Azerbaijan’s Clean and Green Energy
Azerbaijan’s role as an energy producing and exporting country has long been associated with hydrocarbons. Since 1994 and the signing of the “Contract of Century,” the country has embarked with its international partners on the extraction and transportation of the oil resources of the Caspian Sea to international markets. However, oil is not the only hydrocarbon that Azerbaijan exports; natural gas is, as a clean energy source, becoming an increasingly important component in the country’s energy exports. With the commissioning of the Southern Gas Corridor (SGC) in late 2020, Azerbaijan reports having exported about 18.5 billion cubic meters (bcm) of natural gas to Georgia, Turkey, and Europe in 2021 (including January 2022). It is reported that, during this time, Europe alone received 8.9 bcm of Azerbaijani gas under both long-term contracts and short-term, spot transactions. Azerbaijan plans to increase natural gas supplies in 2022 and will export 16.2 billion bcm, mainly to Europe, and is considering doubling its capacity in the future.
Azerbaijan’s gas exports are valuable in ensuring diversification of energy sources and routes, although they cannot match or compete with the volumes of gas that Europe received from Russia. Particularly in the wake of rising prices for natural gas, Azerbaijan’s valuable role in providing an alternative source of energy for European markets has been acknowledged by the European Union. During a recent visit to Baku to take part in the 8th Advisory Council meeting on the SGC, Kadri Simpson, EU Energy Commissioner, underscored this emphatically: “Reliable, competitive, affordable gas is making its war to Southern Europe… And with rising energy prices and tightened gas supplies, the Corridor’s role is strategically important for the EU, now more than ever.” Despite the EU’s plan to be carbon neutral by 2050 under its Green Deal, it is also estimated that, until 2030, gas will make up as much as 22% of Europe’s energy mix. The role of Azerbaijan is therefore appraised as being that of a reliable, predictable partner that can provide diversification at affordable prices. There have also been reports of Europe hoping to receive greater volumes from Azerbaijan in the wake of recent gas-supply shortages and the escalation of the situation with the Russian Federation that has brought war to Ukraine.
It has taken considerable work, cooperation, and coordination of efforts by Azerbaijan and its international partners to reach this point. Despite the voices of sceptics, the SGC was completed on time and under budget. Natural gas is a low-carbon, clean energy source and, very recently, the EU announced plans to classify nuclear and gas-fueled plants as green investments by 2030 if they meet certain criteria, including emissions limits. Azerbaijan’s contribution to Europe’s energy security through the SGC also accords with Europe’s decarbonization plans and the country’s objective to reduce greenhouse gas emissions 35% by 2030 compared with the base year, 1990. Given its long-term objective to be a reliable and effective provider of clean energy to Europe, Azerbaijan plans to remain so in the near future by virtue of the development of its potential gas reserves in the Caspian in addition to Shah Deniz 1; these include the Absheron, Babak, Umid, and other fields. Azerbaijan’s proven gas reserves are 2.6 trillion cubic meters and the country also possesses the infrastructure required to continue sustained energy cooperation.
The SGC was built to be an expandable diversification infrastructure, with the existing capacity in TANAP and TAP able to be increased as required. TANAP could be expanded up to 31 bcm transmission capacity, while TAP’s throughput could be doubled to 20 bcm. During the 8th Advisory Council meeting it was announced that market research is under way regarding the further expansion of TAP. Apart from these potential volumes of gas, there are additional potential markets that Azerbaijani gas could be reaching. These include countries in the Western Balkans as well as Hungary and Romania, which hope to receive some volumes in the near future. The interconnectors, such as BRUA (Bulgaria–Romania–Hungary–Austria), IAP (Ionian–Adriatic Pipeline), and IGB (Interconnector Greece–Bulgaria) should enable the delivery of this strategic asset to different corners of Europe.
Going clean in Azerbaijan is accompanied by a process of going green. Despite its oil and gas reserves, Azerbaijan has embarked on increasing the country’s renewable energy output. The country’s overall renewable energy potential is estimated to be 27,000 MW and the technical potential of the Caspian Sea is estimated at more than 150,000 MW.
