Azerbaijan, Georgia, Romania and Hungary are preparing for the next stage of a large-scale project aimed at exporting electricity from the Caspian region to Europe. A ministerial meeting involving the countries participating in the Caspian-Black Sea-European Green Energy Corridor is scheduled to take place in Bucharest in late November 2026. The total investment required is estimated at €22.1 billion. The project envisages the development of high-voltage electricity transmission infrastructure across the South Caucasus and a subsea cable connection across the Black Sea, potentially opening up a new route for supplying renewable energy to the European market.

 

Preparations for the Bucharest meeting were among the key issues discussed at the latest board meeting of Green Energy Corridor Power Company (GECO), which is responsible for advancing the project. According to the company, participants reviewed the outcomes of the investment forum held in Baku on 22 October, which brought together potential investors, international financial institutions and representatives of relevant organisations.

During the upcoming ministerial meeting, Azerbaijan, Georgia, Romania and Hungary are expected to assess the progress made and agree on the next steps towards implementing the initiative. Particular attention will be paid to attracting investment, engaging with financial institutions and preparing the project for a final investment decision.

According to GECO's investment presentation, the total cost of the Caspian-Black Sea-European Green Energy Corridor is estimated at €22.1 billion. Of this amount, approximately €14.3 billion is expected to be allocated to electricity transmission infrastructure, while a further €7.8 billion will be directed towards developing renewable energy generation capacity. Thus, the bulk of the investment will be required not only for electricity generation but also for establishing complex cross-border infrastructure to deliver electricity to European consumers.

The project envisages the construction of three independent high-voltage direct current (HVDC) transmission lines, each with a capacity of 1.3 GW. Their combined transmission capacity is expected to reach 3.9 GW by 2040. The route will originate in Azerbaijan, pass through Georgia, cross the Black Sea and connect to the European electricity grid in Romania and Hungary.

The project is scheduled to be implemented in three phases. The first line, following the Baku–Ksani–Anaklia–Constanța–Albertișa route, is expected to become operational in 2032. The second line, connecting Baku, Tskaltubo, Poti and the Bucharest area, is scheduled for commissioning in 2036. The third phase envisages the construction of an additional connection between Baku, Georgian energy hubs and Romania's Constanța by 2040.

One of the most technically challenging components of the initiative will be laying the subsea electricity cable across the Black Sea. The offshore section of each line is expected to be approximately 1,120 kilometres long, with a maximum installation depth of around 2,200 metres. This will require specialised technologies, substantial engineering resources and international cooperation in the construction and operation of energy infrastructure.

Azerbaijan's renewable energy potential is expected to serve as the main source of electricity for the new corridor. In particular, the project envisages developing offshore wind power in the Caspian Sea, where the potential is estimated at approximately 25 GW. Additional sources of electricity will include solar and onshore wind power plants. According to the feasibility study, exports of renewable electricity to the European Union could reach approximately 8 billion kWh annually following the launch of the first line in 2032 and increase to 20 billion kWh by 2040.

The project's economic benefits are also expected to be substantial. According to estimates by the Italian consulting company CESI, the annual economic benefits could amount to approximately €860 million following the commissioning of the first line, rise to €1.8 billion after the second phase and exceed €3 billion upon completion of the third phase in 2040. Another expected benefit is a reduction in carbon dioxide emissions of approximately 3.6 million tonnes annually by 2040.

The project's financing model envisages a combination of public and private investment, long-term loans from international financial institutions, commercial bank financing and potential support from the European Union. In particular, the possibility of securing grants under the Connecting Europe Facility (CEF) is being considered. However, the potential involvement of European financial instruments does not mean that the relevant funding has already been allocated or formally approved.

For Azerbaijan, the project could complement its existing role as a supplier of hydrocarbons to European markets and create new opportunities to integrate its national energy sector into European infrastructure. For Georgia, the initiative offers prospects for strengthening its transit role and attracting investment in its electricity networks. Romania and Hungary, in turn, could gain an additional source of electricity and new opportunities to diversify their energy supplies.

At the same time, the scale of the required investment, the technical complexity of laying subsea cables and the need to coordinate tariff and commercial arrangements among the four countries remain significant challenges. Another essential condition for the project's implementation will be the availability of sufficient electricity generation capacity and long-term supply agreements.

 

The forthcoming meeting in Bucharest will mark an important stage in the transition from technical and economic planning towards identifying concrete financial and organisational mechanisms for implementing the project. If successfully implemented, the initiative could strengthen energy connectivity between the Caspian region, the South Caucasus and the European Union.

CCBS Research Desk

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07.11.2026 06:13