Challenges in Implementing Renewable Energy Sources in Azerbaijan

Abstract

The gradual reduction of fuel resources, their depletion, as well as volatility of fuel prices led to a growing interest of countries in the use of renewable energy sources. Despite the fact that energy production in Azerbaijan currently largely depends on development of hydrocarbon reserves in the country, nevertheless, development of renewable energy sources is certainly one of the strategic priorities of the government. The main objective of the research is to study the economic problems and institutional aspects of introduction of alternative energy in Azerbaijan and develop recommendations to stimulate production of renewable energy. With the help of methods of comparative analysis and dynamic comparisons, the state of development of alternative and renewable sources in Azerbaijan was analyzed. The results of the study show that in order to increase the production of renewable energy it is necessary to take a number of measures in this area: improve legislation, introduce state incentives for consumers of alternative energy, apply a green tariff to attract investment, ensure transparency and consistency of energy policy.