Serbia and Azerbaijan sign EUR 600m deal to build ~500 MW combined-cycle gas plant near Niš

An agreement to develop, design, construct and operate a combined-cycle gas-fired power plant near the city of Niš was signed by the governments of Serbia and Azerbaijan, launching a project with an expected installed capacity of about 500 MW and an estimated investment of EUR 600 million.

The document — exchanged between the Government of Serbia and the Government of Azerbaijan — was signed by Serbian Minister of Mining and Energy Dubravka Đedović Handanović and Azerbaijan’s Minister of Economy Mikail Jabbarov during a visit by Azerbaijani President Ilham Aliyev. Officials said the plant will supply power and heat underpinning growth in the south of Serbia, including rising electricity demand, new data centers and industrial needs.

Project details released by Serbian authorities put the plant’s output at 350 MW of electricity and 150 MW of heat, with natural gas for generation to be supplied by Azerbaijan. Serbian President Aleksandar Vučić told visiting counterparts that construction is expected to take a little more than two years. The president also described the signed document as a term sheet and said Belgrade plans to complete preparatory steps within two to three months so conceptual design work can begin.

Parliament speaker Ana Brnabić had previously indicated that negotiations on the plant were complete and reiterated the EUR 600 million investment estimate in September 2025.

Alongside the power-plant agreement, the two countries exchanged six additional documents covering cooperation in media and communications, the economy, food safety and health insurance, and they held the inaugural session of a strategic partnership council to deepen bilateral ties. Observers say the project strengthens Serbia’s energy links with Azerbaijan and complements earlier gas-supply arrangements between the two states.

The Do-to-build timeline, financing structure and operator responsibilities will now move into more detailed planning and negotiation. Government sources emphasized the strategic objective: add baseload capacity quickly while securing fuel supplies and supporting regional development.

Tags: Serbia-Azerbaijan energy deal, Niš gas power plant, combined cycle gas, EUR 600 million investment, baseload capacity, gas supply Azerbaijan, Serbian energy security, data center power, Dubravka Đedović Handanović, Mikail Jabbarov