The government’s aim is to hit a target of 30% renewable energy in Azerbaijan’s energy mix by 2030. Currently, the figure is about 17%, and this mostly consists of hydropower. However, recent developments in Azerbaijan’s renewable energy sector promise to boost this through the utilization of wind and solar energy. Agreements have been reached with Saudi Arabia’s ACWA Power of and Masdar of the United Arab Amirates on the construction of a 240-MW wind and a 230-MW solar power plant in Khizi-Absheron and Absheron-Baku respectively. Already, in January 2022, the ground-breaking ceremony for the wind power plant to be built by AKWA Power has taken place. These projects have attracted foreign investment to Azerbaijan’s energy sector: $300 million and $200 million for wind and solar plants respectively. The wind and solar facilities are expected to produce about 1.5 billion kWh of electricity per year, which will enable saving 300 million cubic meters or more of natural gas for export.
Azerbaijan’s plans for green energy were also approved through an Order of the President of the Republic of Azerbaijan of February 2, 2021, titled “Azerbaijan 2030: National Priorities for Socio-Economic Development,” which, among five national priorities for the coming decade, lists “clean environment and green growth.” This, in turn, is expected to facilitate the application of environmentally friendly, green technologies and increasing the share of renewable energy in the energy mix of the country. In addition, on 31 May, 2021, a law “On the Use of Renewable Energy Sources in Electricity Production” was adopted.
The renewable energy potential of Azerbaijan reached a new level after the 44-day Karabakh War and the liberation of the formerly Armenian-occupied territories. According to initial calculations, the renewable energy potential in the liberated territories is 9,200 MW.
With the decree of the President of the Republic of Azerbaijan dated May 3, 2021, the Azerbaijani Ministry of Energy is set to develop a concept and a master plan for a green energy zone in the liberated territories. Moreover, in June 2021, the Azerbaijani Ministry of Energy signed a Memorandum of Understanding with the UK’s BP on building a 240-MW solar power plant in the liberated Zangiln/Jabrayil region, and work towards this is in progress. In addition to work with regard to solar energy, Azerbaijan is also working with the Islamic Republic of Iran to build the Khudafarin and Qiz Qalasi hydropower plants with a total installed capacity of 280 MW (140 MW on each side).
It is clear that Azerbaijan, apart from remaining an oil-rich country where the first oil well was drilled in 1846 using an industrial technique, is assertively diversifying its energy mix and contributing to the decarbonization efforts of the European continent by exporting clean energy and increasing the share of its own green energy. Supporting clean and green energy has thus become a very significant element of Azerbaijan’s energy strategy.
Seeing Japan – Indonesia Collaboration in Energy Transition Cooperation
Holding the G7 presidency, Japan is increasingly active in establishing relations with several countries. One of them is Indonesia. The relations that have existed so far between Indonesia and Japan are widely visible on the surface. One of them is in the energy transition sector. Indonesia is in need of a large investment to achieve net zero emissions in 2060. An investment of more than 500 million US dollars is needed to make this happen. This is indicated by the great effort to reduce energy that uses fossil fuels (coal, oil and gas) in people’s lives. Including efforts from Japan to cooperate with Indonesia or vice versa in achieving net zero emissions.
Abundant Natural Resources: A Privilege for Indonesia
The abundance of natural resources owned by Indonesia is an important point for the continuation of cooperation between Japan and Indonesia. Natural resources such as hydrogen, geothermal are important values to be further developed into renewable energy. This is a breath of fresh air for Indonesia, which is trying to achieve net zero emissions by 2060.
Replacing fossil fuels such as coal, oil and gas to renewable energy requires extra effort, Indonesia which is rich in energy resources requires a lot of money in terms of exploration of natural resources. renewable energy resources, such as hydrogen, geothermal. renewable in Indonesia. One of them is through a funding scheme through the Asian Zero Emission Community (AZEC). Through this funding, Japan, which is known to be very generous in helping developing countries in terms of energy, is expected to be able to bring change to the renewable energy transition in a country rich in energy resources, Indonesia. This transition certainly requires a short and gradual process.
