The article examines the formation of an innovative development model and the assessment of green energy potential in ensuring green industrial development in Azerbaijan. The problems of developing and modeling the green industry have been explained. The positive impacts of the green industry on the environment have been analyzed and systematized. Taking into account new challenges, an assessment of the development potential of the green energy industry in Azerbaijan has been conducted. The positive aspects of various types of green energy, including clean and inexhaustible energy sources such as solar, wind, water, biomass, and geothermal, were explained. The possibility of taking effective measures to reduce carbon emissions, prevent environmental pollution, and ensure energy security by expanding the green economy and increasing the production of green energy has been substantiated. The potential of green energy types to significantly reduce carbon emissions and make a significant contribution to maintaining ecological balance has been explored. The development of the green energy industry can ensure the economic revival and improvement of the social well-being of regions. In terms of environmental protection in Azerbaijan, the importance of improving the processes of using and neutralizing waste generated by industrial sectors was emphasized. The volume, use, and disposal of waste generated by industrial enterprises in Azerbaijan in 2024 were analyzed. The role of digitalization and innovation in the development of the green industry was examined. The possibilities of artificial intelligence, blockchain, big data, and other digital technologies were explored. The main benefits of implementing an innovative development model in Azerbaijan are given. The benefits of implementing an innovative development model in industry are schematically presented. The importance of forming an innovative development model in ensuring green industrial construction in Azerbaijan was stated. The implementation processes of a number of major projects related to the development of the green energy industry were analyzed. The volume of electricity generation from green sources has been analyzed. The power of hydro, solar, and wind power plants has been given. The need to develop efficient energy storage systems to ensure a stable green energy supply has been highlighted. In the near future, generalizations were made, recommendations and proposals were prepared on the creation of an innovative development model for green industrial construction in Azerbaijan, and the assessment of green energy potential.