The largest power plant in Azerbaijan will become more efficient and less harmful to the environment, thanks to EBRD financing.
Azerbaijan’s role as an energy transit country is growing and energy security remains a pressing issue. Reliable and more efficient power plants, along with a cleaner environment, are important priorities.
The AzDRES thermal power plant, with a capacity of 2,400 MW, is benefiting from EBRD finance of US$ 92 million. The plant does not operate at the capacity or efficiency that it could, so the loan will help to improve the plant’s reliability and efficiency, introduce better health and safety conditions and lower carbon dioxide emissions.
Complying with Kyoto
The EBRD finance also pursues a number of challenging objectives, such as tariff regulation, financial reporting and qualification under the Kyoto Protocol’s Clean Development Mechanism.
It is estimated that AzDRES can reduce its CO2 emissions by 8.2 million tonnes by 2012, allowing the company to qualify for carbon credits and providing an additional source of income.
The €92 million investment complements an earlier US$ 115 million loan by the Bank signed in November 2006. This sovereign-guaranteed loan addresses the energy sector reform to which Azerbaijan has committed itself in close cooperation with international financial institutions.