azerbaijan, actively supported by the EBRD at the political and investment level.
Once operational, the 230 MW renewable solar power plant in Azerbaijan will generate up to 558 gigawatt-hours (GWh) of electricity, reducing annual CO2 emissions by 265,000 tonnes.
This will support Azerbaijan’s decarbonization program and contribute to Europe’s energy security by increasing the availability of domestic gas for export. In this way, the project will contribute to achieving the United Nations 2030 Sustainable Development Goals (SDGs) priorities.
The EBRD is an essential institutional investor in Azerbaijan, with over €3.6 billion invested in 181 projects. The bank’s strategy in the country is aimed at helping Azerbaijan diversify the economy and develop the non-oil private sector.