State Electricity Company of Indonesia abbreviated as PLN, states that dependence on new coal will decrease in 2030. This is due to the presence of power plants from renewable energies such as geothermal, solar, hydrogen and nuclear and wind (Kompas, 2023).
Japan’s Investment to Indonesia
Indonesia, with all its abundance of energy resources, is considered capable of developing an energy transition. The development of electricity from geothermal, water and biomass are the main sector. This was conveyed by the Government of Japan through Deputy for International Affairs, Ministry of Economy and Industrial Development of Japan Izuru Kobayashi. He stated that his party was ready to assist Indonesia in achieving net zero emissions in 2060 with an environmentally friendly funding and technology assistance scheme.
The above was also supported by another Japanese party, namely from Sumitomo Mitsui Banking Corporation (SMBC). Quoting from IJ Global, SMBC has financial assistance to Asia Pacific countries for clean energy projects through Mitsubishi UFJ Financial Group of US$1.5 billion, Sumitomo Mitsui Financial Group of US$1.2 billion, and Mizuho Financial Group of US$1.2 billion. 1 billion US dollars. In Indonesia alone, as of September 2022, SMBC had invested US$221 million.
Various forms of support by Japan as donors and companions for Indonesia to develop renewable energy should be appreciated. According to the author opinion, this is a challenge for the Government of Indonesia and all of stakeholders inside, to create an investment environment that is safe, good and useful for Indonesia’s future. The use of fossil fuels such as coal for power generation needs to be slowly substituted using renewable energy. The Jokowi administration’s policy of subsidizing electric vehicles for the public can be an entry point for the continuation of Indonesia-Japan collaboration in realizing the energy transition.
The Maneuvering Of Gas Commodities As Securitization Of Russia’s Geopolitical Position
Authors: Luky Yusgiantoro and Tri Bagus Prabowo
In 2012, the Yakutia-Khabarovsk-Vladivostok gas pipeline project was redeveloped under The Power of Siberia (News Ykt, 2012). Putin legalized Gazprom (contractors: Gazprom Transgaz Tomsk). The idea named “Power of Siberia” represents the power of gas pipelines to shape and influence Russia’s geopolitical and geoeconomic situation. A new identity will be launched, conveying the Yakutia-Khabarovsk-Vladivostok gas pipeline and gaining international prominence. The Power of Siberia project is an integrated form of GTS (Gas Transmission System) that will bring the Irkutsk gas region in the fertile eastern part of Russia to the Far East and China. The pipeline location is located in the “Far East,” incredibly close to the border with China, and generally in the Asia-Pacific region. Initially, this gas pipeline was built to facilitate gas trade with China and reduce China’s dependence on coal (Pipeline Journal, 2022). What is the value of this project for both countries to become global concerns?
Furthermore, they have the ability or range to carry gas communications for approximately 4000 km. Due to its geographical proximity and shared economic interests, China is Russia’s most progressive partner in terms of a multifaceted regional and international strategy. Russia and China are known as close partners. The aftermath of Russia’s political alliance was to regain global power, status, and influence lost after the collapse of the Union of Soviet Socialist Republics in 1991, which was the driving force behind the end of the Cold War (Oualaalou, 2021 ). Russia has articulated a vision of rebuilding its global reputation using energy, military might, intelligence, and diplomacy. Russia wants to play a crucial role in the global multipolar system because the West rejects Russia’s vision for a new geopolitical order. They saw many important events related to Russia’s moves in the international order, including its response to the actions of the North Atlantic Treaty Organization (NATO) to try to dominate the nations of the world. The former Soviet Union (East), the failures in the Middle East, the annexation of Crimea, and one of Moscow’s recent invasions of Ukraine mark the military as a turning point in Russian geopolitical politics, especially during the Putin era. Russia has three strategic initiative points, including the ability to deploy and interconnect the means (intelligence, diplomacy, military, cyber, and energy) to gain influence and extend Russia’s global footprint. There is.
