Azerbaijan strengthens green financing framework for renewable energy projects, says official

Azerbaijan is expanding opportunities for “green financing” to support renewable energy projects, officials said at the 13th Caspian Energy Forum in Baku, Azernews reports.

Rza Naghiyev, Director of the Finance Department of SOCAR Green LLC, highlighted that the country has introduced new mechanisms to attract investment in sustainable energy.

“In 2020, the Central Bank adopted several decisions providing a legislative foundation, including the ‘Green Taxonomy,’ which was an encouraging step. However, this is not enough,” Naghiyev said. “Regulatory authorities and the Central Bank should consider these aspects in future stages. Financing requires sufficient capitalization, and conditions should be simplified so that each project can be implemented according to its unique characteristics. Banks and financial institutions should regulate this process and increase interest in green financing.”

He also noted that at the end of 2024, the government included responsibility for procurement in the support mechanism and provided 30-year tax incentives, a significant move to encourage investment not only in green projects but also in broader investment initiatives.

These measures aim to strengthen Azerbaijan’s renewable energy sector, increase investor confidence, and support the country’s transition to sustainable and low-carbon energy solutions.