Energy Investment Urged for Southern Kazakstan

Analysts say huge infrastructure investments are needed in the southern Kazak energy sector to help alleviate the supply crisis and large bills faced by many there.



Almaty residents last week told Prime Minister Danial Ahmetov that those in the southern regions pay too much for electricity and complained that the ministry of energy and mineral resources has allocated quotas for cheap electricity to industrial enterprises like Kazphosphat.



Central regions are not suffering shortages, because of good supply from the Ust-Kamenogorsk, Shulbin and Bukhtarmin hydroelectric stations, which also provide some energy to the south.



NBCentralAsia economic analyst Petr Svoik blames the problems in the south on the creaking infrastructure in the region, which he says has reached its capacity.



He also attributes the energy deficit to the region’s Djambyl station, which operates on expensive fuel oil rather than the cheap Uzbek natural gas it used during the Soviet era. “Energy generated on fuel oil is like gold. This is the reason why prices on electricity rise,” said Svoik.



Svoik says the government must make infrastructure investments to alleviate the current problems, an opinion shared by economic expert Kanat Bazarbaev. He says increasing tariffs is not the answer and only a coherent investment policy to construct new transmission lines and power stations will improve the situation.



“The question is here not only how to regulate energy tariffs but how to invest in the development of energy grid,” said Bazarbaev. “Massive investments are needed here aimed at complete renovation of energy grid.”



(News Briefing Central Asia draws comment and analysis from a broad range of political observers across the region)