Moreover, the Fallacies and Western Ties strategy contradicts America First foreign policy tenets (unipolar) and impulsive decisions as a security threat. Russia wants to maintain its lack of regional interests in certain Baltic states (those still under Russian control) and the Balkans (Cooley, 2017). The Balkans (Albania, Bulgaria, Bosnia and Herzegovina, Croatia, Kosovo, Montenegro, North Macedonia, Romania, Slovenia, and Serbia) have been the cornerstones of great power rivalry for centuries. NATO (North Atlantic Treaty Organization) and the EU (European Union) used the momentum of Yugoslavia’s dissolution in the 1990s to integrate the Balkans as geopolitical hotspots on the Western Front (European Policy). War analysts say the ongoing Ukraine conflict is a way for Russia to raise its stakes in the Balkans and reassert its regional influence (McBride, 2022).
In 2020, natural gas will still be the world’s third-largest primary energy requirement for the global community. Even though the COVID-19 pandemic began in 2019, demand for natural gas increased by 5.3% to 4 trillion cubic meters (TCM) in 2021 (BP, 2022). In 2021, Russia’s total natural gas production will be 701.7 billion cubic meters, the second largest globally, contributing to the strong demand in the global energy market. Russia is essential in the natural gas market (Sonnichsen, 2022). The climate crisis is the most obvious obstacle in the global gas market model. It originates from burning carbon with materials derived from fossil fuels such as oil, natural gas, and coal. However, natural gas is acceptable during the energy transition as it burns the least carbon dioxide (CO2) and pollutants of these three substances (EIA, 2022). It is easier than supplying a gas infrastructure that does not provide infrastructure. Operationally, it is optimal. Talks about climate protection, the climate crisis, and the energy transition are being shaped by Western countries as a way of highlighting Europe’s dependence on gas from Russia, which is geographically accessible and still has gas in other gas reserves. The decision to stop sourcing natural gas from Russia continues to cause European controversy. The pipeline network actively built between Russia and Europe is an essential aspect of why this relationship is used as a tool for Russia to apply pressure—on territorial Europe. Europe uses a climate scenario, and Russia uses a gas-dependent scenario. Efficiency and effectiveness will not be achieved if Europe suddenly has to look for other reserves or switch entirely to this energy mix. Then, with Russia’s eloquence in exploiting the situation and the status quo, natural gas pipelines were used as a form of Russian energy diplomacy to dominate its (European) neighbors. Recognizing that the Western natural gas market is no longer preconditioned, moving target consumers to the Asia-Pacific region is one of the most effective energy plans for Russia’s fossil fuel expansion.
Siberia’s first electricity will cost 770 billion rubles, and the investment in gas production will cost 430 billion rubles. The 1,400 mm natural gas pipeline capacity will increase to 61 billion cubic meters (2.2 trillion cubic feet) of natural gas annually. The pipeline lets the world see natural gas as one of the fossil fuels and does not pollute the air with the carbon and other substances of the climate crisis. , through the capital Beijing and down to Shanghai. According to state media, the intermediate phase will go online in December 2020, with the final southern section expected to start delivering gas in 2025 (Cheng, 2022). Through this agreement, Russia aims to extend its power beyond Mongolia into Siberia 2 in 2030 (IEA, 2022). Conditions for Europe to get 40% of natural gas from Russian pipelines. Germany, in particular, sources about half of its natural gas from Russia (Baldwin, 2022). Despite international media reports of embargoes and sanctions, the crisis has hit Europe hard. Europe must adapt its economic policies to politically justified policies and coordinate them with each other. However, this is a geopolitical struggle, and we must ensure that the country retains its absolute superiority. Russia chooses to invest in and plan for natural gas markets in regions that require or depend on natural gas in the energy sector, i.e., Asia-Pacific via China. China, influencing the Belt and Road Initiative (BRI) plan, is reshaping the geoeconomic position of Russia’s Siberia 1 and Siberia 2 power markets (Lukin, 2021). “Geopolitics is all about leverage” is one of Thomas Friedman’s influential geopolitical maxims. If a country cannot expand its influence, it remains a loser. Nevertheless, Russia is far from this analogy, as mentioned earlier. Russia continues to secure its geopolitical position. It is the embodiment of growing confidence in the reliability of natural gas. Russia still wants to become a major player in natural gas.
