Uzbekistan wants to diversify its electricity market

At the expense of private players

Uzbekistan is going to upgrade its power supply system. This will require curbing the powers of the National Electric Grid of Uzbekistan, the state-owned company that is responsible for the entire system. Now, the country is planning to decrease the role of this company and let new suppliers improve the industry.

It is expected that JSC “National Electric Grid of Uzbekistan” will lose some of its responsibilities in purchasing electricity and managing the power grid. As a result, better conditions for private energy-producing companies would emerge, the government said. Once the new rules enter into force, big companies and regional power grid entities will purchase electricity from a single operator. In turn, this company is meant to be the only purchaser of energy from power-producing companies all over the country. It would also take up the responsibilities for the transportation of electricity and technical control and maintenance of the system of grids.

Moreover, Uzbek authorities are going to establish a network of regional energy suppliers as an alternative to another state-owned company JSC “Regional Power Grid.”

According to Uzbek officials, the modernization of the national power grid in order to provide the economy and population with the electricity they need would require about $20 billion of investments over the next few years.

In May, Uzbekistan’s Ministry of Economic Development and Poverty Reduction, the Ministry of Finance and the Ministry of Energy announced their common plan aimed at reforming the energy sector in the country. It is expected that private investors will take an active part in this endeavor while people get used to so-called “social standards” for the consumption of electricity and natural gas.

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