Integration Central Asia into the World Economy : The Role of Infrastructure and Energy

1. Integration Central Asia into the World Economy: The Role of Infrastructure and Energy • Electrical Energy of Kyrgyzstan • (current situation, problems, prospects) • Doctor of technical sciencesprof., • Obozov A. D. • October, 22-23, Washington, 2007

2. Brief information on Kyrgyzstan Geographical position – 39-43 d.w. Population – urban 40% Territory – 200 thousand sq.km, – rural 60% 95%-mountains Population – 5 million Borders with: Uzbekistan, Density of population 20 persons\sq.km Tajikistan, Kazakhstan, China

4. Fuel-Energy Complex of Kyrgyz Republic StocksProduction Consumption COAL 2317 bln.t 538 th.t 1250 th.t OIL 4700 mln.м2. 24.mln.м2. 960 mln.м2. HYDRO 162,7 bln.kw.h. 12,6 bln.kw.h. 9,085 bln.kw.h.

5. 18 power plants16 – Hydro 2 –Thermal power plants (Bishkek, Osh)Installed capacity – 3523 MWTransmission Lines – 35-500 kWOver 10 thousand kmTransmission Lines – 10 и 0,4 kW 2 thousand kmOutput of electrical energy – 13-14 milliard kW/hProvision of population – 95% of electrical energyReserve of hydro energyIs used only 10% of hydro potential Electrical Energy of Kyrgyzstan:

6. SCHEME OF THE MAIN ELECTRICAL ENERGY SYSTEM OF THE KYRGYZ REPUBLIC

7. High–voltagetransmission lines

8. Electrical sub-stations

9. Dynamics of the level of system losses of electrical energy(1996 - 2007) 50% 40% 30% 20% 10% 0% 43% 43% 42% 42% 41% 43% 42% 34% 40% 28% 37% 32% 1996 1997 1998 1999 2000 2001 200 2003 2004 2005 2007 1 п/г

10. Comparison of lagging behind of the real level from the necessary level in the NIS 5 5 5 4,1 4,1 3,8 4 4 3,5 3,7 3,7 3,1 3 2,3 2,3 2,1 2 1,2 Cent/kvт 1 1 0,4 0 Армения Turkish Азербайджан Tajikistan Uzbekistan Украина Kyrgyzstan Moldova Necessary tariff Real tariff

11. Growth of debts РЭКов Mln. soms by 1.07.2001 2500 2000 1500 1000 500 0% by 31.12.2006 2286,4 Total debtto 31.12.2006 is 3′354 mln soms 712,3 572,8 245,1 188,9 178,1 165,7 166,5 Industrial consumers Rural consumers Jthers Population

12. Форма собственности и обязанности главных энергетических предприятий Кыргызской Республики. Prospects of electrical energy sector of Kyrgyzstan It is possible to construct on the river Naryn Hydro Power Plant (HEP)with the power 6450 MW with the output over 22 milliard kW KambarataHPP – 2 Power – 360MW Output – 1,148milliard kW/h Cost - 240million$ KambarataHPP – 1 Power – 1900 MW Output – 5,1 milliard kW/h Cost - 1,7 milliard$ Transmission Line – 500 kW for export Length 1300 km Cost 700 млн. $

13. Weak management Low level of payments KFD Old equipment High level of losses Tariffs are lower of the necessary expenses Politically and socially dependent problem Cause of crisis in electrical energy sector of the Kyrgyz Republic

14. KFDexert unfavorable impact on the growth and macroeconomic stability of the • country : • - Cause low collection of taxes into the country’s budget because of the inefficient activity of energy companies; • Accordingly, the state expenses on salary, social expenses and social investments financed from the budget of the country are reduced; • Misrepresent the relative electrical energy prices , bringing down the stimulus to energy saving; • Keep impracticable enterprises, so suppressing conducting of restructuring of enterprises and reducing economic growth of efficiency; • Misrepresent resources distribution by suppressing resources in energy consuming industries; • Aggravate financial discipline in state structures making weaker efficiency of fiscal policy

15. Thank you for attention!!!