Remapping the EU’s Energy Partners to Ensure Energy Security and Diversification
Energy security has been a buzz word in Brussels for a few decades but since Russia’s invasion of Ukraine, followed by sanctions, Russian gas cut-off and physical destruction of North Stream pipelines, forecasts on strained EU energy production due to drought, the stakes have gotten much higher. This was confirmed on March 10th by a joint statement by the US President Joe Biden and European Commission President Ursula von der Leyen, reiterating both parties’ determination to “build clean energy economies and industrial bases”, including clean hydrogen and continue to work together “to advance energy security and sustainability in Europe by diversifying sources, lowering energy consumption, and reducing Europe’s dependence on fossil fuels”.
Last week, the EU energy chief Kadri Simson encouraged all Member States and all companies to “stop buying Russian LNG, and not to sign any new gas contracts with Russia. The EU has pledged to quit Russian fossil fuels by 2027 and replaced around two-thirds of Russian gas last year.
In this context, the Southern Gas Corridor (SGC), delivering Azerbaijani gas through (Trans-Anatolian Pipeline) TANAP and Trans-Adriatic Pipeline (TAP) to the EU, plays a key role in current diversification efforts. The EU increased gas imports via pipelines from Azerbaijan from 8.1 bcm to 11.4 bcm last year. Only two years after its completion, the expansion of the Corridor seems to be likely as the EU and Azerbaijan stroke a deal in July 2021 to double the volume of gas delivery to 20 bcm by 2027 in addition to plans to tap into Azerbaijan’s renewables potential, such as offshore wind and green hydrogen. While encouraging Azerbaijan’s accession to the Global Methane Pledge, the deal aims at collecting natural gas that would otherwise be vented, flared, or released into the atmosphere.
With the opening of the interconnector Greece-Bulgaria (IGB), at least 11.6 bcm of gas is expected to be delivered from Azerbaijan to the EU this year. The IGB has been dubbed as a game-changer for the EU’s energy security, especially as it enabled supplies to Bulgaria and Romania. A Memorandum of Understanding on gas supplies between Azerbaijan and Hungary was also signed this year, which shows that more interconnectors will be needed in the EU if TANAP would be expanded from 16 to 32 bcm and TAP from 10 to 20 bcm.
Moreover, investments will be needed to increase gas production in existing and new gas fields (Shah Deniz, Azeri Chiraq Guneshli, Absheron, Shafaq-Asiman, Umid-Babek, etc.), especially considering growing energy demand in Azerbaijan and its neighbours. Since the Russia-Ukraine war, 10 European countries turned to Azerbaijan to increase existing supplies or to secure new supplies. To meet such growing demands, Azerbaijan is poised to increase cooperation with neighbouring states, such as Turkmenistan, which is home to 50 trillion cubic metres of gas reserves – the world’s 4th largest reserves.
Following the Azerbaijani-Turkmen decision to jointly develop the formerly disputed Dostluq gas field, a trilateral swap deal between Iran, Azerbaijan, and Turkmenistan, and the 2018 Convention on the status of the Caspian Sea by all the littoral states; Azerbaijan, Turkmenistan, and Turkey stated that they were looking “to form a coordinated and multi-option system for delivering energy resources to global markets” on December 14th last year.
These developments could be harbingers of a new Trans-Caspian Gas Pipeline (TCGP), a 180-mile under-sea pipeline that could be integrated into the SGC. Labelled as an EU Project of Common Interest, which could also be eligible for funding under the 2019 US European Energy Security and Diversification Act, this strategic under-sea pipeline project could bring an end to the EU’s energy crisis by securing a cheap source of natural gas, whose price is independent of LNG prices while counterbalancing Chinese, Russian and Iranian influence in Central Asia and beyond. On the other hand, Azerbaijan began the transit of oil from Kazakhstan this year in addition to Turkmenistan, which highlights the potential to use the Middle Corridor for hydrocarbons.
