COP29 host Azerbaijan plans Europe-bound exports of green hydrogen made in 'recently liberated territories'

Azerbaijan, the host of this year’s COP29 climate summit, is planning exports of vast amounts of green hydrogen to the EU, including from the disputed Nagorno-Karabakh region, which until last year had been controlled by an ethnically Armenian breakaway state for decades.

“We are cooperating very tightly, very intensively with the European countries with the great support from the European Union, in order to produce hydrogen, green hydrogen from the offshore wind we have in the Caspian sector, and to transport it into the European market,” Azerbaijan’s Minister of Energy Parviz Shahbazov told the Green Hydrogen Summit today (Tuesday) in Abu Dhabi.

He estimated that the Caspian Sea could site 157GW of offshore wind, which he said would exceed demand for renewable electricity not only in Azerbaijan, but Central Asia more widely.

Azerbaijan has already signed a joint development agreement with Masdar, an Emirati state-owned renewables developer and host of the Green Hydrogen Summit, and a framework agreement with Australian mining and energy firm Fortescue.

Shahbazov added that the government is also in talks with Saudi developer ACWA Power and oil major BP for green hydrogen projects.

However, electrolysers may not necessarily be sited along the coast of the Caspian, but further inland in a recent warzone.

“There is also the special green zone declared in the recently liberated territories of Azerbaijan, after the almost 30 years occupation by Armenia, and those territories we are going to apply... the production of hydrogen,” Shahbazov said.

This likely refers to Nagorno-Karabakh, a region in western Azerbaijan which had since the 1990s been controlled by the self-declared Republic of Artsakh — supported by neighbouring Armenia — which was officially dissolved on 1 January this year following a rapid-fire military offensive by Azerbaijan and a months-long siege of the region in 2023.

The enclave was almost entirely populated by ethnic Armenians that had lived there for centuries, most of whom — more than 100,000 people — fled to Armenia following the Azerbaijani takeover, fearing genocide, ethnic cleansing and persecution due to decades of anti-Armenian sentiment in Azerbaijan.

Azerbaijan and Armenia are currently pursuing opposing cases filed with the International Court of Justice, each accusing the other of systemic racial discrimination and ethnic cleansing.

Hydrogen strategy

Azerbaijan is in the midst of pulling together a national hydrogen strategy, which could provide further details on how and where projects will be deployed.

“The initial studies show that Azerbaijan possesses considerable potential in this field,” deputy energy minister Elnur Soltanov told local reporters.

He cited a 2023 study funded by the European Bank for Reconstruction and Development (EBRD) which found that green hydrogen produced in Azerbaijan would be cheaper than molecules generated in the EU.

This study calculated that a kilogram of green hydrogen could be produced using a blend of wind and solar power in Azerbaijan for €2.92 by 2030 compared to €3.67 in the EU — although the European cost could be a lowball estimate.

While Azerbaijan has vast reserves of natural gas, the report also argues that “high international gas prices... could make the use of domestic natural gas for blue hydrogen economically unfavourable as it would displace natural gas available for export”.