76 MWp Solar Power Plant in Kazakhstan Secured USD 42.6 million Financing Package from EBRD, GCF and CIF
/18th September 2020, EBRD, RENEWABLE MARKET WATCHTM/ The EBRD is organising new financing for the construction of a 76MWp solar plant in the Karaganda region of Kazakhstan, a leader in the development of renewable energy in Central Asia, with a total installed solar capacity of 216MWp. The US$ 42.6 million package provided to the well-established German developer Joachim Goldbeck Holding GmbH will consist of an EBRD local currency loan of up to US$ 28 million (Kazakh tenge equivalent), a concessional loan of up to US$ 11.5 million provided by the Green Climate Fund (GCF), the world’s largest climate fund and a concessional loan of up to US$ 3.1 million provided by the Climate Investment Funds’ Clean Technology Fund (CTF). The new solar plant will help reduce annual CO2 emissions by more than 80,000 tonnes and contribute to meeting Kazakhstan’s national emission reduction targets as well as the EBRD’s Green Economy Transition strategy.
Up to one-third of the plant’s installed capacity, will employ bifacial solar modules able to produce solar power from both sides of the panel and will be among the first completed renewable energy source projects in Kazakhstan under an auction scheme, a system supported by the EBRD to promote competitive pricing and stimulate investments into renewables.
The Karaganda Solar Project will support Kazakhstan in its objective to increase the share of renewable energy in the energy mix and will contribute to achieving the Kazakhstan government's goal of renewable energy source sector (apart from large hydro) accounting for 3 per cent all power generation by 2020 (10 per cent by 2030).
The investment takes place under the Bank’s €500 million Kazakhstan Renewables Framework, established in 2016 and extended in 2019, to help the country respond to the challenges of climate change, increase investments in renewables, provide technical assistance and build institutional capacity. Previously, the EBRD financed the 100MWp Saran solar power plant, which was also developed by the Joachim Goldbeck Holding GmbH, and is the largest solar power plant built at one time in Central Asia. To date, the EBRD has invested over €8.63 billion through 273 projects in the economy of Kazakhstan.
Current Economic Situation in the Republic of Kazakhstan
Kazakhstan is ranked 25th for Ease of Doing Business in the World Bank’s Doing Business 2020 report. The country has moved up three positions compared with the previous year. Investors prioritize Kazakhstan's strong fundamentals as its most attractive feature. Beyond Kazakhstan’s political, social and macroeconomic stability, they highlight its telecommunications infrastructure and corporate taxation as most attractive. However, the country’s critical weaknesses are found in its innovation capacity as well as the transparency and predictability of its business environment. Foreign direct investment (FDI) inflows into Kazakhstan have been strong in recent decades. Kazakhstan’s success in attracting FDI may be attributed to its vast natural resources and the commitment of the country’s leadership to welcoming FDI and promoting the country’s stable economic growth, as well as to developing non-extractive sectors such as agriculture, renewable energy, infrastructure, logistics, and transport. In 2018, Kazakhstan posted a gross FDI inflow of US$24,263 million.
Future Renewable Energy Market Trends
In the past few years there has been a steady decline in prices for clean electricity, that is, generated by renewable energy sources. And this is no coincidence. The lowering of prices for renewable energy sources is primarily promoted by the growing price competitiveness of technologies using renewable energy sources, political initiatives conducive to the development of this sector, and more open access to financing. As a result, new renewable energy power plants are emerging in all regions of the world.
As the country progresses in its pursuit of the green economy, the future of Kazakhstan’s renewable energy sector is promising. Dynamic development of the renewable energy capacity in the next decade is expected in the country, according to the research department of Renewable Market Watch™. In 2020, it is planned another 18 renewable energy power plants with a total capacity of 605.5 MW to be commissioned in Kazakhstan. According to the forecasts for 2020, the generation of renewable energy will amount to about 3 billion kWh of electricity. International auctions were held in 2019 in electronic format for renewable energy projects with a total capacity of 255 MW. As a result of the auction, 12 companies signed contracts for the sale of electricity with a Financial Settlement Centre (FSC) for 15 years for a total capacity of 202 MW.
In 2020, the adoption of the Law of the Republic of Kazakhstan “On Amendments and Additions to Certain Legislative Acts of the Republic of Kazakhstan on Support of the Use of Renewable Energy Sources and Electric Power Industry” is expected. The main conceptual innovations of the proposed draft law are the stimulation of the construction of manoeuvring capacities, the establishment of a through tariff to support renewable energy sources, the creation of favourable conditions for the development of renewable energy sources and an extension of the terms under PPA contracts (Power Purchase Agreements).
The more information about the financing of Karaganda Solar Project you may read here: EBRD, GCF and CIFs US$ 42.6 million for a solar plant in Kazakhstan
The more information about the solar power market in Kazakhstan including full contact details of solar project owners and developers you may read here: Kazakhstan Solar Photovoltaic (PV) Power Market Outlook 2020÷2030
The more information about the wind power market in Kazakhstan including full contact details of wind farm project owners and developers you may read here: Kazakhstan Wind Power Market Outlook 2020÷2030
In order to download the executive summary brochure with sample pages, please access from here: Kazakhstan Solar Photovoltaic (PV) Power Market Outlook 2020÷2030 - Sample
In order to download the executive summary brochure with sample pages, please access from here: Kazakhstan Wind Power Market Outlook 2020÷2030 - Sample
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