Two-thirds of energy in Azerbaijan comes from fossil gas and almost a third from oil. [1] Azerbaijan is a major producer of oil and gas, much of which is exported. [2] Most electricity is generated by gas-fired power plants. [3] [4] Energy in the country is produced using all types of sources, including fuel, renewable energy, water energy, electrical and heat energy.
Corruption in Azerbaijan is alleged to be connected to the oil and gas industry, which is very important for the economy. [5]
Within the country, counting use of exports, greenhouse gas emissions per person are around the world average. [6] Azerbaijan aims to reduce its emissions by reducing gas leaks and reducing flaring. [7]
In 1847, Azerbaijan became the site of the world's first industrially drilled oil well. [8] By 1899, Azerbaijan produced half of the volume of the world's oil. [8]
The Araz hydroelectric power station with a total capacity of 22 MW was constructed in 1970, Tartar hydroelectric power station with a total capacity of 50 MW in 1976 and Shamkir hydroelectric power station with a total capacity of 380 MW in 1982. [9]
At that time, along with the construction of power stations, electrical networks were systematically developed and the country's sustainable energy system was created. In those years, "Ali Bayramli" thermal power station with 330 kV – Aghdam – Ganja – Aghstafa, Ali Bayramli – Yashma – Derbent, 5th Mingachevir, 500kV 1st and 2nd Absheron, Mukhranis – Vali and other power lines, Yashma, Ganja, Agstafa with 330/110/10 kV, Imishli with 330/110/10 kV, Absheron with 500/330/220 kV, Hovsan, Nizami, Mushfig, Sangachal, Masalli, Agsu, and Babek with 220/110/10 electrical substations have been put into operation. [10]
A $53 million loan was granted to Azerbaijan by the European Bank for Reconstruction and Development for the construction of the Yenikend hydroelectric power station in December 1995, and the Yenikend HPP was built with a total capacity of 150 MW. [11]
The reconstruction of the Mingachevir hydroelectric power station, 330 kV Aghjabadi, 110 kV Barda substations and the 330kV Azerbaijan Thermal Power Station – 330 kV Agjabadi-Imishli transmission lines were implemented at the expense of the European Bank for Reconstruction and Development and the Islamic Development Bank. [12]
Two gas-turbine units with a capacity of 53.5 MW each at Baku thermal power station, funded by the German bank – Bayerische Landesbank Girozentrale, and a 400MW steam gas plant at the Shimal power plant at the expense of the Japanese International Cooperation Bank's loan were commissioned in 2002. [13]
On February 14, 2005, the head of state approved the State Program on Development of the Fuel and Energy Complex (2005–2015) in the Republic of Azerbaijan. [14]
The electricity demand of the economy of the country has been completely provided by 12 thermal power stations such as Azerbaijan TPP, Shirvan TPP, Shimal TPP, Baku TPP, Nakhchivan TPP, Astara, Khachmaz, Sheki, Nakhchivan, Baku, Quba, Sangachal power stations, and 6 water power stations such as Mingechevir, Shamkir, Yenikend, Varvara, Araz, and Vaykhir HPP. Their total capacity was about 5,900 megawatts. 90 percent of electricity production in Azerbaijan accounts for TPPs, and 10 percent for hydroelectric power stations. [10]
The Energy Regulatory Agency under the Ministry of Energy was established on the basis of the Department for State Energy And Gas Supervision of the Ministry of Energy of the Republic of Azerbaijan by the decree of the president dated December 22, 2017, and its charter was approved. [15]
According to the World Energy Trilemma İndex, compiled by the World Energy Council for 2017, Azerbaijan has taken 31st place (BBA) among 125 countries. [16]
According to the Global Energy Architecture Performance Index report for 2017, compiled by the World Economic Forum, Azerbaijan ranked 36th out of 127 countries with a 0.67 score. [17] According to the 2016 report from the same organization, Azerbaijan ranked 32nd out of 126 countries with a 0.68 score. Economic growth and development had a 0.68 score, environmental sustainability a 0.57 score, and energy access and security a 0.79 score. [18]
