ERG will annually pay $350 million if carbon border tax is introduced

Eurasian Resources Group (ERG) would pay up to $350 million annually in a carbon border tax if one is introduced, said Talgat Temirkhanov, chair of the Kazakhstan Electric Power Association Chairman. 

«If a carbon border tax is introduced in the near future, ERG will annually lose from $330 million to $350 million at the border. To give you an idea of what’s exactly worth $350 million, it estimates approximately the wage bill of a large mining and metallurgical company. We realize that if we don’t make the first steps towards the carbon footprint reduction of our export items now, the economic advance and stability in general… To put it mildly, we’ll have to work on that matter,» he explained during the KazAtomExpo exhibition panel session. 

According to him, the launch of a nuclear power plant as a base load generation source will enable future economic growth.

«A nuclear power plant is exactly this initial step, as we export a lot of oil and metals, which, one way or another, depend on a generation structure. That’s why this matter is not only of energetics specialists’ interest but also of users’,» Temirkhanov emphasized.

On February 20, 2024, the Minister of Energy issued an order adopting a development plan for the electric power industry through 2035. The plan includes adding approximately 26.5 GW of new capacity. It implies updating and reconstructing existing plants and commissioning new facilities, including combined cycle power plants, a nuclear power plant and renewable energy plants. The new facilities are to be established through auctions, bidding, and intergovernmental agreements. The Ministry of Energy expects that by 2026, this plan will address the country’s electricity shortage.

Currently, the electricity is most keenly felt during peak consumption hours, in particular in the evenings, when Kazakhstanis return home from work and turn on various appliances. The shortage is made up by acquiring expensive Russian electricity.

Among the shareholders of Eurasian Resources Group are the Ministry of Finance of Kazakhstan (40%), Alexander Mashkevich and the Ibragimov family (20.7% each) and Patokh Сhodiev (18.6%). Alexander Mashkevich, Patokh Chodiev and the family of the late Alijan Ibragimov, which members are wife Mukadaskhan Ibragimova and four sons: Dostan, Davron, Shukhrat and Furkhat (a 37-year-old Shukhrat Ibragimov was appointed earlier this year as Chairman of the Board of Directors of ERG) became the first dollar billionaires in Kazakhstanin 2005, with equity worth $1 billion each, according to Forbes.

Later, Alexander Mashkevich and Patokh Chodiev renounced their Kazakhstani citizenship in favor of Israeli and Belgian, respectively. Chair and major shareholder of Eurasian Resources Group Alexander Mashkevich was ranked sixth among the richest Israelis in the Forbes ranking in 2022 with $3.7 billion in equity. Mashkevich and Chodiev did not appear on the list in 2023 and 2024, but the Ibragimov family increased their wealth to $1.5 billion in 2024 compared to $1.32 billion in 2023.