During the 9th Southern Gas Corridor Advisory Council Ministerial Meeting and 1st Green Energy Advisory Council Ministerial Meeting in Baku in February, EU Energy Commissioner Kadri Simson stated “Azerbaijan can potentially become the exporter of renewables and hydrogen to the EU”. At the end of last year Azerbaijan, Georgia, Romania, and Hungary agreed to establish a green corridor to supply the EU with around four gigawatts of electricity generated by windfarms in Azerbaijan with the support of the European Commission.
Over the last several months, Azerbaijan signed documents that will provide investments to create 22 gigawatts of renewable sources of energy, both onshore and offshore. In April 2021, the World Bank started funding the offshore wind development in Azerbaijan, which has a potential of 157 GW. In addition to the Caspian Sea, which ranks second in world for its wind energy potential, Azerbaijan has an estimated 27GW in wind and solar power onshore.The current construction of wind and solar plants in Alat (230 MW), Khizi and Absheron (240 MW) and Jabrayil (240 MW) as well as new investment plans, including in Nakhchivan Autonomous Republic, are expected to further boost renewables production in the Caspian state all by living up to its vast green potential. While the country, with a population of 10 million, accounts for only 0.15% of total global greenhouse gas emissions, it defines green growth as a key priority for 2030. The EU supports the implementation of Baku’s Paris Agreement commitments through the EU4Climate initiative.
The Russia-Ukraine war may create a window opportunity for the EU to engage in concrete actions rather than high-flying buzzwords, pushing the bloc to do more strategic and visionary planning regarding future projects linked to its energy security, such as TCGP, and finally diversify away from Russian energy sources for good. Azerbaijan has proved to be a stable partner in these challenging times, which manifested the vulnerability of certain EU states against Russian economic and political pressure due to Gazprom’s immense infiltration of their gas markets for the past several decades. Now it’s the time to play fair game by a new playbook and to remap the European energy partners while investing in a stable, predictable, affordable, and sustainable energy future for the EU.
It’s high time to step up the protection of Europe’s critical maritime infrastructure
After the truth about the Nord Stream pipeline explosion came to light, the whole world knows that the United States...
Seeing Japan – Indonesia Collaboration in Energy Transition Cooperation
Holding the G7 presidency, Japan is increasingly active in establishing relations with several countries. One of them is Indonesia. The...
Women’s mobility must be a key focus in urban policy
Historically, cities across the world have been designed to fit the needs of able-bodied men, or a neutral, often male,...
Lemon peel, flax fibres hold keys to eco-friendly car parts
Natural materials including farm waste can make autos and other industries more sustainable, less toxic By HELEN MASSY-BERESFORD Think of the...
ABC news: Xi signals strength in Russia-China alliance
Chinese President Xi Jinping departed Moscow on Wednesday after two days of highly symbolic meetings with Russian President Vladimir Putin,...
Petr Pavl: “Ukraine must adjust to dwindling Western support”
“We must consider war weariness”, says Czech President Petr Pavl. According to Czech President Petr Pavl, Ukraine must adjust to...
WP: The real lesson from the showy Xi-Putin meeting
Pentagon strategists have always divided the world into East and West, with U.S. regional forces under European Command or Indo-Pacific...
Africa4 days ago
International Conference Strengthens Multifaceted Relations between Russia and Africa
Eastern Europe4 days ago
Untouchable U.S. troops in Lithuania
Southeast Asia4 days ago
Indonesia’s Leadership in ASEAN 2023: Young Generation as Game Changers in Echoing Regional Peace Narratives
Eastern Europe4 days ago
The Ukraine War and Great Power Competition
Science & Technology3 days ago
New discoveries and advances ranging from the BRICS countries to Israel, Japan and South Korea
Economy4 days ago
Blue Economy and its potential in Pakistan
Economy3 days ago
Azerbaijan’s Favorable Climate for Foreign Investments
Europe4 days ago
A Muscular U.S. Foreign Policy and Changing Alliances