00:00Αζερβαίjan's carbon dioxide footprint,
00:02actual greenhouse gas footprint,
00:04is around 60 million tons.
00:06So 2 million tons out of that
00:08will be avoided because of this plant.
00:20Hello and a very warm welcome
00:21to another episode of Energy Frontiers.
00:24This month we take a closer look
00:26at Azerbaijan's newest and most advanced power station,
00:29the 8th November Power Plant,
00:31located in Mingushevere,
00:33often called the nation's energy capital.
00:35In just a moment we'll hear from Deputy Minister of Energy,
00:38Dr. Elnor Soltanov,
00:39about what this means for regional gas diplomacy
00:42and domestic supply.
00:44But first, here's a quick overview of what's in play.
00:47The 8th November Power Plant
00:49is a high-efficiency gas facility,
00:52the largest of its kind in the South Caucasus.
00:56Powered by combined cycle technology,
00:59is designed to generate up to 1,880 megawatts of electricity,
01:04whilst cutting emissions by around 50%
01:07compared to older infrastructure.
01:10Its hydrogen-ready turbines align with Azerbaijan's long-term,
01:15low-carbon ambitions.
01:16And by saving more than a billion cubic metres of gas each year,
01:20it has the potential to reshape the country's energy balance,
01:24both at home and abroad.
01:26So how will the plant contribute to Azerbaijan's energy transition?
01:31And how will its impact be measured in real terms?
01:35I'm delighted to say that I'm joined in studio now to answer all of these questions and more
01:39by Azerbaijan's Deputy Minister of Energy, Dr. Elnor Soltanov.
01:43A very warm welcome. It's great to see you again.
01:46Hi, Rebecca.
01:47Thank you for being here today.
01:48My pleasure.
01:49Let me start by asking you about the 8th November Power Plant.
01:52It's now operational.
01:53But how will you measure its impact beyond capacity?
01:58And what does it actually mean to Azerbaijan in terms of the energy transition and your goals there?
02:02Thank you for the question. Capacity matters when we talk about
02:07the contribution of this new plant to Azerbaijani grid system, economy and overall climate goals.
02:12Why? Because this plant used to be the biggest but least efficient power plant in Azerbaijan.
02:18But now it's the biggest but one of the most efficient power plants in Azerbaijan.
02:22Currently, as we talk, it's producing around 30% of all electricity consumed in Azerbaijan right now.
02:29That means that we are going to be feeling and calculating very clearly how much natural gas
02:37we are going to be saving by relying on this plant at this capacity, at this level.
02:43Second, the earlier plant was boiler plant.
02:47The difference is combined cycle plants are very quick to respond to oscillations in the grid system.
02:54We all remember what happened in Spain a couple of months ago.
02:57This is especially valid and important when we talk about renewable energy.
03:01The plant is expected to free up more than a billion cubic meters of gas each year.
03:05Talk to me about how that surplus will be deployed. Is it purely for exports or do you have other plans?
03:10In the best of all possible worlds, the saving could go up to 1.2 BCM of gas, actually.
03:17And I believe that if you look at the amount of carbon dioxide that are reduced, that are avoided,
03:23it kind of will amount up to 2 million tons.
03:27We can definitely talk about save natural gas that are measured in millions of cubic meters of
03:35gas that we have. This is a very significant amount.
03:38It will be used differently. It could be used domestically or it could become part of our export mix that we are currently realizing.
03:47Recently, OPEC at their ninth seminar talked about there being no end of demand for oil anytime soon,
03:54certainly not ahead of 2050. And they point to an investment of more than 18 trillion dollars
04:00being needed before that time. Does that mean that you in Azerbaijan and with these plants
04:06are continuing to invest in hydrocarbons, but also in the renewable side of things?
04:10I mean, Azerbaijan currently has the presidency of COP29 as well. And what matters, and as COP29
04:18presidency, we have been pursuing this goal, the scientific community and the best available
04:23science tells us that we need to reach net zero by 2050. That's our best shot, really.
04:31It does not mean that by 2050, all hydrocarbons will be out of the sea. What we have been observing in Azerbaijan
04:39is that it is increasingly becoming a natural gas country. And natural gas is important in two
04:46regards. Natural gas is the least polluting of all fossil fuels out there. And second, natural gas,
04:54and we are back to November 8 power plant, is really important for those responsive power plants.
05:02Because those resilient power plants are usually not called fired power plants. So natural gas
05:07fired power plants are really good in terms of integrating more and more renewable energy.
05:13So in that sense, I really commend also as part of the COP29 team that Azerbaijan's push for more
05:19natural gas. Because especially in European continent, as you know, there are a lot of countries that use
05:25coal. And if our gas is replacing that coal, in fact, in that sense, it's actually contributing to
05:32decarbonization. And in case our gas production will increase considerably, that will happen
05:37only if European Commission, with whom we signed a deal in 2022, is going to be supporting this process.
05:45Speaking of November 8 power plant, your turbines are hydrogen ready. But what is the roadmap?
05:51What is the timeline for integration? They will be able to use up to 40% hydrogen. And we already worked
05:59the hydrogen strategy with EBRD. But to be honest with you, hydrogen is very expensive, especially green hydrogen.
06:08Clean hydrogen is very expensive. What we think and the way we started to think about hydrogen is really
06:14related to immense offshore wind resources that we have in the Caspian Sea. Because if we want to develop
06:21those wind resources at scale, we are going to need some storage capacity. And I think in several months'
06:29time, we will start this implementation plan with EBRD. That way, we will have a clearer picture on how
06:35exactly we are going to be implementing this. In terms of the regulations, the policies, and indeed the
06:41infrastructure which you have referenced, what else needs to be put in place to make sure that hydrogen
06:47is firmly integrated into the energy nets? I think the first question is real technology.
06:53We need to have these mature technologies because electrolyzers that especially we use for green
07:02hydrogen, we don't have them at scale. But first and foremost, although I'm saying this last, it's about
07:08economics. It's about the cost of production of green or clean or low carbon hydrogen and who will
07:15eventually pay for that. Because when you blend hydrogen for electricity production, you are
07:21increasing the cost of production. Again, back to November, 8th of November power plant, our states
07:28spend several hundred million dollars for this project. But eventually, this will help our economy,
07:36but also help our climate goals. We have to leave our conversation there. But it's been a pleasure.
07:41Thank you so much for your time. The pleasure is mine. Thank you.
07:45Well, that's all that we have time for in this episode of Energy Frontiers,
07:49but join me again next time from our studio in Baku, Azerbaijan. I'll see you then.
