Ilham Shaban: ‘We may be able to join the two shores of the Caspian –  Videocast

  25 March 2023    Read: 6820
 Ilham Shaban: ‘We may be able to join the two shores of the Caspian –   Videocast

‘With a population of a bit over 6 million, Turkmenistan has deserts and steppes covering 80% of its territories, which turns the country into the perfect spot for building solar panels. At the same time, Ashgabat’s interest in renewable and green energy must primarily be stipulated by the criterion of need.’

Ilham Shaba n, Director of the Oil Research Centre, commented on the opportunities that can be introduced with Turkmenistan’s alternative energy potential in his interview with AzVision.az. He added that green energy installations require large plots of land. They must be built away from cropping areas so as not to impact agriculture negatively. Therefore, we usually see them on unused lands, such as the tops of mountains or hills. The large territories of Turkmenistan with a population of slightly over 6 million offer great opportunities. The country runs a length of 1,100 km, with 80% of its territories covered in desert and steppes, which makes it perfectly suitable for solar panels.

‘2022 concluded with Turkmenistan ranking last in the field among the 5 Caspian countries. The Russian Federation still holds the best result: they have produced 5.4 billion kWh of electricity from wind and solar panels. The runner-up is Kazakhstan with 5.1 kWh. Iran comes in third, followed by Azerbaijan. We have stabilized the outcome in Azerbaijan for several years now. We have been producing 150 million kWh of green energy for 3 years, which is slightly more than 0.6% of our total commodity balance.

However, if we look into Azerbaijan’s vision, the steps we have taken, and the decisions we have signed, we clearly see plans to grow the share of green energy in the total electricity balance by 2037. It is no secret that we want to reduce the share of traditional energy by 30% at the expense of solar and wind energy. Yet, we have not seen any statements or plans by the Turkmen government on any advancements in the field.’

- The Turkmen government has been slowly taking steps. How do you see their future?

‘There are two factors to consider. First, necessity prompts you to take certain steps, making you safe in some areas, and shifting onto a new field in others. The second factor is who your economic and commercial partners are and what their requirements are.

Since gaining independence in the 1990s, Azerbaijan’s main economic partner has always been Europe (we also see this in terms of the amount of capital). In fact, it was the same 100 years ago. The situation was similar even during the times of Tsarist Russia and we have been continuing the tradition. It is not only about the arrival of new technologies but also the world trade trends that we are keeping up with.

The other shore of the Caspian sea is isolated from the global market. Turkmenistan has so much gas that it has no need for any other things. But Uzbekistan, which does have needs, is taking steps in the direction of Japan, South Korea, China or Europe and their financial institutions because these are measures born out of necessity.

At the same time, Turkmenistan, which is sitting on trillions of cubic metres of gas, has not been able to increase gas exports since 2016, based on the numbers they have reported. Converting gas to electricity costs them three times cheaper than alternative energy. Thus, Turkmenistan is by far behind us because reasons such as lack of necessity, weak relations with potential partners in the West, and failure to join the Paris Agreement on zero carbon footprint by 2050 (whereas Azerbaijan signed the document in 2016) are impeding its energy transition policy.’

- Azerbaijan has recently signed a cooperation protocol with Georgia, Romania and Hungary on a deep water high-voltage electric cable in the Black Sea. This cooperation is built upon green energy. How possible is it that Turkmenistan will join the project in the future?

‘Azerbaijan is tackling one great project after another both in the wind and solar energy. We are also getting ready for employing the hydropotential of the liberated territories. It would be great for Azerbaijan, should Turkmenistan join this project. Even though Ashgabat has a long way to go to ripen the idea of selling green energy to Europe, we would no longer have the need of producing our electricity out of gas if there was an infrastructure for electricity transmission, connecting the right and left shores of the Caspian Sea. As long as we intend to boost the share of alternative energy to 30% and we need to regularly do the maintenance of the mechanical equipment employed, we could buy the energy we need from a country with rich gas reserves, such as Turkmenistan. What I want to say is that Turkmenistan could convert its gas into electricity and sell it to Azerbaijan, even if it did not have green energy of its own. This, in itself, would be a big leap towards improving the ecological situation and reducing the carbon footprint in Azerbaijan.

I would like to take the opportunity to disclose an interesting fact. The first ever telegraph line in history was installed between the Krasnovodsk and Baku ports in 1902 in the times of Tsarist Russia. The line extended for over 430 km. The communication line that was installed under the sea to reach Baku has a very interesting history. Just imagine that such lines were built under lakes in Europe and America until then. The Transatlantic line was installed afterwards. However, we were the centre of a project of that scale back in the early 20th century. In this regard, proposing the idea you mentioned to one another and making it happen would be a unique undertaking.’

- The Trans-Caspian issues have always proved to be complicated. What obstacles do you foresee?

‘I do not see any. Azerbaijan already has experience in building an underwater high-voltage power line, albeit with assistance from foreign experts.

The Convention on the legal status of the Caspian Sea, adopted on 12 August 2018, mentions the installation of mains between the right and left shores of the Caspian separately, such as oil, gas and water pipelines. It reads that all Caspian littoral countries must sign off on the ecological effects they might produce. At the same time, it says nothing about cables, electricity and infrastructure to transmit it. Why not? I just mentioned the telegraph line between the Krasnovodsk and Baku ports built back in 1902. The line has been updated several times since then. There is a telephone, which is a voice communication channel, which corresponds to modern requirements. Azerbaijan is also implementing the Aktau-Baku fibre optical communication line. Therefore, there is no legal issue here of whether someone likes it or not.’

- If this project does indeed become a reality, how much will this project justify itself in terms of profitability and technical demand?

‘Something globally significant for alternative energy happened on 21 November 2018. The price for 1 kWh of electricity derived from gas is graded up to the price of energy produced at wind turbines in the USA. However, there is a great gap between the US and other countries. Regardless, the cost of electricity produced from alternative sources is still more expensive than that obtained from gas turbines.

Secondly, the volume plays a great part. If you are offering more products at the market, you will still make more due to the sheer volume, even if the difference in the margin is minuscule. The profit from 1 billion kWh of alternative energy in energy huge for Azerbaijan, Kazakhstan, and even Turkmenistan in the future. But there are already locations that produce a trillion kWh of energy. These factors play a great role in terms of profitability.’

- If this project plays out, what are the geopolitical results it can produce in the region?

‘It will yield a positive result regardless of the socio-political formation and the form of management because it is an additional profit. The next step would be to keep up with the current happenings in the world and to adapt them to fit us. This will at least change our attire, demeanour, and overall behaviour, because the main trade partners come from the West, the countries with highly developed technology. Azerbaijan is going towards these trends precisely. Our liaison is mainly with the West, not the East. We have always deviated towards the West be it in education or culture. In this regard, I believe it will have quite positive effects.’

 

Sahil Isgandarov


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