Azerbaijan has one of the highest energy self-sufficiency ratios in the world as a major crude oil and natural gas producer. While the renewable sector has not seen as much attention, the government is now looking to stimulate investment and accelerate deployment, allowing for diversification of domestic energy consumption. In addition, the government is working on a new energy strategy that will set the stage for further policy shifts. Azerbaijan is part of the EU4Energy Progamme, an initiative focused on evidence-based policymaking for the energy sector.


Key energy statistics

Key recommendations, 2021

  • Finalise energy laws and plans and facilitate implementation

    Finalise laws and plans for which approval is pending as soon as possible, and ensure their effective implementation based on clearly designated responsibilities and accountabilities, with adequate resources.

  • Reduce dependence to oil and gas

    Diversify the domestic energy mix to gradually reduce oil and gas dependence.

  • Support the establishment of competitive energy markets

    Institute further structural energy reforms in a phased manner to develop competitive markets based on prices that reflect the full energy supply cost, and to ensure transparent and non-discriminatory grid access.

  • Institute an independent energy regulator

    Support reforms by measures that guarantee the energy regulator’s independence and capacity, and aid the most vulnerable citizens.

  • Increase energy efficiency while limiting energy demand in key sectors

    Take steps to increase the efficiency of energy supply and use, and incorporate energy and climate considerations into long-term urban development and transport plans to limit energy demand growth.

  • Develop the country's long-term energy strategy to achieve its NDC and foster renewable energy

    Develop an integrated long-term strategic plan for energy and climate change that incorporates and builds on reform measures to date, and that aims to deliver the country’s nationally determined contribution (NDC) under the Paris Agreement, including through the use of renewable energy.

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