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 KAZAKHSTAN International Business Magazine №3, 2006
 Sun, Air and Water…Alternatives to Traditional Power-engineering in Kazakhstan
Sun, Air and Water…
Alternatives to Traditional Power-engineering in Kazakhstan
According to foreign experts, by 2030 wind, solar and hydro-power will provide 15%, 10% and 9%, respectively, of the world’s total power generation. We asked UN programme experts Gennady Doroshin and Peter Dixon to tell us about the prospects for developing renewable and alternative power-engineering in Kazakhstan.
What is the share of traditional energy sources in Kazakhstan’s energy balance?
Gennady Doroshin: Traditional energy sources based on fossil fuel account for the bulk of the world’s total power-engineering at the moment, and Kazakhstan’s power-engineering is no exception.
The country has vast reserves of traditional energy resources (0.5% of the world’s total reserves); it has them for the long-term future and this has huge export potential.
Coal thermal power plants are the main source of power generation and heating in Kazakhstan, and their design capacity accounts for about 85% of the total power generating capacity, hydroelectric stations account for 12% and gas power plants 3%.
However, the centralised system of power supply with the main generating capacities concentrated in several major coal power plants in central Kazakhstan and power lines with a total length of about 450,000 km lead to significant losses of electricity during distribution, and significant operating costs. This also increases the total expenditure on power supply and the volumes of fuel consumed by power plants.
The ratio of energy consumption to GDP in Kazakhstan is significantly higher than in developed countries and shows the energy intensity of its economy. For example, according to International Energy Agency statistics for 2003, the energy intensity of the country’s GDP stood at 2 tonnes of oil equivalent per $1,000, whereas this ratio was 0.19 tonnes of oil equivalent per $1,000 in Organisation for Economic Cooperation and Development states.
According to the Kazakh Energy and Mineral Resources Ministry, the country is considering building wind farms with a combined capacity of over 1 million kWh in the country’s 46 regions by 2030. This project could add up to 40 MW of electricity to the regions’ energy balance.
The concentration of power generation in several power plants also poses a risk in terms of the reliability of power supply in regions which do not have their own power sources.
The answer to the question "how long will Kazakhstan use traditional energy sources?" depends on the fossil fuel reserves and the intensity with which they are used, including exports to foreign countries. Proven oil and gas reserves may be enough for decades and coal reserves for centuries.
A restriction on expanding the use of traditional energy resources, above all coal, could be required in order to reduce the negative impact by traditional power-engineering on the environment, including reducing the emission of greenhouse gases, which have an impact on global climate change.
Does our country have the possibility of using renewable energy sources?
Gennady Doroshin: Kazakhstan has great potential in renewable energy sources, such as hydro, wind and solar energy, which are enough to meet a significant part of the need for energy resources.
For example, given that the total potential of hydro resources stands at 170 billion kWh in the country, it would be economically feasible to use about 30 billion kWh. However, Kazakh hydroelectric power stations generate only 8 billion kWh, i.e. less than 30% of the economically-feasible potential.
Another promising type of power-engineering is wind energy. As a country which is located in the northern hemisphere’s wind belt, Kazakhstan theoretically has wind energy potential standing at 1,820 billion kWh. Wind farm capacity in the Dzhungarian Gates region (in Almaty Oblast) alone could reach 1,000 MW, which is about 3 billion kWh of power per year. This means that it is possible not simply to meet the growing demand for power in southern Kazakhstan, but to export it too.
Kazakhstan also has great opportunities to develop solar power, especially in the country’s south and southeast. The number of sunshine hours reaches 2,200-2,300 hours a year, and the annual level of solar radiation is 1,300-1,800 W per sq.m. Solar elements can be widely used as heating and to heat water, which would save fuel and reduce environmental pollution.
In general, the potential of hydro and solar energy is scarcely used in our country. Renewable energy sources account for less than 2% of the country’s current fuel and energy.
What are your arguments in favour of renewable energy sources?
Peter Dixon: Today, renewable energy sources are the most dynamically developing form of power generation. Annual global growth exceeds 10% and, according to forecasts, this trend will persist in the future too.
Leaders in terms of generating alternative electricity (by the total capacity of the existing facilities of renewable energy sources) are the EU, the USA, China and India.
