BAKU, Azerbaijan, October 24. Siemens Energy is
exploring opportunities to provide solutions for converter
substations based on high-voltage direct current (HVDC) technology
within the framework of the Caspian–Black Sea–Europe Green Energy
Corridor project.
This was announced by the company’s Vice President for Türkiye,
Central Asia, and Western Europe, Maxim Zubov, in a video posted on
the Azerbaijani Ministry of Energy’s social media accounts, in
which he shared his views on the forum “Green Energy Corridor: From
Feasibility Study to Implementation.”
He noted that the company is also prepared to assist in
establishing connections with potential electricity buyers in
Europe. According to Zubov, the company views the project as a
significant international initiative that supports the development
of renewable energy sources, contributes to the diversification of
Europe's energy supply, and strengthens ties among the
participating countries. He noted that the project could also
contribute to strengthening Azerbaijan's electricity grid.
"As one of Europe's leading suppliers of high-voltage direct
current (HVDC) technologies, we are exploring opportunities to
provide technological solutions for the project's HVDC converter
substations," Zubov said.
According to him, the company's technical team is holding
discussions with the client, representatives of the Green Energy
Corridor project, and the design institute to identify optimal
solutions for the project.
Zubov added that the company could support the implementation of
the project by leveraging its network of clients and partners in
Europe.
"We have an extensive network of clients and partners in Europe.
In this regard, we are prepared to assist in organizing discussions
and establishing connections with potential electricity buyers. We
believe that, by doing so, we can make an additional contribution
to the successful implementation of the project," the company
executive emphasized.
Siemens Energy is an international company operating in the
fields of power generation, electrical grids, energy storage
systems, and the electrification of industrial processes. According
to the company, it possesses over 150 years of experience in energy
technologies. Siemens Energy operates in 90 countries and has
approximately 100,000 employees.
Investment prospects for project
At a forum held in Baku, the results of the feasibility study
for the Caspian–Black Sea–Europe Green Energy Corridor project were
presented for the first time to international investors, financial
institutions, and business partners. The event covered the
project's investment attractiveness, business model, financing
opportunities, and the establishment of new partnerships, as well
as preparations for reaching the Final Investment Decision
(FID).
According to the project's feasibility study, investments in
electricity transmission infrastructure are projected to amount to
14.3 billion euro. The document was finalized in July 2026 and
approved by the governments of Azerbaijan, Georgia, Romania, and
Hungary. The project is currently in the development phase.
The study indicates that the project will have a total
transmission capacity of 3.9 gigawatts (GW), involving the
construction of three power lines, each with a capacity of 1.3 GW.
The project's internal rate of return (IRR) is estimated at
11.7%.
Projections suggest that, starting in 2032, the corridor will be
capable of transmitting 8 terawatt-hours (TWh) of renewable
electricity annually to the European Union. By 2040, the annual
transmission volume is expected to reach 20 TWh.
The feasibility study forecasts that revenues generated from
managing transmission constraints within the energy system will
exceed 315 million euro per year, starting from 2032. It is also
noted that the project will enable a reduction in carbon dioxide
emissions by 3.6 million tons per year by 2040.
The annual economic benefit of the project is expected to
increase as the power lines are commissioned in stages. It is
projected that this figure will reach 860 million euro following
the commissioning of the first line in 2032, and 1.8 billion euro
after the second line becomes operational in 2036. With the
commissioning of the third line in 2040, the annual economic
benefit is expected to exceed 3 billion euro.
Speaking at the forum, Azerbaijan’s Minister of Energy, Parviz
Shahbazov, stressed the strategic importance of the project in
terms of strengthening regional energy security, diversifying
energy supplies, and facilitating the green transition.
The minister noted that the project holds a special place in
Azerbaijan’s strategy to become a regional hub for the production,
transmission, and export of green energy. The reaffirmed political
support for the project during the recent visit of European
Commission President Ursula von der Leyen to Baku was also
highlighted. Strengthening the project’s investment prospects
through efforts to include the project in the draft TYNDP 2026
(Ten-Year Network Development Plan) for the European electricity
grid, as well as the attainment of "Project of Mutual Interest"
(PMI) status, was noted.
The Green Energy Corridor, envisioned to span approximately
3,000 kilometers, is planned to be commissioned in phases starting
from 2032, with a target transmission capacity of 4 GW. According
to the feasibility study, the project could facilitate the
development of at least 8 GW of renewable energy generation
capacity in the region, enable the transmission of approximately 20
billion kilowatt-hours of electricity to Europe annually from 2040
onwards, and contribute to a reduction in carbon emissions by up to
3.6 million tons.
One of the primary technical challenges of the project involves
the planned installation of subsea power cables at depths of up to
2,200 meters in the Black Sea. Consequently, the necessity of
employing advanced technological solutions to carry out operations
at such depths has been emphasized.
The consideration of a hybrid business model combining regulated
and commercial components to ensure the project’s commercial
sustainability was pointed out. This model is intended to be based
on long-term power purchase agreements, the participation of
private capital, and the development of cross-border electricity
trade.
Shahbazov said that the involvement of international financial
institutions and private investors, a robust business model, and
long-term commercial agreements are essential prerequisites for
reaching a final investment decision.
"Our goal is to transform the Green Energy Corridor into a
regional infrastructure project characterized by a clear business
model, a sustainable financial structure, and attractive terms for
investors. Azerbaijan’s strategic location, extensive experience in
international energy projects, and reliable relationships with
partner countries provide a solid foundation for achieving this
objective," noted Shahbazov.
At the conclusion of the forum, the development of a partnership
roadmap and the next steps toward reaching a Final Investment
Decision (FID) for the Green Energy Corridor project were agreed
upon.
Project participants
The Caspian–Black Sea–Europe Green Energy Corridor is a
cross-border electricity transmission project involving Azerbaijan,
Georgia, Romania, and Hungary. The initiative was established under
a strategic partnership agreement signed in Bucharest on December
17, 2022, with the participation of the European Commission.
The development of the project is being handled by Green Energy
Corridor Power Company (GECO), a joint venture registered in
Bucharest. The company is owned by the national electricity grid
operators of the four participating countries: AzerEnerji
(Azerbaijan), Georgian State Electrosystem (Georgia),
Transelectrica (Romania), and MVM (Hungary). Each participant holds
a 25% stake in the company.
The project has been included in the Ten-Year Network
Development Plan (TYNDP) 2026 of the European Network of
Transmission System Operators for Electricity (ENTSO-E), under
project numbers 1248 and 1244.
The next phase of the project involves the preparation of an
implementation plan, the clarification of financing options, and
the continuation of preparatory work for the final investment
decision in 2029.
