Organized by the IWPR Central Asia Office, an International Expert Meeting entitled “Unlocking Central Asia’s Infrastructure and Energy Potential” took place in early August.
According to the organizers, the main goal of this expert discussion was to address the slow progress and challenges hindering infrastructure and energy project development.
CABAr.asia says the moderator Mr. Eldaniz Guseinov, a European and international studies specialist at the Heartland Expert Analytical Center, stated that Central Asia has great potential to
Dr. Theresa Sabonis-Helf, the first chair of the Department of Science, Technology and International Affairs in the Master’s Program at Georgetown University School of Business, noted that Central Asia is currently facing a second energy transition.
According to her, every country in the region now has more installed capacity and a greater ability to generate electricity than in 1991.
As of 2020, the price of electricity in most Central Asian countries has approached cost recovery, Dr. Sabonis-Helf noted.
However, there are reportedly two significant causes for concern: 1) the per capita consumption of electricity in Central Asia is still lower than the average of developed countries; and 2) every country anticipates a surge in demand.
In fact, the Asian Development Bank (ADB) projects that by 2030, energy demand in the region will increase by 30 percent, with a majority of that growth occurring in the realm of electricity.
This combination of factors, encompassing both increased demand and the growing unreliability of supply from hydroelectric sources, has reprotedly led to a complex challenge. Historically, the power system in Central Asia was designed to strike a balance by employing various energy sources according to the seasons.
During the Soviet era, regional trade and electricity exchange were orchestrated to utilize more hydropower from Kyrgyzstan and Tajikistan during times of abundant water availability, while the winter months saw the utilization of fossil fuel resources concentrated in Kazakhstan, Uzbekistan, and Turkmenistan for heating and lighting purposes.
Nonetheless, the power system started to deteriorate in 2000, was shut down in 2008, and was not fully reinstated until 2018.
Currently, according to Theresa Sabonis-Helf, only about 40 per cent of the available capacity in the region is being utilized.
She noted that the potential for nuclear power deserves consideration, particularly given Kazakhstan and Uzbekistan’s substantial uranium reserves.
Theresa Sabonis-Helf also suggested drawing attention to the need for effective regulation and governance of energy-intensive sectors such as bitcoin, given China’s total ban on cryptocurrencies.
Effectively regulating and managing such energy-demanding sectors, like Bitcoin, is reportedly pivotal for a well-functioning regional energy system.
Dr. Farhod Aminjonov, a professor at the National Defense College of Abu Dhabi said that the capacity of the Central Asian energy system is relatively limited for three reasons: 1) inadequate planning; 2) limited involvement of local countries; and 3) an unattractive business climate.
He questioned whether the Central Asian countries would be able to improve the investment climate in the short to medium term.
According to Aminjonov, Kazakhstan is way ahead of others, but for the most part, the technology and expertise required for diversification often come from external sources.
He noted that in fact most renewable energy facilities are built by foreign investors.
He mentioned the example of Uzbekistan, where agreements worth tens of billions of dollars have been signed with Gulf countries on the construction of solar and wind energy facilities.
It’s very important that Central Asian countries develop a comprehensive roadmap of what needs to be done, Aminjonov noted.
At the same time, he said, countries should not use a one-size-fits-all strategy.
“…if you…compare studies done for Uzbekistan, Kazakhstan, and Tajikistan, they are all the same recommendations… I think, in a Central Asian context, separate roadmaps have to be developed for each country specifically,” Aminjonov noted.
Second, according to him, feasible plans for energy transition and modernization of energy infrastructure need to be developed.
Farhod Aminjonov also questioned whether Uzbekistan’s ambition to increase the share of renewable energy sources in the total energy balance to 8 gigawatts by 2030 could be achieved.
“Third, work with inconvenient partners on inconvenient projects,” Aminjonov suggests.
According to him, the region is often tempted by easy loans from foreign partners who promise to build everything at a very low cost.
Farhod Aminjonov also emphasized that it is vital to gain the trust of the public.
Source: Asia Plus