"Investment in return for tariff reduction" creates prospects for modernization
Keeping the Lights on in Kazakhstan: Modernizing the Energy Sector
The power's still on in Kazakhstan, thanks to ongoing investments under the revised "Tariff for Investment" program. This forward-thinking initiative aims to modernize the energy sector and ensure its sustainable growth.
In 2024, the country witnessed a surge in investments, facilitating timely repair and restoration work on power stations nationwide. Next year, investment volumes are expected to rise to an impressive 428 billion tenge, marking a 13.24% increase from the current level.
Key improvements include increasing the annual investment recovery limit and the maximum tariff for maintaining electrical power readiness. These changes pave the way for attracting private investments and large-scale technical upgrades.
The program brings energy-producing companies and the government together, with producers committed to increasing repair funds, updating equipment, and enhancing working conditions. This collaboration boosts the reliability and efficiency of the entire energy system.
Tariff adjustments under this program are strategic moves toward building a modern, reliable, and future-focused energy sector in Kazakhstan. Through long-term investment strategies, the country is strengthening its energy security and making a significant stride towards carbon neutrality by 2060.
Insights suggest a boost in investment and local procurement in 2025, with Q1 spending at 60.2% of total purchases in the sector. Major players, such as TCO and KPO, are collaborating closely with the government to increase Kazakhstani participation in procurement and investment, promoting local capabilities.
According to recent reports, the country's economy is growing steadily, and the focus on local procurement and investment remains a cornerstone of sector strategy. The government is also ensuring the digitization of tariff formation processes, fostering greater transparency and efficiency.
In conclusion, the energy sector in Kazakhstan is poised for growth, with the updated "Tariff for Investment" program playing a crucial role in attracting investments and ensuring the modernization and sustainable development of the sector.
The updated "Tariff for Investment" program is expected to attract substantial investments in the energy sector next year, with a planned 428 billion tenge, a 13.24% increase from the current level. This surge in finance will facilitate large-scale technical upgrades and improvements within the industry, aiming to strengthen Kazakhstan's energy security and contribute to its carbon neutrality goals by 2060.
