Azerbaijan is well positioned to develop both green and blue hydrogen.
The study prepared by Advisian consulting company with support of the European Bank for Reconstruction and Development (EBRD) reveals that Azerbaijan, with its established refining, ammonia, and methanol markets, along with extensive natural gas distribution systems that could be converted to hydrogen, is poised for significant progress in the realm of low carbon hydrogen demand. Leveraging its existing expertise in ammonia and methanol, the country has the opportunity to decarbonize these industries and explore the production of both blue and green hydrogen.
With abundant renewable resources in close proximity to the Caspian Sea and eastern Azerbaijan, as well as direct access to natural gas reserves in the Shah Deniz field, Azerbaijan is strategically positioned to develop and implement green and blue hydrogen technologies. Blue hydrogen efforts will necessitate investigating CO2 storage opportunities in depleted gas fields and addressing upstream emissions. The well-established natural gas infrastructure, such as the Southern Gas Corridor (SGC), could potentially facilitate hydrogen blending into the gas network for export purposes, further enhancing the country's hydrogen capabilities.
Azerbaijan already possesses high-quality wind and solar resources, boasting 1305 MW of renewable capacity installed as of 2020. The country has set ambitious growth targets, aiming for 30 percent renewables capacity by 2030. While hydropower is the primary renewable energy source currently in use, Azerbaijan's coastal regions along the Caspian Sea offer considerable wind potential, and the eastern part of the country holds significant solar potential. The cost-effectiveness and ample availability of renewable electricity provide a robust foundation for establishing a thriving low carbon hydrogen economy in Azerbaijan.
As the nation continues to leverage its existing assets and embrace renewable energy solutions, Azerbaijan stands at the forefront of the global drive towards sustainable and environmentally friendly hydrogen initiatives.
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