Saudi Arabia’s ACWA Power has reached a major financial milestone with the close of $238 million in senior debt facilities to develop Azerbaijan’s Absheron-Khizi 240 megawatt (MW) Wind Farm, the largest renewable energy project of its kind in the Caucasus region.
Financed by the European Bank for Reconstruction and Development (EBRD) and the OPEC Fund for International Development, the investment highlights Azerbaijan’s commitment to diversifying its energy mix and reducing carbon emissions.
ACWA Power secured a $120 million Shariah-compliant equity bridge loan from First Abu Dhabi Bank (FAB) in December 2023, providing critical support for the project’s initial phases.
With construction underway, the wind farm is slated to begin operations by the first half of 2026, supplying clean energy to nearly 300,000 Azerbaijani households.
The project involves a 25-year power purchase agreement (PPA) with Azerbaijan’s national electricity utility, Azerenerji, ensuring the long-term sustainability and financial viability of the wind farm. Upon completion, it is expected to reduce annual carbon emissions by 400,000 tonnes, marking a significant step forward in Azerbaijan’s transition away from natural gas towards renewable energy sources.
Marco Arcelli, CEO of ACWA Power, stressed the project’s alignment with Azerbaijan’s energy transformation goals, stating, “This wind farm reflects what can be achieved when private and public sectors collaborate to mobilize finance in support of climate action. We are proud to support Azerbaijan’s shift from natural gas to renewable energy in line with its clean energy ambitions and hope this is the first of many such projects.”
With Azerbaijan largely dependent on natural gas, the Absheron-Khizi project represents a shift in energy policy aimed at reducing fossil fuel reliance.
The strategic involvement of EBRD and the OPEC Fund highlights the importance of international financial partnerships in supporting large-scale renewable energy initiatives, which are essential for meeting the targets set by the Paris Agreement and other global climate initiatives.
The Absheron-Khizi Wind Farm is an integral part of ACWA Power’s broader global strategy to lead in renewable energy and green hydrogen development.
As a major player in the Middle East’s renewable energy market, ACWA Power has expanded its portfolio across solar, wind, and water desalination projects throughout the Middle East, Asia, and Africa. The wind farm in Azerbaijan represents the company’s latest move to provide clean energy solutions to markets with high potential for renewable development.
In recent years, ACWA Power has enhanced its global footprint with significant renewable projects in Southeast Asia and Africa.
The company’s success in attracting financing and regulatory support for such projects strengthens its reputation as a pioneer in sustainable energy, positioning it well to contribute to the global clean energy transition.
As part of Azerbaijan’s broader strategy to diversify its energy resources, the Absheron-Khizi project will serve as a model for future renewable energy initiatives in the region. By investing in wind and solar power, the Azerbaijani government aims to meet growing energy demands, reduce environmental impact, and position itself as a regional leader in sustainable development.
The Azerbaijani government’s support for renewable energy aligns with its pledge to reduce greenhouse gas emissions and combat climate change.
The country’s Deputy Prime Minister and other officials have expressed optimism about the wind farm’s potential to enhance energy security and provide a cleaner, more resilient power supply for the country and its neighbors.
ACWA Power’s collaboration with Azerbaijani authorities and its financing partners showcases the critical role that cross-border investments play in achieving energy security and sustainability.
The financing from EBRD and the OPEC Fund highlights the importance of international cooperation in advancing energy projects that address climate concerns, while simultaneously meeting local energy needs.
Once operational, the Absheron-Khizi Wind Farm will underscore Azerbaijan’s clean energy ambitions by significantly contributing to its renewable energy capacity and reducing its reliance on fossil fuels.
The project is expected to spur additional investment in renewable infrastructure in Azerbaijan and other regions traditionally dependent on fossil fuels, reflecting a broader trend toward sustainable energy solutions across the Caucasus.
