Renewable Energy and Electricity Security : Smart Grid development prospects for Azerbaijan

This study focuses and analyzes whether the current traditional electricity system of
Azerbaijan is ready to absorb and incorporate a large share of intermittent and non
dispatchable renewable sources, assesses current reforms in country’s electricity sector and
determines the challenges in the prospect of smart grid development. Azerbaijan has almost
200 GW of technical potential in developing renewable energy sources, however, the
penetration of renewables to the current conventional grid will rise another big issue of
electricity security. The development of a smart grid system is considered as a solution to
renewable energy transition. The study evolves interviews with industry experts as a primary
source to get the complete picture of the existing electricity system and comparative analysis
of the international best-case scenario as a secondary. The findings show that the legislative
background and grid infrastructure are far behind the vision of the government in the prospect
of green energy transition. Current grid may integrate up to 1,5 GW of renewables, however,
problems may occur even with lesser volumes. There is uncertainty arising from management
of variable renewable energy sources within existing electric system which may bring to high
number of power shortages in Azerbaijan upon its integration.