On April 19, 2019, SOCAR president Rovnag Abdullayev and BP’s regional president for Azerbaijan, Georgia, and Turkey, Garry Johns signed a contract for $6 billion. The final investment decision on the Azeri Central East (ACE) platform, which is planned to be built on the Azeri-Chirag-Gunashli (ACG) block, was adopted at the signing ceremony. Construction was scheduled to start in 2019, and the completion was scheduled for mid-2022. [19] [20] [21] [22]
From 1987 to 1993, production decreased from 13.8 million tons of oil and 12.5 billion cubic meters of gas to 10.3 million tons of oil and 6.8 billion cubic meters of gas. The annual rate of decline in production was 7.1% for oil and 13.5% for gas. The exploratory drilling decreased by 17 times, or by 170,000 meters, was 10,000 meters in 1995 compared to 1970. [10]
"Shah Deniz-2" energy strategic projects is the energy security and energy diversification project. [23]
Contract of the Shah Deniz gas field was signed in 1996, [24] and the first pipeline connecting the Caspian Sea with the Georgian side of the Black Sea coast was built in 1999. The Baku-Tbilisi-Ceyhan main oil export pipeline connecting the Caspian Sea with the Mediterranean and international markets was built in 2006, [25] and the Southern Gas Pipeline in 2007. [26] [23] [27] [28]
The 2013 report by UK-based Global Witness NGO revealed that companies working in Azerbaijan’s oil industry have no transparency and accountability. It has been documented that millions of dollars of revenue disappear into the hands of obscurely owned private companies that cooperate with SOCAR. [29] [30]
The report concluded that the opacity of the deals struck by Socar "is systemic" and added, “These findings should be of great concern to the international community as a whole. Oil and its derivative products are central to the Azerbaijani economy, making up 95% of exports in 2011. It is important for Europe that Azerbaijan keeps the oil and gas flowing and maintains a transparent and well-run energy industry. Yet, this briefing shows that much of the oil business in Azerbaijan remains opaque, and corruption is still perceived to be at epidemic levels…" [30]
On March 10, 2016, Natiq Aliyev, Azerbaijani energy minister, publicly said that Azerbaijan has enough gas reserves to fill the Southern Gas Corridor (SGC). The SGC is an energy project whose goal is to move 10 billion cub meters of gas from Azerbaijan through Georgia and Turkey to Europe. [31]
Azerbaijan has an estimated 1.3 trillion cubic metres of natural gas reserves. [32] The country produced 46.7bn cu metres of natural gas in 2022 (up from 43.8bn cu metres in 2021). The natural gas exports of 22.3bn cu metres in 2022, are up from 19bn cu metres in 2021 (a rise of 18%), of which 11.4bn cu metres went to the EU, compared with 8.1bn cu metres in 2021. [33]
Electrical power is the widely utilized energy source in Azerbaijan in terms of domestic and industrial use. [34] [ need quotation to verify ]Electricity production and its distribution are covered by the state-owned Azerenerji JSC and Azerishig JSC. [35] [36] [37] The whole country's electricity demand is furnished by the power stations operating under Azerenerji. 13 of those stations are thermal power stations with the installed capacity of 5,400 MW power, and 17 are hydropower stations with the installed capacity of 1,162.2 MW power. [38] [39] Moreover, a number of small power stations have been set up by other companies in the country by utilizing water, wind, solar, and domestic waste. [39]
Total installed capacity in September 2019 is 6.6455 million kW. Eight thermal plants supply 80% of capacity, including Shimal-2 power station put into used in early September 2019. [38] [40] 12% comes from 2 hydroelectric plants (Mingachevir HPP and Shamkir HPP), and the rest from other thermal, hydro and small hydro plants. The main power plants (both are thermal) are near Shirvan (Janub TPP – 780 MW) and Mingachevir (Azerbaijan TPP – 2,400 MW). [38]
The power of the country's electro-energy system has reached 7,172.6 MW. Currently, the system's capacity is 5,200 MW and the peak power required is around 3,750-3,900 MW. In 2017, the production of electricity amounted to 22,209.8 million kWh including 20,445.4 million kWh at thermal power plants and 1,732.8 million kWh of electricity at hydroelectric power stations and decreased by 2.0% compared to the corresponding period of 2016 (22,665.7 million kWh).
