EBRD acquires stake in Kazakh power company

By EBRD  Press Office
@ebrd

In its first equity investment in the power sector of Kazakhstan, the EBRD is investing up to KZT 9.2 billion (€46 million equivalent) to acquire a stake in the private power company Central-Asian Electric Power Corporation (CAEPCO).

The capital injection will be used for the company’s investment programme up to 2013, including the upgrade and rehabilitation of CAEPCO’s generation and distribution assets to improve efficiency, reliability and performance. CAEPCO is the largest private vertically-integrated power company in Kazakhstan and produces above six percent of the country’s total electricity.

The company operates in northern and central Kazakhstan and its main region of business is Pavlodar and the oblasts of north Kazakhstan, where it operates four combined heat and power plants. In 2007 the EBRD provided a $30 million loan for efficiency improvements and the upgrading of Pavlodar CHP-3.

The Government of Kazakhstan and the EBRD launched a Sustainable Energy Action Plan in June 2008 to promote the conservation and rational use of energy resources as well as the efficient and sustainable supply of power and energy in the country. Kazakhstan’s available power capacity is largely located in the north, while in the south energy has to be imported. In addition to investments in a new transmission network, the country is also trying to alleviate the situation by supporting the more efficient use of energy.

Nandita Parshad, EBRD Director Power and Energy Utilities, said “we are delighted to support CAEPCO by becoming a shareholder in the company. This demonstrates our confidence in the company as well as our commitment to the development of the energy sector in Kazakhstan. Our planned investments will be a major contribution to the more efficient and environmentally-friendly generation and use of energy.”

Erkyn Amirkhanov, Member of the Board of Directors of Central-Asian Electric Power Corporation, said that “the equity investment we are receiving from the EBRD constitutes an important milestone in development of our company and is important for the whole power sector of the Republic of Kazakhstan. The EBRD’s participation in the capital of a private energy company will support the sustainability and reliability of the company, expand our business opportunities, improve corporate governance and will raise the attractiveness of the power industry for both foreign and local investors.”

Since the beginning of its operations in Kazakhstan in 1993, the EBRD and its partners have invested almost $6 billion in more than 100 projects in the country. The Bank has become the single largest investor outside the oil and gas sector in Kazakhstan. Energy and energy efficiency investments are among the EBRD’s priorities for the country.