Kazakhstan Power Report Q4 2012

Introduction

ABSTRACT

BMI View: Demand growth is healthy, reflecting economic expansion. Plans for new generating

capacity continue to focus on conventional thermal sources, with gas taking the lead thanks to the state's

substantial domestic resources. Asian influence is growing, with China and South Korea entering the

power arena as financiers of and contractors for generating facilities. However, Russia may emerge as

the partner of choice if Kazakhstan opts to bring nuclear capacity online.

In spite of Kazakhstan's vast gas reserves, the country's power industry is seeking to avoid

overdependence on the fuel in electricity generation and has a diversified policy involving coal,

hydropower and renewables. Nuclear has been side-lined, but may well emerge as a key component of the

power portfolio over the long term, thanks to huge uranium wealth. System losses are considerable and

improved efficiency could narrow the supply/demand gap. Ongoing high level investment in generation,

transmission and distribution infrastructure is therefore necessary, and foreign partners, largely from Asia

and Russia, are being lined up for the major projects.

The key trends and developments in the Kazakh electricity market are:

• Growth in Kazakh power consumption is forecast to average almost 4.3% per annum between

2012 and 2021. This reflects the relative immaturity of the energy market, with risk on the

upside as increased hydrocarbons-backed wealth stimulates the economy. Growth in power

generation is anticipated to average 4.2% per annum over the period, which may prove

insufficient to increase market coverage and ensure adequate supply, unless system losses can be

reduced greatly.

• According to government forecasts, the production of electricity will increase to 150.2 terrawatt

hours (TWh) by 2030 (broadly in line with BMI forecasts), with power demand rising to almost

145TWh over the same period. Existing investment plans in the power sector amount to

KZT1,147bn to 2015, with an estimated KZT9,500bn needed between 2012 and 2030. The share

of renewable resources in power generation is expected to rise by 11% by 2030.

• State grid operator Kazakhstan Electricity Grid Operating Company (KEGOC) has already

approved a long-term investment strategy, under which KZT530bn will be invested by 2025.

KEGOC has embarked upon several projects, including the rehabilitation of substations,

transmission lines and other equipment, as well as building a substation near Almaty and power

lines to the Moinak power plant. KEGOC is considering building a 500 kilovolt (kV) north-south

power line and transmission lines in order to connect the west Kazakh regions of Uralsk, Atyrau

and Mangystau to the national grid. Kazakhstan will probably delay its planned stake sale in

KEGOC until 2013, according to a March 2012 statement made by Bakytzhan Sagintayev, the

country's minister of trade and economic development.

Table of Contents

TABLE OF CONTENTS

• BMI Industry View

SWOT Analysis

• Kazakhstan Power SWOT
• Regional Overview

Industry Forecast Scenario

• Kazakhstan Snapshot (Macro)
• Table: Country Snapshot: Economic and Demographic Data, 2011-2021
• Table: Country Snapshot: Power Sector
• Kazakhstan Forecast Scenario
• Electricity Generation and Power Generating Capacity
• Table: Kazakhstan Total Electricity Generation Data And Forecasts, 2010-2016
• Table: Kazakhstan Total Electricity Generation Long-Term Forecasts, 2015-2021
• Table: Kazakhstan Electricity Generating Capacity Data And Forecasts, 2010-2016
• Table: Kazakhstan Electricity Generating Capacity Long-Term Forecasts, 2015-20121
• Electricity Consumption
• Table: Kazakhstan Total Electricity Consumption Data And Forecasts, 2010-2016
• Table: Kazakhstan Total Electricity Consumption Long-Term Forecasts, 2015-2021
• Transmission And Distribution, Imports And Exports
• Table: Kazakhstan Electric Power Transmission And Distribution Losses Data And Forecasts, 2010-2016
• Table: Kazakhstan Electric Power Transmission And Distribution Losses Long-Term Forecasts, 2015-2021
• Table: Kazakhstan Trade Data And Forecasts, 2010-2016
• Table: Kazakhstan Trade Long-Term Forecasts, 2015-2021
• Key Policies/Market Structure
• Regulation and Competition
• Pricing
• Key Projects Database
• Table: Key Projects
• Risk/Reward Ratings
• Central and Eastern Europe Regional Power Risk/Reward Ratings
• Table: CEE Power Risk/Reward Ratings (Scores Out Of 100)
• Kazakhstan's Power Risk/Reward Ratings
• Rewards
• Risks

Competitive Landscape

• KEGOC
• AES
• Glossary of Terms
• Table: Glossary of Terms
• Methodology And Sources
• Industry Forecasts
• Power Industry - Data Methodology
• Generation and Consumption Data
• Electricity Generation Capacity Data
• Power Risk/Reward Ratings Methodology

Kazakhstan Power Report Q4 2012

© Business Monitor International Ltd Page 4

• Table: Power Risk/Reward Indicators
• Sources

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