Afghanistan finalizes a $10 billion agreement for generating 10,000 MW of electricity
The Taliban administration in Afghanistan has secured a groundbreaking $10 billion deal with the Azizi Energy Private Company, marking one of the largest investments since the Taliban took power in 2021. Signed on August 2, 2025, this memorandum of understanding (MoU) aims to revolutionise Afghanistan's energy sector over the next decade[1][2][3][4].
Key Highlights
Timeline and Implementation
The project design phase is expected to be completed within six months from signing, with implementation beginning around August 3, 2025. The deal envisions achieving full electricity self-sufficiency for Afghanistan within 7 to 10 years, with subsequent capability for electricity exports to neighboring countries[1][2][3].
Diverse Energy Sources
Azizi Energy will utilise a diversified mix of energy inputs, including gas, coal, hydropower (water), wind, and solar energy across different regions of Afghanistan to reach the 10,000 megawatt (MW) target[1][2][3][4].
Phased Development
The initial phase will launch projects generating between 2,000 and 3,000 MW of electricity, with a longer-term goal to expand up to the full 10,000 MW capacity[1][2].
Economic Impact
According to the Taliban’s Deputy Prime Minister for Economic Affairs office, the deal will not only secure Afghanistan’s energy self-sufficiency but also enable exports abroad, supporting regional energy needs. It is expected to create millions of jobs and potentially lead to the establishment of thousands of factories, thus significantly contributing to Afghanistan’s economic development and reduced energy import dependence[1][3][4].
Current Energy Scenario
Currently, Afghanistan faces severe electricity shortages, with only about 40% of the population having access to power. The country imports over 70% of its electricity mainly from neighbouring countries like Uzbekistan, Tajikistan, Turkmenistan, and Iran, whose supplies are often unstable[3].
Uncertainties
While Mirwais Azizi and Azizi Group have pledged significant investments since 2021, including this deal, none of the previous large-scale projects have materialised yet, raising questions about the execution success of this plan[3].
In conclusion, this $10 billion deal aims to transform Afghanistan's electricity sector over the next decade by harnessing multiple domestic energy sources, achieving energy independence, creating jobs for millions, and enabling electricity export to other countries in the region[1][2][3][4]. With the initial phase set to commence soon, the future of Afghanistan's energy landscape looks promising.
- The energy sector transformation in Afghanistan, as a result of the $10 billion deal with Azizi Energy Private Company, is projected to have a significant impact on the local finance sector, as the project promises to create millions of jobs and establish thousands of factories, thereby boosting the economy and reducing energy import dependence.
- Under the Azizi Energy's vision for Afghanistan's energy sector, the diverse mix of energy inputs, including gas, coal, hydropower, wind, and solar energy, will not only help achieve energy self-sufficiency but also open up opportunities for exporting electricity to neighboring countries, thereby becoming a substantial player in the regional energy industry.
