Russia Holds Kyrgyzstan's Hydropower Dreams Hostage
Summer is supposed to be the one season when people in Kyrgyzstan can forget about electricity shortages. But this year, it seems, summer will bring no respite, as the government has announced it will import electricity from Tajikistan.
A water shortage is behind the summer deficit; some experts attribute it to climate change. By importing electricity now, authorities hope to keep reservoirs well stocked for the upcoming winter, when electricity demand triples. The May announcement to import up to 500 million kWh in the summer underscores the fragility of a system that has seen little meaningful reform and little investment, despite constant promises of both in recent years.
Demand for electricity is growing by 4 percent annually, while private citizens consume 67 percent of the total, says Nurzat Abdyrasulova, director of UNISON, an energy-transparency watchdog. “There’s very little left for industrial use,” Abdyrasulova told EurasiaNet.org, describing the negative impact that shortage has on economic growth.
Abdyrasulova says Bishkek must take more proactive steps to create a sustainable energy program; introducing a clear policy on tariffs, addressing issues like sustainable energy use, and looking at alternatives like solar or wind energy, instead of solely relying on hydropower: “They’re acting like firefighters, reacting to a problem instead of taking measures to prevent it,” she said of the summer imports.
Kyrgyzstan’s Energy Ministry did not reply to repeated requests for comment over several weeks after insisting on questions in writing. But from drips and drabs leaking out over the years, it is clear that authorities are focusing on large infrastructure projects, some of which have been on the drawing board since the Soviet era.
Last year, with support from Russia’s state-owned RusHydro, Kyrgyzstan began building the $727-million Upper Naryn Cascade of four hydropower dams with a capacity of 240 megawatts (MW). The project is supposed to be finished by 2019, though the first station will come online in 2016, said a spokesman for RusHydro. RusHydro will receive 75 percent of profits until the project breaks even, and then will split proceeds 50-50 with the Kyrgyz state.
Another project on the drawing board since the 1980s is the ambitious, 1900-MW Kambar-Ata 1. At 275 meters, it would be the tallest dam in Kyrgyzstan. Russian politicians keep promising to build it, but little has happened.
Together the two would add 2,140 MW of capacity to Kyrgyzstan’s current output, as defined by the government, of 3,800 MW—a (still very theoretical) 78 percent increase.
The idea for Kambar-Ata 1 came back to life in 2009 under then-president Kurmanbek Bakiyev, to whom Russia promised $1.7 billion in financing. Most analysts believe Moscow had, in exchange, demanded Bakiyev shut the American airbase at Manas. In the end, Bakiyev took some $450 million in aid, told the Americans they could stay if they paid more rent, and was overthrown the following year with tacit Kremlin approval. Russia never delivered the $1.7 billion credit.
Since President Almazbek Atambayev came to power in 2011, reports about new negotiations regularly appear in the Kyrgyz press, but Kambar-Ata 1 still appears to be in the dream stage. The project is not to be confused with the Kyrgyz-financed Kambar-Ata 2, where the first of three turbines opened in 2010, and which has been dogged by corruption allegations ever since.
Inter RAO, the Russian state-run company that was supposed to oversee Kambar-Ata 1’s construction, says the company is currently carrying out a feasibility study, and cannot discuss technical, economic issues or timing for now. “There are still many unresolved issues,” spokesman Nikolai Gorelov told EurasiaNet.org.
Few seem to believe the project will ever get off the ground. Bishkek-based energy analyst Ernest Karybekov, a former government advisor, believes Kambar-Ata is “not economically beneficial” and would push Kyrgyzstan, where public debt is almost 50 percent of GDP, deeper into a financial hole. Negotiations have dragged for so long that they suggest Russia is no longer interested in the project, Karybekov believes.
Unless “Russia has no better ways to spend its money,” the project is not going to happen any time soon, Karybekov said.
The on-again, off-again project highlights the Kremlin’s way of doing business in Central Asia, says political analyst Emil Juraev of the American University of Central Asia. “The political urgency that existed in the past is not there anymore,” he said.
Back in 2009, “Kyrgyzstan’s foreign policy orientation was up in the air, and Russia wasn’t sure if it had a secure rear,” Juraev told EurasiaNet.org. But now, with the Americans having left Manas this month and Kyrgyzstan joining the Russia-led Customs Union, “the Kremlin can delay its decision [on Kambar-Ata] for years,” Juraev said. “Russia has a lot of different priorities right now, and Kyrgyzstan is not the most important one.”
The focus on large projects like Kambar-Ata ignores more systemic problems in the energy sector, said Kanat Botbaev, a Kyrgyz-born, Brussels-based energy expert at the European Commission’s Energy Charter Secretariat. Without a strategy to increase efficiency and transparency in the opaque energy sector, “construction of such projects is like pouring water into a leaky bucket,” Botbaev told EurasiaNet.org by phone.
For now, with such limited production capacity, many in Bishkek are wondering why Kyrgyzstan has signed up to the World Bank-backed, $1.2 billion CASA-1000 electricity transmission system, which would move electricity from Kyrgyzstan and Tajikistan – another country with constant energy shortages – to Afghanistan and Pakistan. The Bank says CASA construction can begin next year.
The four countries have yet to determine pricing structures and Karybekov, the former government advisor, believes Kyrgyz electricity, after expensive projects such as Kambar-Ata and the Upper Naryn Cascade are factored in, will be too costly for South Asian customers. CASA-1000 needs Kyrgyzstan “like a cart needs a fifth wheel" – or not at all – Karybekov said.
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