In addition, world demand for renewable energy sources is growing constantly. By the mid-21st century, their share in the global energy balance is expected to grow to 35%.
The attractiveness of renewable energy sources is linked to the fact that these resources are inexhaustible, do not depend on world energy prices and are environmentally clean. The latter argument is particularly important because traditional power-engineering has a negative impact on the environment on both the local and global scale.
Enterprises in Kazakhstan’s power-engineering sector are currently the largest air polluters. They annually emit over 1 million tonnes of toxic substances and 70 million tonnes of carbon dioxide into the air. According to the International Energy Agency, Kazakhstan occupied third place in the world in terms of greenhouse gas emissions to GDP (6.11 kg per 1$ of GDP). Estimated economic damage from environmental pollution by coal power-engineering alone totals about $3.4bn a year in Kazakhstan. Ignoring renewable energy sources and the centralisation of power supply leads, then, to the irrational use of energy sources and the reduction of the efficiency and reliability of the power supply, and causes considerable damage to the environment and people’s health.
Another argument in favour of renewable energy sources is the inefficiency of centralising the power supply when Kazakhstan has a huge territory (2.7 million and low density (5.5 people per because this leads to significant losses while transporting power to remote consumers. Using renewable power-engineering could reduce expenses in supplying power to remote settlements and in constructing power lines.
What hampers the widespread use of renewable energy sources in our country?
Gennady Doroshin: The fact is that the Kazakh legislative base in the energy sphere is aimed at "traditional" power-engineering. It barely reflects issues relating to regulating renewable energy sources, which is one of the main obstacles to developing these sources in Kazakhstan. Renewable energy sources have to compete in the power market, where the cost of electricity is defined in essence only by operational expenses to produce it. In this situation, not only is investing in renewable energy sources unprofitable; so is modernising traditional power sources. This leads to a situation in which increasing the efficiency of using energy resources and protecting the environment are not profitable. Demand for developments by Kazakh scientists in the sphere of renewable energy sources is not created either.
Peter Dixon: A factor such as a lack of knowledge in this sphere among government officials responsible for developing this aspect of Kazakh power-engineering also prevents the use of renewable energy sources. In addition, this is torpedoed by hidden subsidies to traditional power-engineering and this in turn hinders the economic feasibility of renewable energy sources, deprives renewable energy source projects of large investment and state support and, as a result, generates no interest from the investment community and development institutions.
How do you think the state should help renewable energy sources?
Peter Dixon: If we discuss international experience, then we can see that many countries have large-scale programmes to develop renewable energy sources. For example, the EU has adopted a programme to increase the share of renewable energy sources in the EU’s energy balance to 12% by 2010.
In addition to state programmes setting targets for commissioning generating capacities based on renewable energy sources, this sector of power-engineering is also supported by legislative acts which ensure its attractiveness for investment. For example, a number of countries are successfully applying tariffs and quotas set for buying power produced by renewable energy sources. A form of supporting renewable energy sources such as setting quotas using so-called green certificates is also working effectively. Its essence is that wholesale buyers should either buy a certain amount of alternative power or pay compensation through buying these certificates.
Gennady Doroshin: Only support and attention from the state will in many respects predetermine the success of renewable energy sources in Kazakhstan through employing scientific, industrial and financial potential to develop this sector of power-engineering.
Kazakhstan’s government bodies have now recognised the need to use renewable energy sources in the country. The Blueprint of Power-Engineering Development has been adopted. In addition, the country’s government and the UNDP are working on a project to develop wind power in Kazakhstan, which, for example, plans to build a pilot wind farm with a capacity of 5 MW in the Dzhungarian Gates region. The REEP programme also helps draft necessary legislation.
Peter Dixon
Energy sources of traditional power-engineering (oil, gas and coal) currently account for about 74% of the global energy balance. At current consumption rates existing oil reserves are sufficient for 40 years, gas for 56 years and coal for 197 years. Renewable energy sources (mostly biomass and hydro-power) account for 19.5% and nuclear power 6.3%.
Gennady Doroshin
Renewable energy sources, in the form of hydro and wind energy, should be used widely for commercial power generation. Solar energy can be used for heating water and in some cases for autonomous power supply.

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