A total of 4,778.8 million cubic meters of natural gas and 311.5 thousand tons of mazut fuel oil were used for electricity generation during the year.
A 50 MVA transformer with 110/35 kV, two 110 kV circuit breakers, and 35 kV electrical equipment were installed at Hoca Hasan substation of Binagadi district. 110 kV double-circuit transmission line between 110 kV Liman and White City substations, three transformer substations with 35 / 0,4 kV were constructed.
In 2017, oil production amounted to around 38.7 million tons in the country. 28.9 million tons of extracted oil belonged to the Azeri-Chirag-Gunashli, 2.4 million tons to Shah Deniz (condensate), and 7.4 million tons to the State Oil Company of the Azerbaijan Republic.
In 2017, President Ilham Aliyev took part in the opening of the following substations:
In January 2015, the president of Azerbaijan, Ilham Aliyev, announced that he would direct his government to create programs to bring investment dollars to industries other than oil. Specifically, President Aliyev cited industrial and agricultural industries as an example. [46]
Aliyev cited Azerbaijani's economy, saying, "That's why it's much easier to attract investments to stable countries with socio-political stability and information growth". He said that the banking industry will become more important in helping develop the country's non-energy industries. [47]
The State Oil Company of the Republic of Azerbaijan, largely known by its abbreviation SOCAR, is a fully state-owned national oil and gas company headquartered in Baku, Azerbaijan. The company produces oil and natural gas from onshore and offshore fields in the Azerbaijani segment of the Caspian Sea. It operates the country's only oil refinery, one gas processing plant and runs several oil and gas export pipelines throughout the country. It owns fuel filling station networks under the SOCAR brand in Azerbaijan, Turkey, Georgia, Ukraine, Romania, Switzerland, and Austria.
Zaporizhzhia thermal power station is a large thermal power plant (DRES) in the purpose-built city of Enerhodar in Ukraine. It is the most powerful thermal power station in Ukraine, with an installed capacity of 2,850 MWe. Its primary fuel is coal. It can also fire natural gas and fuel oil, and has tank storage for these reserve fuels adjacent to the coal bunkers.
Gardabani is a city of 11,650 residents (2021) in the valley or plain of the same name, in the southern Georgian region of Kvemo Kartli and is the administrative centre of the Gardabani Municipality. It is located 34 kilometres (21 mi) southeast of capital Tbilisi and 10 kilometres (6.2 mi) from Rustavi in the Kvemo Kartli Plain at an elevation of 300 metres (980 ft) above sea level. Until 1947 Gardabani was known as Karayazi and the city status was granted in 1969, after a thermal power plant was built for Tbilisi in the 1960s causing rapid growth. Since then more plower plants have been built and the city nowadays supplies almost all thermally generated electricity in the country.
Energy in Armenia is mostly from natural gas. Armenia has no proven reserves of oil or natural gas and currently imports most of its gas from Russia. The Iran-Armenia Natural Gas Pipeline has the capacity to equal imports from Russia.
The Mingachevir Dam is an earth-fill embankment dam on the Kura River just north of Mingachevir in Azerbaijan. It serves several purposes, including hydroelectric power production and water storage for irrigation. The Mingachevir reservoir, behind the dam, supplies water to the Upper Qarabag and Upper Sirvan channels which help irrigate about 1,000,000 ha of farmland in the country. Its six Francis turbine-generators were overhauled or replaced with 70 megawatts (94,000 hp) sets in 2000. Mingachevir reservoir has a storage capacity of 15.730 cubic kilometres (12,753,000 acre⋅ft), covering 605 km2 (234 sq mi). The length of the dam is 1,550 metres (5,090 ft), its width is 16 metres (52 ft) and height is 80 m (260 ft). It is the largest hydroelectric power station in the South Caucasus, and is located on Kura river, not far from Mingachevir city.
Strong foreign relations exist between the Republic of Azerbaijan and the United Kingdom. The Embassy of United Kingdom in Baku opened in 1992. The Embassy of the Republic of Azerbaijan in London opened in 1994. Both countries are members of the Council of Europe, the Organization for Security and Co-operation in Europe.
