The European Bank for Reconstruction and Development is helping to modernise Kazakhstan’s energy generation network with a senior secured loan of 3.1 billion Kazakh tenge (equivalent to €15 million) to AES Sogrinsk CHP power plant.
The 10-year loan with a two-year grace period will be used to co-fund the plant’s 5.5 billion Kazakh tenge-worth rehabilitation programme, including the purchase and installation of modern energy efficient equipment. The loan will be extended in Kazakh tenge, in line with the EBRD’s focus on increasing local currency lending in its countries of operations.
AES Sogrinsk CHP is a private power generation company with a majority ownership by AES Corporation (USA), serving residential and industrial customers in eastern Kazakhstan. It owns and operates a 60MW coal-fired co-generation power plant and adjacent heating network, playing a vital role in the country’s thermal power generation and in security of supply in one of Kazakhstan’s most heavily industrialised and electricity-deficient regions.
The EBRD’s loan will be used to co-finance AES Sogrinsk’s investment programme that will enable the plant to replace some of its low efficiency and high carbon intensity units like turbine-generator, boilers and back-up systems. In addition, the plant will be able to carry out environmental and energy efficiency measures.
As part of the programme, the new energy efficiency investments will lead to a two-fold increase in electricity production from 250 GWh to nearly 590 GWh a year with net electricity efficiency improvement from 18 per cent to 25 per cent. Moreover, the plant expects to significantly reduce its green-house gas emissions by around 100,000 tonnes annually in the long run.
“The EBRD is pleased to offer its first local currency loan in the Kazakh power sector. With this important project we will help AES Sogrinsk power plant achieve higher efficiency and increase its production with advanced technology and equipment, meeting growing electricity demand in eastern Kazakhstan and improving environmental standards,” said Nandita Parshad, EBRD Director for Power and Energy.
“AES is keen on increasing its investments in Kazakhstan to meet the growing power demands of Kazakhstan’s economy. We are very glad that the EBRD agreed to be our partner in AES Sogrinsk’s modernisation project,” said Julian Nebreda, Regional President for Europe and Senior Vice President of AES.
Since the beginning of its operations in Kazakhstan, the EBRD has invested over €2.8 billion in over 130 projects in various sectors of the Kazakh economy, mobilising additional investments in excess of about €7 billion, with 65 per cent of the projects’ being investments into the development of the country’s private sector.