Central Asia Relies on Gulf As it Targets Energy Transition – Bourse & Bazaar
Central Asia Relies on Gulf As it Targets Energy Transition Bourse & Bazaar
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Energy Cooperation between Gulf Cooperation Council (GCC) and Central Asia and the Caucasus
Introduction
Since gaining independence in 1991, states in Central Asia and the Caucasus have historically had strong energy ties with Russia and China. However, in the past 5 years, they have significantly expanded their energy cooperation with the member states of the Gulf Cooperation Council (GCC). This article explores this unidirectional cooperation, where Gulf companies and institutions are investing in energy assets and infrastructure in Central Asia and the Caucasus, with a particular emphasis on the Sustainable Development Goals (SDGs).
Background
The GCC and Central Asia have a history of ties in the traditional energy sectors of oil and gas. However, the new interregional cooperation focuses on alternative energy sources such as solar, wind, hydropower, and hydrogen. This shift aligns with the GCC’s wider energy diplomacy agenda to transition from being the world’s leading fossil energy center to being the world’s leading energy center in a broader sense. The recent Gulf investments in Central Asia and the Caucasus play a crucial role in this effort.
Key Players
In both regions, the energy sector is characterized by blurred lines between private and government-owned companies. The largest Gulf companies involved in developing new energy assets in Central Asia and the Caucasus are UAE-based Masdar and Saudi-based ACWA Power. These companies, although driven by financial motives, are also accountable to the political elites in the UAE and Saudi Arabia.
Projects in Central Asia and the Caucasus
Masdar has a broad range of projects in Uzbekistan, Azerbaijan, Armenia, Kazakhstan, and Kyrgyzstan, including solar parks, wind projects, and plans for pumped hydropower. ACWA Power’s regional assets include wind parks and utility-scale solar parks in Azerbaijan and Uzbekistan. Both companies are actively involved in developing renewable energy projects in the region.
Cooperation Agreements
At the COP29 United Nations climate talks in Azerbaijan, Saudi Arabia signed agreements with Azerbaijan, Kazakhstan, and Uzbekistan to enhance cooperation in renewable energy development and transmission. ACWA Power was named as the company responsible for the renewable energy projects in these countries. The Saudi Electricity Co. also signed an MoU to develop regional interconnection projects with counterparts in Azerbaijan, Kazakhstan, and Uzbekistan. These agreements symbolize a move towards regional energy diplomacy.
Joint Initiative
Masdar, ACWA Power, and SOCAR Green (a branch of the State Oil Company of Azerbaijan) have formed a joint initiative to explore offshore wind projects, green hydrogen production, and carbon capture, utilization, and storage. This collaboration between Masdar and ACWA Power demonstrates the possibilities for cooperation between the Gulf’s green energy pioneers and the Central Asia and Caucasus states hosting their investments.
The Gulf’s Energy Diplomacy Agenda
The Gulf’s investments in Central Asia and the Caucasus reflect a broader energy diplomacy agenda. The GCC aims to leverage its role as the world’s leading fossil fuel producers to remain an energy epicenter, regardless of the fuel system. This interregional cooperation is seen as a success in achieving this agenda, but its financial and political returns remain uncertain.
Photo: Dunyo
SDGs, Targets, and Indicators in the Article
1. Which SDGs are addressed or connected to the issues highlighted in the article?
- SDG 7: Affordable and Clean Energy
- SDG 9: Industry, Innovation, and Infrastructure
- SDG 13: Climate Action
- SDG 17: Partnerships for the Goals
2. What specific targets under those SDGs can be identified based on the article’s content?
- SDG 7.2: Increase the share of renewable energy in the global energy mix
- SDG 9.1: Develop quality, reliable, sustainable, and resilient infrastructure
- SDG 13.2: Integrate climate change measures into national policies, strategies, and planning
- SDG 17.6: Enhance North-South, South-South, and triangular regional and international cooperation on and access to science, technology, and innovation
3. Are there any indicators mentioned or implied in the article that can be used to measure progress towards the identified targets?
- Investments in renewable energy assets and infrastructure in Central Asia and the Caucasus by Gulf companies and institutions
- Number and capacity of solar, wind, hydropower, and hydrogen projects in Central Asia and the Caucasus
- Agreements and cooperation between Gulf countries and Central Asian countries on renewable energy development and transmission
- Development of regional power grid interconnection
Table: SDGs, Targets, and Indicators
| SDGs | Targets | Indicators |
|---|---|---|
| SDG 7: Affordable and Clean Energy | 7.2: Increase the share of renewable energy in the global energy mix | – Investments in renewable energy assets and infrastructure in Central Asia and the Caucasus by Gulf companies and institutions – Number and capacity of solar, wind, hydropower, and hydrogen projects in Central Asia and the Caucasus |
| SDG 9: Industry, Innovation, and Infrastructure | 9.1: Develop quality, reliable, sustainable, and resilient infrastructure | – Investments in energy infrastructure projects in Central Asia and the Caucasus by Gulf companies and institutions |
| SDG 13: Climate Action | 13.2: Integrate climate change measures into national policies, strategies, and planning | – Agreements and cooperation between Gulf countries and Central Asian countries on renewable energy development and transmission – Development of regional power grid interconnection |
| SDG 17: Partnerships for the Goals | 17.6: Enhance North-South, South-South, and triangular regional and international cooperation on and access to science, technology, and innovation | – Agreements and cooperation between Gulf countries and Central Asian countries on renewable energy development and transmission |
Source: bourseandbazaar.com
