Azerbaijan’s state electricity producer Azerenerji has signed a $58.6 million contract to build a battery energy storage system with a capacity of 250 megawatt-hours.
The agreement was signed with Turkish company YEO Teknoloji Enerji ve Endüstri, and the system is expected to enter service within one year.
Contract Includes Financing
The project will be delivered under an EPC-F model, meaning the contractor is responsible for engineering, procurement, construction and financing. Local banks will provide the funding with a four-year repayment term.
The contract covers the supply and installation of batteries, power conversion equipment, battery-management systems and energy-management systems. YEO will also build a high-voltage energy center and connect the facility to the grid.
The batteries will be manufactured by REAP Battery, a member of the YEO group. Construction is expected to begin soon.
Additional Capacity Follows Two Earlier Systems
YEO signed contracts in 2025 for two other energy storage systems with a combined capacity of 500 megawatt-hours. According to the company, those facilities entered service in the second quarter of 2026.
The new 250-megawatt-hour project will mark the next phase of Azerbaijan’s expansion of grid-scale energy storage capacity.
The agreement’s terms were published by Report, citing Turkish sources.