Kazakhstan has no alternative to nuclear power, says energy minister

Kazakhstan has no other option but to build a nuclear power plant, according to Minister of Energy Almassadam Satkaliyev.

«Global trends indicate that constructing a nuclear power plant is the only viable solution for replacing decommissioned capacities and ensuring Kazakhstan’s energy self-sufficiency. Currently, there is no alternative to nuclear power plants,» Satkaliyev stated at a government meeting.

The minister highlighted that the global trend is shifting towards carbon neutrality, with international financial institutions increasingly unwilling to invest in coal-fired power plants. Additionally, Kazakhstan cannot pursue large-scale gas-fired generation due to its limited gas resources.

Satkaliyev noted that, due to its intermittency, renewable energy cannot reliably serve as a base power generation source.

Currently, there are 415 nuclear reactors worldwide with an installed capacity of 374 gigawatts (GW), providing about 10% of global electricity. Additionally, 61 reactors are under construction, including 27 in China alone.

Satkaliyev also mentioned that by 2035, electricity consumption in Kazakhstan is projected to reach 152.4 billion kilowatt-hours (kWh). However, due to decommissioning, increased wear and tear and stricter environmental regulations, the output from currently operating energy sources is expected to decline to less than 135 billion kWh.

Today, the majority of electricity in Kazakhstan is generated by coal-fired plants, which account for 66% of the total generation. At the same time, renewable energy is proliferating; by the end of 2023, there were 148 renewable power facilities and renewable energy generation reached approximately 6%.

By 2035, new generating capacities are projected to total 26.5 GW. The projected new energy mix is as follows: 27% gas generation, 12% hydropower, 17% coal-fired generation, 9% nuclear power plants and 36% renewables.

«Building a nuclear plant will address energy and environmental challenges while opening up new opportunities for research and education. Collaborating with international partners on joint projects will enhance Kazakhstan’s status not only as a global leader in uranium mining but also in advanced nuclear technologies, such as the production of radioisotopes for the medical and oil and gas industries, as well as semiconductors and printed circuit boards,» the minister said.

He also noted that constructing the nuclear plant will enhance expertise in material and equipment production, significantly advance technological development and attract investment and tax revenues. The construction phase is expected to create approximately 8,000 jobs, with 2,000 permanent positions once the plant is operational. Each job at the nuclear power plant is anticipated to create up to 10 additional jobs in related industries, benefiting the labor market and regional development.

«In light of this, I propose submitting a draft government resolution to initiate a national referendum on the construction of a nuclear power plant in Kazakhstan, and to introduce a draft presidential decree on holding the referendum,» said Satkaliyev.

The proposal has been endorsed by government members.

During his annual address to the people of Kazakhstan on Sept. 1, 2023, President Kassym-Jomart Tokayev stated that the decision on constructing the nuclear power plant should be made through a national referendum. Nearly a year has passed since then, but the date for the referendum has not yet been set. It is expected to take place this fall.

The first nuclear power plant in Kazakhstan is set to be constructed in the village of Ulken, Zhambyl district, Almaty region, on the shore of Balkhash Lake. The local community has supported the project. The plant will use III+ technology, designed to ensure reactor reliability in both standard and extraordinary accident scenarios.

Samruk-Kazyna is considering two financing options for the construction: utilizing its own funds and the National Fund, according to Yernat Berdigulov, managing director for strategy and asset management at the state holding, who discussed the matter with Kursiv in December 2023.

Samruk-Kazyna officials have frequently underscored Rosatom’s strengths as a potential partner, citing its extensive experience with reactor construction worldwide. During his first press conference as head of the holding in July 2023, Samruk-Kazyna’s Chairman Nurlan Zhakupov identified Rosatom as a contender for the nuclear power plant project. He also acknowledged several challenges associated with the initiative.

Several international companies have submitted proposals for constructing the nuclear power plant in Kazakhstan, including EDF (France), CNNC (China), Rosatom (Russia) and KHNP (South Korea).

In early March 2023, Samruk-Kazyna’s Managing Director Yernat Berdigulov held discussions with foreign partners about the development of Kazakhstan’s energy sector, including its nuclear industry. According to Timur Zhantikin, general director of Kazakhstan Nuclear Power Plants, a subsidiary of Samruk-Kazyna, proposals from four contenders indicated that the cost of generating 1 kWh at the nuclear power plant in Kazakhstan would be 8 cents or approximately KZT34.86, based on the National Bank’s exchange rate at that time.

The decision to select a foreign partner for the nuclear power plant was initially anticipated by the end of 2022 but was postponed to early 2023, according to Asset Makhambetov, chief project officer at Kazakhstan Nuclear Power Plants, in December 2022. The partner has not yet been chosen, possibly due to Rosatom’s strong position in the bidding process. Additionally, there were discussions about including Russian nuclear entities in the European Union’s 11th package of sanctions, though this was ultimately excluded from the final document. Had it been included, it could have significantly impacted the plant construction in collaboration with Rosatom.

Kazakhstan has increased its electricity imports from Russia by 29% this year, reaching 1 billion kWh and accounting for nearly 50% of all electricity exports from its northern neighbor. Nabi Aitzhanov, сhairman of the board of Kazakhstan Electricity Grid Operating Company (KEGOC), noted in early March that the electricity shortage for the 2024-2025 heating season (October 2024 to March 2025) is expected to be about 1,025 megawatts (MW). Kazakhstan will typically address this shortage with supplies from Russia.

At a briefing on Aug. 3, 2022, Vice Minister of Energy Zhandos Nurmaganbetov stated that after construction of the first nuclear power plant in Ulken begins, Kazakhstan may start planning a second facility in Kurchatov, in the east of the country. He also noted that discussions are ongoing about the total number of nuclear power plants Kazakhstan will ultimately develop.

The Ministry of Energy aims to reach 2.4 GW nuclear capacity in Kazakhstan by 2035. Initially, the cost for each 1.2 GW plant was estimated at $5 billion in 2022, totaling $10 billion per plant. However, this estimate has since increased to $15 billion. Construction is expected to take 10 years, so work would need to begin before 2025-2026 to meet the deadline.