This spring, at the Qazaq Green site, the Ministry of Energy of the Republic of Kazakhstan discussed topical issues of the development of renewable energy in Kazakhstan with the participation of representatives of the association members: the business community, international, and financial organizations. Based on the results of these discussions, the Ministry launched draft amendments to a number of legal acts regulating the development of renewable energy sources.

The draft regulatory legal act “On Amendments and Additions to the Resolution of the Government of the Republic of Kazakhstan No. 271 dated March 27, 2014, “On Approval of the Rules for Determining Fixed Tariffs and Limit Auction Prices” involves the determination of Threshold Auction Prices at the level of fixed tariffs, approved by the Decree of the Government of the Republic of Kazakhstan No. 645 dated March 27, 2014. June 12, 2014.

-           SPP– 34.61 KZT/kW*h

-           WPP– 22.68 KZT/kW*h

-           BioPP – 32.23 KZT/kW*h

This initiative is in line with the instruction of the head of state dated March 2, 2022, regarding the improvement of the regulatory framework in order to stimulate large renewable energy projects.

At the same time, according to the LSI draft “On Amendments and Additions to the Decree of the Government of the Republic of Kazakhstan No. 645 dated June 12, 2014 “On Approval of Fixed Tariffs”, the Ministry of Energy of the Republic of Kazakhstan proposed to determine a fixed tariff for the hydrodynamic energy of water in the amount of 41.23 KZT/kW*h. Such a measure will stimulate investment activity at auctions for HPPs and is designed to overcome one of the main problems associated with the implementation of HPP projects - the low marginal auction price (15.2 KZT/kWh).

In addition, amendments to the Decree of the Government of the Republic of Kazakhstan No. 271 dated March 27, 2014 “On Approval of the Rules for Determining Fixed Tariffs and Threshold Auction Prices” involve a number of initiatives aimed at improving the indexation mechanism:

-           introduction of a one-time indexation for the construction period from the purchase agreement date and until the start of the electricity supply from renewable energy sources to the settlement and financial center for projects based on the results of tenders from January 1, 2022;

-           possibility to choose the indexation mechanism once during the life cycle of the RES project either for the consumer price index or for the change in the exchange rate of the national currency to the US dollar;

-           taking into account changes in the exchange rate and CPI by 100% as of October 1 compared to October 1 of the previous year.

Qazaq Green expresses confidence that all these measures will contribute to the creation of a more favorable investment climate in the renewable energy sector.

Amendments were also initiated to the LSI “On Amendments to the Rules for Organizing and Conducting Auctions, including qualification requirements for auction participants, content and procedure for submitting an application, types of financial security for an application for participation in the auction and conditions for their introduction and return, procedure for summing up the results and definitions of winners approved by the Order of the Minister of Energy of the Republic of Kazakhstan No. 466 dated December 21, 2017”.

The proposed changes relate to the time of the trading session, as well as the price change step. Thus, according to amendments, paragraph 32 of the LSI draft is planned to be worded as follows: “During the main time - 30 (thirty) minutes of the trading session - the price change step is at least 5 (five) tiyn per 1 (one) kilowatt-hour, from the period time of prolongation of the trading session by 5 (five) minutes, the price change step will be at least 50 (fifty) tiyn per 1 (one) kilowatt-hour.”

Qazaq Green encourages interested organizations and companies to follow the changes in LSI on RES on official sources (“Open LSIs”) and invites them to discuss the issues at the association site.