Renewable Energy “Key” for Uzbekistan: Interview with IFC Regional Manager

Neil McKain, the IFC regional manager for Uzbekistan and Turkmenistan, says renewable energy sources are helping Uzbekistan reduce natural gas consumption. The country can become a regional leader in renewable energy sources, he told The Times of Central Asia in an interview.   ТСА: To begin, could you give us an overview of the current state of renewable energy in Uzbekistan? Neil McKain: Uzbekistan has significant renewable energy potential — primarily solar and wind — and is well equipped to fulfill its growing energy needs and transition to a clean energy economy. Renewable energy can help diversify the energy mix and reduce the country’s heavy reliance on natural gas. The government is focused on increasing the share of renewables in power production by up to 25 GW, or 40% of the country’s overall electricity consumption, by 2030. These efforts support the country's clean energy transition and address the increasing demand for energy in Uzbekistan’s economy and among its citizens. In this context, the World Bank Group is helping Uzbekistan develop 1,000 MW of solar and 500 MW of wind energy by attracting private sector investments.   ТСА: With these developments, what challenges does Uzbekistan face in transitioning to renewable energy? McKain: Like many countries, Uzbekistan faces many challenges as it transitions. The government has substantial natural gas reserves, and the economy relies heavily on fossil fuels. Transitioning away from these energy sources can be economically and politically challenging. It requires building public support and raising awareness of the many benefits of renewable energy. In addition, building the necessary infrastructure, such as solar farms, wind turbines, and an updated electrical grid, requires significant investment, time, and technical expertise. As renewable energy sources are intermittent, developing efficient energy storage solutions will be vital to ensuring a stable energy supply. Also, securing the required capital can take time, as it often involves enormous upfront costs and long-term investment before seeing returns. Addressing these multifaceted challenges will require coordinated efforts from the government, private sector, and international partners.   ТСА: What is the IFC's involvement in renewable energy projects in Uzbekistan? McKain: The IFC is deeply committed to supporting renewable energy in emerging markets, and Uzbekistan is a key country. We've been involved in several initiatives, including advising on and financing solar power projects. One of our first projects is a solar plant in the Navoi region, which provides electricity to 31,000 homes. This project was established through a public-private partnership (PPP) between the Uzbek government and Masdar, the United Arab Emirates’ flagship renewable energy company. IFC assisted the government as a transaction adviser in designing and tendering the PPP under its Scaling Solar Program. It is now a significant milestone in the country's renewable energy journey. In collaborationwith other lenders, IFC also provided a financing package to support the construction of a 500-megawatt wind farm in the Navoi region, which Masdar is also building. Capable of powering 500,000 homes, it will be the largest facility in Central Asia—and, incidentally, the largest wind farm IFC has ever sponsored. Together with our state and...