Further tasks of energy reforms considered

The energy sector of Uzbekistan is being consistently reformed. In the first stage, the industry management system was changed. In recent years, 22 power plants have been commissioned, including in those regions where there was no generation before. For the first time, private capital is being attracted to electricity production.

Currently, the country’s energy capacity has reached 85 billion kilowatt-hours. Another 20 gigawatts of capacity are planned to be launched in the coming years. It is planned to create 9 gigawatts of generating capacity through $7 billion in private investment.

To meet the growing needs of a dynamically developing economy and population, it is necessary to increase the volume of electricity production to at least 120 billion kilowatt-hours. It is estimated that investments of $52 billion will be required to introduce new capacity and completely modernize networks.

Such large-scale investments cannot be made without the participation of the private sector. To increase the attractiveness of the industry for private investors, as international experience shows, it is first of all necessary to create an energy market with an open competitive environment.

These goals are defined in the Decree of the President of the Republic of Uzbekistan “On measures to carry out the next stage of reform in the energy sector” of September 28 this year.

According to the document, by 2026, it is planned to introduce a free wholesale market, which will be formed based on demand and supply of electricity. At the same time, it is necessary to formulate a regulatory framework, create a market infrastructure, digitalize the energy system to the grassroots level, and introduce SCADA that eliminates the human factor.

In many countries, these reforms took an average of 15 years. In Uzbekistan, it is planned to carry out this process in three stages and complete it by 2030.

In accordance with the decree, the Agency for Development and Regulation of the Energy Market was created, which is entrusted with the functions of an energy regulator.

At the presentation, Minister of Energy J. Mirzamakhmudov reported on the timing of the implementation of the measures provided for by the decree and the planned work in the sphere.

The Head of state gave specific instructions to responsible persons on developing the concept of power supply for the country. It is specifically stated that the primary condition for the transition to a free energy market is creating sufficient generating capacity in the country to satisfy the electricity demand fully.

The task has also been set to create a unified electricity trading platform, test it, and launch it by the end of 2024.

The President emphasized that in the process of liberalizing the energy market, it is necessary to strictly comply with the requirement to sell electricity to the population at a single price in all regions of the country until 2035, as well as the principle of social protection when setting tariffs.

It was noted that for the effective operation of the new system, it is necessary to pay special attention to three components – personnel training, ensuring the relationship of the industry with science, and digitalization. It was instructed to organize this comprehensive work both in the center and in the regions.

The Agency will be staffed with highly qualified specialists and foreign consultants in this regard. Employees will be sent for advanced training in Spain, China, Türkiye, and Germany. Based on foreign experience, training courses for engineers, dispatchers, SCADA system operators, and other specialists will be organized.

Industry leaders were given several tasks on the issues discussed at the presentation.