On 2 November 2022 the first SDG dialogue “Green transformation in Azerbaijan” brought together over 100 representatives of the government agencies, the United Nations (UN), international financial institutions (IFIs), the diplomatic community, the private sector, civil society and academia.
The participants of the event, organized by the National Coordination Council on Sustainable Development of Azerbaijan, the Ministry of Economy, the UN and the World Bank, reviewed Stories 27 Azerbaijan’s progress towards achieving the green growth indicators and reflected on additional policy measures to accelerate the country’s green transformation and progress toward the SDGs.
The analysis of Azerbaijan’s progress was based on green growth indicators developed in 2016. Namely, country progress on 38 green growth indicators were analyzed under five categories: (i) socio-economic efficiency; (ii) environmental and resource efficiency; (iii) natural asset base; (iv) environmental dimension of quality of life; and (v) indicators of economic opportunities and policy response. Most of these indicators are aligned with the national SDGs and contribute to measuring 16 national SDG indicators of the total of 119.
The analysis has shown that a strong foundation of policies and regulations pursuing green growth have been built up in Azerbaijan, creating a conducive ground for accelerated green transformation in the country. “Azerbaijan 2030: National Priorities for Socio-Economic Development9” and the "Strategy of Socio-Economic Development in 2022-2026" identified a clean environment and country of “green growth” as one of the five priority directions of the country’s development up to 2030. Under the Paris Agreement on climate change the
country has committed to a 35 per cent emission reduction target by 2030 compared to the base year of 1990.
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Order of the President of the Republic of Azerbaijan on approval of “Azerbaijan 2030: National Priorities for Socio-Economic Development”, February 2021
At the COP26 in Glasgow, Azerbaijan announced its intention to reduce emissions by 40 per cent by 2050 as a voluntary commitment and to create a “Net Zero Emission” zone in the regained territories. The Government has recently stepped-up efforts to promote energy efficiency and renewable energy. Two new laws on (i) rational use of energy resources and energy efficiency; and (ii) the use of renewable energy sources in the production of electricity were adopted in 2021.
However, the country’s green growth progress has been mixed, with faster progress in the early 2000s, slowdown after 2010 and stagnation or reversal of progress on some of the indicators in the period post 2015.
The energy intensity of Azerbaijan’s economy, measured as a ratio of total primary energy supply to the unit of GDP, has reduced between 2007 and 2010, but then it was stagnant until gaining an upward trend starting 2015. The CO2 productivity, measured as the unit of GDP produced per kg of CO2 emitted, remains largely unchanged over the past 10 years (Figure 9), implying the need for further actions to effectively de-couple the GDP growth from CO2 emissions growth. The share of renewables in electricity production has reduced from 18.4 per cent in 2010 to 5.8 per cent in 202110. Meanwhile, the adoption of the Law on renewable energy coupled with large scale renewable energy projects that are now in progress, are expected to significantly boost the share of renewables in the coming years.
10 State Statistical Committee of Azerbaijan: environmental protection
The Ministry of Energy has set a target to increase the installed capacity of renewable energy to 30 per cent in the country’s overall energy balance by 203011. For this purpose, it is planned to create a total of 1,500 MW of new generation capacities, including 440 MW in 2023, 460 MW in 2023–2025, and 600 MW in 2026–2030, at the expense of renewables. The real gamechanger, however, could be Azerbaijan’s offshore wind potential of 157,000 MW. On 3 June 2022, the Ministry of Energy of the Republic of Azerbaijan, the World Bank, and the International Finance Corporation (IFC) published a new roadmap indicating the possibility to install 7GW of offshore wind power by 2040.
11 According to the “Strategy of Socio-Economic Development in 2022-2026"
CO2 emissions and productivity in Azerbaijan, 2007–2018
The official data also indicates the increased levels of PM2.5 air pollution in the three major cities of the country: Baku, Ganja and Sumgayit, where the PM2.5. concentration was 27, 28 and 22 micrograms per cubic meter respectively in 2021.10 According to the WHO standards, PM2.5. concentration above 15 mcg/m3 is considered harmful for health and may increase the risk of serious respiratory and lung diseases.
As to waste management, what is notable is that the total and per capita volume of household solid waste has been increasing at an accelerated pace since 2018 (Figure 10). Household solid waste is a source of methane gas emission, through decomposition of waste at landfills. More attention and investments in solid waste management might be therefore required.
The central question to fostering green growth is about how to de-couple the economic growth from environmental degradation and GHG emissions. As the international expertise indicates, the answer to this question rests on the ability of countries to change the traditional linear model of production – consumption – waste to the circular model, which puts resource efficiency, recycling, and environmental regeneration at the centre. Switching to circular models will require strong institutions, which oversee and implement integrated
policies and create effective incentives for green transition. Greening the demand side will also play a crucial role for successful green transformation. Without the change of behaviours both by firms and households it will be difficult to significantly improve the resource efficiency and reduce waste and pollution.
Solid waste generation by households in Azerbaijan, 2000–2021
As to the financing of green growth, continuing investments in old, brown technologies would be a missed opportunity, therefore highlighting the need for expanded green finance schemes. Success of leapfrogging to green and developed economy will depend on innovations and absorption of modern technologies. These in turn require increased investments in skills building, research and development and scaling up of green finance and investments in green sectors.
Measuring and reporting on green growth progress is instrumental to guide the decision-making process. Reporting on green growth progress in Azerbaijan has already been put in place by the State Statistical Committee. This information platform needs to be continuously improved, and shared with policy makers and general public, to both inform the decision making, as well as promote collective green behaviour change.
United Nations Economic Commission for Europe
Palais des Nations, Geneva
