Low-Carbon Solutions for Azerbaijan

We are contributing to a project designating low-carbon solutions for Azerbaijan. The project result should be a Roadmap recommending relevant policies and technologies. The full title is “Low-Carbon Solutions in the Electric Power Sector of Azerbaijan Technical Assistance Project”.

Azerbaijan relies heavily on oil and gas, which has brought significant economic growth over the years. Oil, gas, and related petroleum products accounted for 91 percent of Azerbaijan’s total exports in 2022 and almost 48 percent of its GDP. Likewise, in 2021, natural gas dominated the electricity generation mix (94 percent). It was followed by hydropower (4.6 percent), waste and biomass incineration (0.7 percent), and solar and wind (0.5 percent).

Meanwhile, there is a vast potential for solar and wind power that investors have already begun to develop.

TIMES-Azerbaijan

Energy Modelling Lab carries out part of the energy systems modelling work for the project. Subsequently, we are updating and tailoring the TIMES-Azerbaijan model we have developed for the EU Commission in 2021. We are using the model to create three scenarios:

A Business As Usual (BAU) scenario reflects current and planned policies concerning low carbon penetration.
One scenario assumes high economic growth and targets carbon neutrality by 2050.
One scenario assumes low economic growth and targets carbon neutrality by 2050.

Stakeholder engagement

We have also been assigned to design and take charge of stakeholder engagement, consultation, and communications. The aim is to foster an understanding of the modelling approaches. The key stakeholders should reach and maintain agreement on scenario assumptions, and we should obtain the necessary feedback. The overall objective is to ensure the full capacity of ownership of the key stakeholders. Additionally, the Roadmap should be credible, robust, and functional.

Energy Modelling Lab has been subcontracted for the project by Tetra Tech. The project is implemented within the Memorandum of Understanding between the Ministry of Energy of Azerbaijan and the European Bank for Reconstruction and Development EBRD on technical support related to the development of the electric power sector of the Republic of Azerbaijan.