Azerbaijan–Japan relations are the bilateral relations between the Republic of Azerbaijan and Japan in the political, socio-economic, and cultural fields.
Burshtyn TPP is a coal-fired power plant of Zakhidenergo located in Ivano-Frankivsk Raion 6 kilometres (3.7 mi) south-east from Burshtyn, Ivano-Frankivsk Oblast, Ukraine. It was built in the Soviet era and is now part of Rinat Akhmetov's holdings.
Azerenergy (Azerenerji Joint Stock Company (JSC)) is the largest electrical power producer in the Republic of Azerbaijan. It also maintains the largest distribution network in the country, although the regional power networks are being privatized. Azerenergy was recreated as a state-owned joint stock company in 1996, by decree of President Heydar Aliyev.
Shafag-Asiman is a large complex of offshore geological structures in the Caspian Sea located 125 km (78 mi) southeast of Baku, Azerbaijan. The Shafag and Asiman structures have been previously called D8 and D10, respectively.
The Shamkir reservoir is a large reservoir built on the Kura River in the Shamkir Rayon of northwestern Azerbaijan. It is the second-largest reservoir in the Caucasus after the Mingachevir reservoir.
The Trans-Anatolian Natural Gas Pipeline is a natural gas pipeline in Turkey. It is the central part of the Southern Gas Corridor, which connects the giant Shah Deniz gas field in Azerbaijan to Europe through the South Caucasus Pipeline and the Trans Adriatic Pipeline. The pipeline has a strategic importance for both Azerbaijan and Turkey. It allows the first Azerbaijani gas exports to Europe, beyond Turkey. It also strengthens the role of Turkey as a regional energy hub.
Technopromexport is a Russian engineering company that builds energy facilities in Russia and abroad, including hydropower, thermal, geo-thermal and diesel power plants, power lines and electricity substations. The company was formed in 1955, and was transformed into a joint stock company in April 2006. The company's charter capital is 15.7 billion rubles. The company is headquartered in Moscow.
Energy in Serbia is dominated by fossil fuels, despite the public preference for renewable energy.
Hrazdan Thermal Power Plant is a natural gas-fired power plant in the northwestern part of Hrazdan city, generating electricity in Armenia. It is one of the largest power plants in Armenia. This power plant was built in 1963–1974, and the first unit became operational in 1966. In 2013, a new unit was added. Four older units of the plant are owned and operated by the Hrazdan Power Company, a subsidiary of Tashir Capital owned by the family of Samvel Karapetyan. The new fifth unit is owned and operated by Gazprom Armenia.
Gas and oil make up two-thirds of Azerbaijan's GDP, making it one of the top ten most fossil fuel-dependent economies in the world. Azerbaijan has some renewable energy projects. These include hydropower, wind, and solar and biomass power plants.
Sumgayit Chemical Industrial Park was established by Decree #548 dated December 21, 2011 of the President of Azerbaijan Ilham Aliyev and was registered on May 11, 2012.
Utilities in Azerbaijan cover the topic of public utility services in the territory of Azerbaijani Republic. The utilities of Azerbaijan are provided by the government owned public utilities: “Azersu” for the water supply and waste management, “Azerishiq” and “Azerenerji” for electricity, “Azerigaz” for natural gas, “Azeristiliktechizat” for district heating.
The power generation potential of the rivers in Azerbaijan is estimated at 40 billion kilowatt per hour, and feasible potential is 16 billion kilowatt per hour. Small-scale hydro has significant developmental potential in Azerbaijan. In particular, the lower reaches of the Kura river, the Aras river and other rivers flowing into the Caspian Sea. Hydropower could conceivably provide up to 30% of Azerbaijan’s electricity requirements. Currently, hydropower, dominated by large-scale dams, provides 11.4% of Azerbaijan’s electricity.
Rafiga Abdul Agha gizi Huseynzade is an Azerbaijani scientist awarded the "Shohrat Order", a Candidate of Geologico-Mineralogical Sciences, and an honorary member of the Azerbaijan Oil Geologists Society. She is the chair of the Caspian Environmental Protection Initiative (CEPI) and served as the vice president for ecology at the State Oil Company of Azerbaijan Republic (SOCAR) from 2011 to 2023, becoming SOCAR's first female vice president.