Baku, August 3, AZERTAC
The Japan International Cooperation Agency (JICA) signed a Project Finance Loan Agreement with the Limited Liability Company “Masdar Azerbaijan Energy” (hereinafter referred to as “the Borrower”), which implemented the project of photovoltaic solar power plant in the Republic of Azerbaijan. This is the first project in Azerbaijan since the resumption of private sector investment and financing and is co-financed by the Asian Development Bank (ADB), the European Bank for Reconstruction and Development (EBRD) and the Abu Dhabi Fund for Development (ADFD).
Since its independence in 1991, Azerbaijan has achieved spectacular economic development through oil and gas exploration, which in turn has been achieved through the active introduction of foreign capital as well as the export of these resources . The country’s energy mix is heavily focused on fossil fuels, with gas-fired power generation accounting for over 90% of its total electricity generation (IEA 2019 projection), and the negative environmental impact is high . The government aims to adhere to the Paris Agreement and seeks to increase the share of renewable energy to 30% by 2030. This loan will support the achievement of these goals and ensure a stable supply of electricity. Furthermore, the urgent challenge is to develop photovoltaic power generation facilities near Alat settlement in Garadagh while minimizing the tax burden by mobilizing private sector investment. This project will contribute to the achievement of goals 7 (affordable and clean energy), 13 (climate action) and 17 (partnerships for the goals) of the SDGs.
This is the first large-scale solar energy project (230 MW) in Azerbaijan in which construction and operation are to be carried out by a private company. The borrower’s sponsor, Abu Dhabi Future Energy Company PJSC (Masdar), is one of the largest developers of renewable energy projects in the Middle East. They are active in more than 40 countries and have extensive experience in the production of renewable energy. As a model project, this venture is expected to attract future investment from private companies in subsequent similar projects in Azerbaijan and the Central Asia and Caucasus region.
AZERTAG.AZ :Japan International Cooperation Agency Signs Project Finance Loan Agreement with “Masdar Azerbaijan Energy” Company
© Content on this site must be hyperlinked when used.