Access to a reliable electricity supply is a prerequisite for economic and industrial development, which in turn creates more demand for power. To meet the increasing need for electricity from the industry sector and households, Kazakhstan has embarked on an ambitious agenda to upgrade its existing generation and transmission infrastructure, and to support it with new facilities in 2012. Large, multinational companies are paving the way for this initiative, as many of the world’s finest power generation enterprises see opportunities in Kazakhstan. “Energy is not only oil and gas,” as Kay Zwingenberger, President and CEO of Kazakhstan and Central Asia for Siemens Kazakhstan, sees it. “There is an entire spectrum of power generation, starting with power plants, which include high-efficiency gas-fired combined cycle, hydropower, wind power, and solar power.” Possibilities beyond the various power generation techniques also exist, as the power must then be transported safely and efficiently.
Following its independence, Kazakhstan aggressively restructured the country’s power sector, which resulted in the privatization of 85% of the country’s generating capacity. Established in 1996, the Kazakhstan Electricity Grid Operating Company (KEGOC) is the national transmission grid operator of the country. Currently, 100% of the company’s shares belong to the National Welfare Fund, Samruk-Kazyna.
The majority of the country’s power is generated by hydroelectric and thermal power plants. The Bukhtarma, Kapshagay, Shulbinsk, and Ust-Kamenogorsk hydroelectric plants provide an aggregate annual capacity of 2,131 MW. In addition, the AES-Ekibastuz and Ekibastuz GRES-2 thermal power stations operate with an annual capacity of 5,000 MW. With more than 18 GW of total installed capacity, each plant in the country features a variety of automation levels. However, power generation companies still see room for improvement as they focus on the modernization of outdated infrastructure. Andrey Tyan, General Director of Emerson Kazakhstan, told TBY that “There are a number of new facilities and projects on the horizon, but there are still many power plants built in the Soviet era that are 30 to 40 years old and need to be modernized.” In the coming years, Kazakhstan can expect to see the construction of new plants and the revitalization of older facilities.
The transmission and distribution infrastructure comprises three separate networks that are integrated into neighboring systems. While the northwest of the country is connected to the Russian network, the north and south are also a part of the Siberian and Kazakh-Kyrgyz-Uzbek joint networks.
Electricity consumption and generation in Kazakhstan is expected to grow annually around 5% and 4.5%, respectively, until 2021. The government foresees that generating capacity will reach 150 TWh by 2030, while demand will reach 145 TWh over the same period. Kazakhstan is investing in a wide spectrum of resources including coal, nuclear, and renewable resources to meet the country’s future power needs. The country is also investing in preventing losses in transmission lines, which, can reach up to 15% in certain instances.KEGOC’s long-term investment strategy entails investments in several projects totaling $3.6 billion by 2025. These initiatives include the rehabilitation of substations, transmission lines, and other equipment, the building of a new substation near Almaty, and the installation of power lines to the Moinak power plant located south of Almaty. The national company also has plans to build a new north-south power line across the country, as well as to connect Uralsk, Atyrau, and Mangystau to the national grid. The expansion of the Ekibastuz GRES-2 coal power station, the construction of a new thermal power station near Lake Balkash, and the modernization of the Moinak hydropower plants are among the country’s largest projects. In terms of nuclear energy, Kazakhstan is looking into building its first nuclear power plant in cooperation with Russia in the western region of Mangystau. Furthermore, either the government or Samruk-Kazyna will fund around 30% of the investment.
As the country is seeking ways to expand and diversify the power generation segment, the energy sector is becoming more open to foreign participation and more attractive for investors. In line with these trends, the authorities have also planned the creation of a wholesale electricity market, which will generate revenues for the country for the coming
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