Kyrgyzstan consumes more electricity, builds no new generating facilities

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BISHKEK (TCA) — If the country lacks generation capacity it is necessary to increase electricity import, Kyrgyzstan Prime Minister Temir Sariyev said on February 26 at the Government meeting to consider an anti-crisis program developed by the Economy Ministry and measures to support business in the current difficult economic conditions.

According to the head of the National Energy Holding Company Aibek Kaliev, the available power generation capacity is not enough to meet the needs of business for electricity. The Energy Holding can now allocate 60 megawatts only to entrepreneurs for industrial needs.

It is necessary to undertake urgent actions, the Prime Minister said. If the Energy Holding cannot provide business with domestic electricity, it should import it, because without electricity production will stop. Entrepreneurs are willing to pay for electricity, they are asking for permission to construct new buildings, but the Energy Holding limits their power consumption.

The Prime Minister suggested that new buildings use gas for heating and build coal-fired boilers. In some regions coal is readily available, but the population heats homes with electricity.

Last year, the Government tasked power distribution companies to reduce losses in the energy sector down to 14%, as well as reduce corruption, but these tasks have not been duly fulfilled. The distribution companies have also failed to install “smart” electricity meters in the regions and ensure transparency in public procurement.

The Prime Minister tasked to reduce the electricity losses in the distribution companies to 12.5%.

Energy deficit

According to the Economy Ministry, electricity consumption has been growing by 10% annually since 2012 in Bishkek, but no new generation facilities have been built during this time.

Even if the reservoir of the country’s largest Toktogul hydro power plant is full, there is no guarantee that Kyrgyzstan will do without electricity imports. The country has turned from an exporter to an importer of electricity.

The situation is serious, and the Government’s decision to allocate more electricity to businesses will not solve the problem. If the country cannot increase its electricity generation, it should reduce losses by reconstructing the existing power networks and replacing old transformers and cables.

A breakthrough is expected in 2017 with the reconstruction of the Bishkek thermoelectric power plant, which will generate an additional 300 megawatts.

A new 500kV power transmission line was launched in August 2015, joining the north and south of the country. With its construction, Kyrgyzstan’s own internal power ring was created to ensure the country’s energy independence. Now Kyrgyzstan is not dependent on the transit of electricity through Kazakhstan.

As a result, the energy security of the northern Chui valley, especially in the capital Bishkek, has been more or less normalized. Power outages decreased by 30% in 2015 compared to 2014.

Investments

Currently, 12 small hydro power plants operate in Kyrgyzstan, while it is possible to build about 100 small hydro plants with a capacity of 180 MW. The country uses no more than 10% its hydro power resources and about 3% of the hydro power potential of small rivers.

A private domestic investor has begun construction of a small hydropower plant with a capacity of 0.6 MW in the Batken province in the south of the country. The hydropower sector lacks foreign investment due to the risk of non-repayment of invested funds due to low electricity tariffs and the lack of regulatory framework, expert Elena Rodina said.

The UNDP project for the development of small hydropower plant aims to accelerate the process of sustainable power generation by small hydropower plants by attracting investment in the private sector. Among the achievements of the project is the introduction of amendments to the law on renewable energy sources (RES). An eight-year grace payback period for RES and multipliers for the purchase of electricity from renewable energy distribution companies has been introduced. In addition, the law provides for compulsory purchase of electricity produced by RES by distribution companies.

The Ministry of Economy has to further improve the legislation to ensure a favorable investment climate for the RES development.