Under a joint development agreement, signed in Abu Dhabi on 15 January within the framework of Azerbaijan’s President Ilham Aliyev’s business visit to the United Arab Emirates (UAE), SOCAR and Masdar will together develop offshore wind and hydrogen production projects totalling 2 GW in capacity.
The two companies also signed joint development agreements on 1 GW of solar photovoltaic (PV) projects and 1 GW of onshore wind.
According to SOCAR, the joint development agreements will contribute to further strengthening the cooperation between the Republic of Azerbaijan and the United Arab Emirates. The projects will also support the reduction of greenhouse gas emissions in Azerbaijan, which aims to increase the share of renewable energy in its electricity production capacity to 30 per cent by 2030, SOCAR says.
The joint development agreements were signed some six months after Masdar signed Memoranda of Understanding (MOUs) with Azerbaijan’s government and SOCAR on cooperation on renewable energy and offshore wind-to-hydrogen projects.
Namely, back in June 2022, Masdar and the Ministry of Energy of the Republic of Azerbaijan entered into an agreement to cooperate on offshore wind-to-hydrogen projects with a total of 2 GW in capacity, with steps to creating these projects for production and export purposes outlined.
The now-signed joint development agreements on 1 GW of solar and 1 GW of onshore wind projects also build upon the cooperation agreements signed between the government and the UAE company in June.
At the same time Masdar signed the initial agreements with the Ministry of Energy in June, the company also inked a Memorandum of Understanding with SOCAR to work together on the development of renewable energy projects.
According to the news from last year, these 4 GW are the first phase of the development and, under the initial agreements Masdar entered with the government, there is an option for the UAE company to develop an additional 6 GW of projects as a second phase, bringing the total production capacity to 10 GW.
Azerbaijan has already secured an export market for the electricity produced by its future offshore wind farms with the recently revealed plan to build a subsea interconnection in the Black Sea, agreed upon by the governments of Azerbaijan, Georgia, Romania, and Hungary.
According to the Offshore Wind Roadmap Azerbaijan released in cooperation with the World Bank and the International Finance Corporation (IFC) last year, the country has 157 GW of offshore wind potential, with 35 GW of this being suitable for fixed-bottom projects and 122 GW for floating wind. the potential to install 7 GW of offshore wind power by 2040.
The roadmap also states Azerbaijan could install 7 GW of offshore wind power by 2040 with the right long-term vision, infrastructure development, investment and policies in place.