ASTANA, KAZAKHSTAN (24 April 2023) — The Asian Development Bank (ADB) has begun exploring opportunities to accelerate the retirement of coal and other fossil fuel plants in Kazakhstan and replace or repurpose them with clean energy under the bank’s Energy Transition Mechanism (ETM) program.
Following a request from the Ministry of Energy of Kazakhstan, ADB has initiated a pre-feasibility study to help the government identify coal-fired and combined heat-power plants that could be potential candidates for accelerated retirement. ADB has provided a $225,000 grant for the study, which will analyze the current policy and regulatory environment in the Central Asian nation.
Kazakhstan is a major consumer of coal with some 25 billion tons of reserves estimated to be the eighth largest worldwide. About 70% of the nation’s electricity is produced from coal while energy-related activity, including heat and electricity production, accounted for more than 80% of the country’s total greenhouse gas (GHG) emissions.
In February, President Kassym-Jomart Tokayev approved Kazakhstan’s long-term decarbonization strategy wherein the government aims to reduce GHG emissions by 15% by 2030 and achieve carbon neutrality by 2060.
“As Asia and the Pacific’s climate bank, we are pleased to support the government’s commitment to fulfilling its nationally determined contributions under the Paris Agreement and achieving carbon neutrality by 2060,” said ADB Director General for Central and West Asia Yevgeniy Zhukov. “ETM could help to significantly reduce the country’s GHG emissions, ramp up much-needed clean energy investments, and expand access to reliable, sustainable energy.”
ADB’s ETM is a scalable, replicable program that uses concessional and commercial capital to retire or repurpose existing coal and other fossil fuel plants on an accelerated schedule, replacing them with clean power capacity. ETM is one of many ADB initiatives that can help Asia and the Pacific mitigate the worst impacts of climate change such as extreme sea level rises and destructive weather events.
Kazakhstan becomes the fifth country to begin working with ADB on ETM, following Indonesia, Pakistan, the Philippines, and Viet Nam.
To minimize potential negative socioeconomic impacts such as job losses when plants are closed early or when there is a slowdown of economic activity in the coal-value chain, ADB is working with partners to integrate just transition policies and programs as a core element of ETM. These include retraining and reskilling programs for vulnerable workers for example, in many cases women, to find new opportunities in emerging industries.
ADB is committed to achieving a prosperous, inclusive, resilient, and sustainable Asia and the Pacific, while sustaining its efforts to eradicate extreme poverty. Established in 1966, it is owned by 68 members—49 from the region.