EBRD spearheads effort to auction off renewables in Azerbaijan

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The development process, which is to be initiated from May, will be aimed at helping the country’s Ministry of Energy to identify true market prices for specific sources of renewable energy. The plan is to create a fair, transparent auction process. Azerbaijan’s electricity sector is currently dominated by state-owned AzerEnerji, which oversees generation and transmission, and state-run Azerishiq, which handles distribution.

The EBRD said that investment in the two-year project could reach up to €1.25 million ($1.4 million). It will likely finance the initiative by drawing upon its “Technical Cooperation Funds,” according to an online statement.

The bank expects the chosen consultant to assist with a range of matters. The winning company will oversee the selection of a site for a wind farm by referring to technical and environmental concerns, as well as the financial feasibility of development. It will also design and help implement a competitive bidding process, in addition to preparing all tender-related documentation needed to deploy a competitive procurement process for a PV project and a wind farm.

Consultants from any country of origin are welcome to apply. The EBRD expects applicants to be experienced in the economic, legal and policy-related matters that must be considered when developing competitive auction schemes for renewables. They should be well-versed in the drafting of secondary legislation in the electricity sector and have specific knowledge of PV and wind project design. In addition, applicants should be able to provide technical advisory services relating to the integration of intermittent renewables to the grid, as well as environmental impact assessments.

Companies with experience in the power sector of any country in the Caucasus region will have an advantage, particularly those familiar with local network and grid codes. Prospective consultants can submit technical and financial proposals to the EBRD.

The bank estimates Azerbaijan’s solar potential at 8 GW. However, very little solar has been built in the country thus far. By the end of 2017, just 34.6 MW of PV capacity had been installed, according to the International Renewable Energy Agency (IRENA). That said, the EBRD estimates Azerbaijan’s solar potential at 8 GW.