Saudi-based ACWA Power Signs $400M Azerbaijan Desalination Deal

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Azerbaijan’s first large-scale seawater desalination plant is about to be constructed by Saudi-based ACWA Energy, beneath a not too long ago signed $400-million public-private partnership settlement. It’s a uncommon Caspian Sea venture for the water and energy contractor and a milestone for the nation’s water sector.

ACWA Power introduced Dec. 26 that it executed a design-build-finance-own-operate-maintain concession with Azerbaijan’s state water authority, the Azerbaijan State Water Assets Company, beneath a 27.5-year time period. The venture firm might be wholly owned by ACWA Energy at signing, with extra particulars to be introduced at monetary shut.

Map of Azerbaijan showing Baku on the Caspian Sea and Sumgayit northwest along the coast.

ACWA Energy plans to develop the nation’s first large-scale seawater desalination plant at Sumgayit, situated close to the capitol of Baku, beneath a $400-million P3 deal.

Map courtesy of Adobe

The deliberate facility can be situated at Sumgayit Industrial Park, about 19 miles northwest of the capital, Baku, alongside the Caspian coast.

The positioning locations the venture inside Azerbaijan’s major coastal industrial and inhabitants hall, serving the Baku metropolitan space—together with the Absheron Peninsula—which has a inhabitants of about 3.2–3.3 million, in accordance with Azerbaijan’s state statistics and United Nations city knowledge. Azerbaijan’s complete inhabitants is roughly 10.2 million, in accordance with official nationwide statistics and World Financial institution knowledge.

Azerbaijani government-linked reporting, citing ACWA Energy and water-agency officers, has indicated a deliberate capability of about 300,000 cu m per day. At full output, the plant might provide roughly 2 million folks at typical city consumption ranges, underscoring its potential function as a stabilizing water supply for the Baku–Absheron hall quite than a marginal complement.

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The venture is advancing as unbiased scientific assessments have flagged long-term water-supply dangers within the Caspian area. The Intergovernmental Panel on Local weather Change and NASA have identified rising temperatures and evaporation—not short-term hydrology—because the dominant drivers of sustained water-level declines on the planet’s largest enclosed inland sea.

A peer-reviewed examine printed in Nature Communications initiatives continued declines beneath most warming eventualities, whereas World Financial institution water-sector opinions for Azerbaijan have cited the development as a rising constraint on coastal infrastructure and municipal provide planning.

The subsequent key milestones for the desalination venture would be the monetary shut and EPC disclosure, which can make clear whether or not the venture is delivered beneath a single EPC wrap or a number of building packages.

Consumption and outfall design, energy sourcing and vitality depth might be among the many most consequential technical choices, given the Caspian Sea’s shallow coastal circumstances and the ability’s scale. These components are usually finalized shortly earlier than a discover to proceed on comparable desalination P3s.

Energy-supply preparations, together with grid connection and energy-intensity assumptions, haven’t been disclosed, nor have financing preparations, lenders or a building notice-to-proceed date. ACWA Energy stated these particulars might be supplied after monetary shut.

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Azerbaijani officers have beforehand indicated that a number of agreements tied to the desalination program had been executed in 2025, together with land-use and state-support devices, positioning the plant as a flagship water-security funding. The power is anticipated to be transferred to the state water company on the finish of the concession time period, in accordance with Azerbaijan-based reporting.

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