Shafag solar power plant breaks ground in Jabrayil: A $200 million milestone for Azerbaijan’s renewable future

A groundbreaking ceremony for the Shafag Solar Power Plant was held in Jabrayil district as part of COP29 activities.

The 240 MW Shafag Power Plant is the first large-scale solar energy project and the largest foreign direct investment initiative in Azerbaijan's liberated territories, Caliber.Az reports via local media.

The project is being developed under an executive agreement signed between Azerbaijani Ministry of Energy and bp on June 3, 2021. During the ceremony, the “Investment Agreement between the Government of Azerbaijan and Shafag (Jabrayil) Solar Limited” and the “Land Lease Agreement between the Ministry of Energy of Azerbaijan and Shafag (Jabrayil) Solar Limited” were officially signed.

Once completed, the Shafag Solar Power Plant is expected to generate around 500 million kWh of electricity annually. This will help conserve 120 to 150 million cubic meters of natural gas and reduce carbon emissions by approximately 260,000 to 330,000 tons per year.

bp, SOCAR, and the Azerbaijan Investment Company are the key shareholders in the Shafag Power Plant, with an estimated $200 million in planned investments for the project.

bp, SOCAR, and the Azerbaijan Investment Company are the key shareholders in the Shafag Power Plant, with an estimated $200 million in planned investments for the project.

The Shafag project is expected to pilot a new commercial structure called a “Virtual Power Transfer Arrangement” will enable the project to produce solar power and deliver it to the national power grid operator, AzerEnergy, in the Jabrayil district. AzerEnergy would then deliver an equivalent quantity of electricity to the Sangachal terminal near Baku, which would in turn enable the terminal to use this renewable electricity for its energy needs.

By Vafa Guliyeva