ACWA Power has signed a $300 million investment agreement with the Republic of Azerbaijan’s Ministry of Energy, to build a 240MW wind power project in the Absheron and Khizi regions.
ACWA Power also signed the power purchase agreement and transmission connection agreement with Azerenerji OJSC, the national electrical power company and off-taker for the project.
This is the first foreign investment-based independent wind power project in Azerbaijan structured as a public-private partnership. The plant will aid the country reaching the target of 30% of renewable energy capacity by 2030.
Once complete, it will power 300,000 households and offset 400,000 tonnes of emissions each year, supporting the country’s green ambitions.
Though Azerbaijan has relied largely on natural gas to meet its energy needs, the country is now focussing on diversification and boosting of alternative energy resources. With its excellent wind resources, Azerbaijan’s move towards effectively harnessing wind as a sustainable energy source is being fast tracked by public private partnerships.
Speaking to the Saudi Press Agency, H.R.H. Prince Abdulaziz Bin Salman Al Saud, Saudi Minister of Energy, said: “The Kingdom of Saudi Arabia and Azerbaijan enjoy long-term diplomatic and economic relations, and cooperation between the two countries has been strengthened recently through their participation in OPEC+. Azerbaijan, along with other member countries played an important role in promoting stability in global oil markets. We appreciate Azerbaijan’s efforts to fulfil its obligations under the Declaration of Cooperation, and the high level of compliance it has achieved.”
His Excellency Parviz Shahbazov, Minister of Energy of the Republic of Azerbaijan stated: “The signing of Agreements and implementation of the Project is an indication of the confidence in the business climate in Azerbaijan and will mark a next stage of economic cooperation between our countries. I am confident that after ACWA Power other companies from Saudi Arabia will follow suit and will invest in Azerbaijan.
Concerning the importance of this project for Azerbaijan, I would like to stress that in addition to being first-ever foreign investment based IPP, the wind power station annually will help to generate 1 billion kWh electricity, saving up to 220 million cubic meters of gas, cutting down on 400,000 tons of emissions annually, create new jobs and new production and service areas.”
Mohammad Abunayyan, chairman of ACWA Power shared his sentiments on the occasion, saying: “The signing of three key agreements today is a significant milestone and a strong step towards unlocking the renewable energy potential of the Republic of Azerbaijan. ACWA Power is honoured to partner with the Ministry of Energy, in Azerbaijan and the national electric power company Azerenerji OJSC to develop the first foreign investment based independent wind power plant.”
Mr Balababa Rzayev, President of Azerenerji OJSC said: “According to the contracts to be signed, connecting the 240 MW power plant to be built by the company to the grid and purchasing the power to be generated by the plant will be performed by Azerenerji OJSC. The implementation of this project will stimulate the development of our national economy, play an important role in ensuring the energy sustainability in our country, allow for saving the gas, which is our natural resource, and have a positive impact on the environment.”