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Implementation Of Law Of Rational (Efficient) Use Of Energy – Oil, Gas & Electricity

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Law No 359-VIQ, On Efficient Use of Energy Resources and
Energy Efficiency
, of 9 July 2021, having replaced the Law,
On Use of Energy Resources, of 30 May 1996 came into
effect on 1 July 2022. This legal act developed within the EU4ENERGY Project reflects the key energy
saving targets, in particular, reduction of energy consumption and
of CO2 emissions and ensuring a more reliable energy supply.

The scope of Law covers the full energy chain, from production
to end-use consumption. The State policy is aimed at ensuring a
secure and reliable energy system, sustainable development of
economy, attracting investments for implementation of energy
efficiency measures and putting in place high-efficient
technologies, promoting collaboration among and between energy
producers, energy suppliers, including enterprises in charge of
transmission and distribution, and the local authorities.

Energy Audit and Management

An energy audit is a valuable mean to promote the energy
efficiency. Pursuant to the said Law, the energy audit is an
evaluation of non-residential premises and businesses for
cost-efficient measures of energy use, energy saving opportunities,
an amount of energy losses and wastes released into environment, as
well as obtaining information of energy consumption.

The energy audit is mandatory for businesses and non-residential
premises meeting the criteria determined by the Cabinet of
Ministers. These subjects shall undergo the energy audit every
three years. Other businesses, including branches and
representative offices of resident enterprises located outside
Azerbaijan, may conduct the energy audit on a voluntary basis, by
concluding an agreement with an auditor.

An auditor is an individual holding higher energy and economy
education as well as professionally attested by the Ministry of
Energy. The Ministry maintains the public register of the

Apart from the energy audit, the Law provides for implementation
of the energy management system. An energy manager may be appointed
at enterprises whose annual energy consumption exceeds 1,000 tonnes
of oil equivalent and non-residential premises of a floor area at
least 10,000 m2 or whose annual energy consumption exceeds 250
tonnes of oil equivalent.

Efficiency Measures

Energy efficiency measures consist of organisational, legal,
scientific, economical, and technological measures aimed at
promoting the rational use of energy sources.

Implementation of energy efficiency measures and public programs
is supported through:

  • grants and subsidies;

  • implementation of pilot projects;

  • preferential loans; and

  • the energy efficiency fund.

The foregoing incentives also serve for development of energy
management system, cogeneration and high efficiency cogeneration,
financing of scientific-technical activity, supply of smart meters
and use of renewable energy sources.

Other energy efficiency measures include labelling of products
and adoption of eco-design requirements, improvement of energy
performance of buildings.

The energy sector is controlled by the Ministry of Energy. The
Energy Regulatory Agency under the Ministry monitors a rational use
of power by the energy suppliers, putting in place of measures for
prevention of negative impact on environment, and verifies whether
the suppliers implement the measures for reduction of consumption
of primary energy sources (fuel) used to generate energy.

Reduction of CO2 Emissions

To overcome challenges that the climate change is bringing,
governments around the world take various commitments. For
instance, the European Commission adopted a set of legislative
proposals targeting a reduction of the CO2 emissions by 55% by
2030. The Energy Efficiency Directive by the Commission is an
important element to progress toward the climate neutrality.

In Azerbaijan, the energy efficiency policy aims include taking
appropriate measures to cut the greenhouse gas emissions. For
development of the renewable energy sector, the Ministry of Energy
is participating in a number of agreements for power generation
from the renewables. As stated, industries and consumers are being
made responsible for efficient use of power and energy products,
compliance with the rules for the use of energy resources and
controlling their wastes.

The content of this article is intended to provide a general
guide to the subject matter. Specialist advice should be sought
about your specific circumstances.

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