Cite report
IEA (2022), Solar Energy Policy in Uzbekistan: A Roadmap, IEA, Paris https://www.iea.org/reports/solar-energy-policy-in-uzbekistan-a-roadmap, Licence: CC BY 4.0
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Context of renewable energy in Uzbekistan
Key institutions and stakeholders in the energy sector in Uzbekistan
Uzbekistan’s energy sector is currently undergoing a large-scale transition. The key institutions and stakeholders for energy policy making and its implementation are summarised below.
The Ministry of Energy, established in February 2019, has overall responsibility for the development and implementation of energy policies, plans and programmes, and is authorised to play a central role in implementing renewable energy policy in Uzbekistan. It is also responsible for the regulation and supervision of the production, transmission, distribution and consumption of energy resources including electricity and the functioning of energy sectors, as well as the implementation of production-sharing agreements. Moreover, the ministry takes part in developing energy-related public-private partnerships (PPPs) and plays a role in improving the tariff policy in co‑operation with the inter-ministerial tariff council to facilitate the development of a competitive business environment.
The Ministry of Finance exercises price regulation, including tariff-setting for electricity, and general control over the financial stability of the state sector, among other functions. Moreover, the PPP Development Agency under the Ministry of Finance plays a key role in developing PPPs in co-operation with Ministry of Investment and Foreign Trade and the Ministry of Energy.
The Ministry of Investment and Foreign Trade is responsible for implementing the state investment policy, including foreign direct investments in the energy sector, and co-operating with international financial institutions and foreign governmental financial organisations. It is also responsible for devising and co-ordinating state policies on foreign trade and international economic co-operation.
The Ministry of Economic Development and Poverty Reduction is in charge of analysing and forecasting macroeconomic indicators and development based on proposed economic management market mechanisms and strategies to develop the main industries, including energy. The ministry also formulates strategies for industrial development in Uzbekistan based on the effective deployment of production forces, rations and food production.
The Cabinet of Ministers approves the rules for electricity and gas use and monitors investment programmes in the energy industry.
The State Committee of the Republic of Uzbekistan on Statistics is the official authority collecting energy statistics. It will play an important role in the future in collecting data on off‑grid solar photovoltaics and solar heat use in households.
The Thermal Power Plants joint-stock company (JSC), a thermal power generation company, operates the majority of thermal power facilities in Uzbekistan, consisting of ten thermal power companies. As of 2021, Thermal Power Plants operates 11 thermal power plants, including co-generation1 plants, with an installed capacity of 11 669 MW. Formerly, the power sector in Uzbekistan was vertically integrated and Uzbekenergo, a state‑owned monopoly, was in charge of power generation, transmission, distribution and retail service, while serving the function of planning, investment, daily operation and regulation of the sector. With a view to strengthening competition in the sector, a decision was made in March 2019 to unbundle Uzbekenergo into three JSCs: Thermal Power Plants JSC, the National Electric Grid of Uzbekistan JSC and the Regional Electric Power Networks JSC.
Uzbekhydroenergo JSC is a state-owned company which operates hydropower plants, another important source of energy in Uzbekistan. The company was separated from Uzbekenergo JSC and established in May 2017. In total, it operates 37 hydropower plants with an installed capacity of 1 853 MW (EBRD, 2020).
The National Electric Grid of Uzbekistan JSC, the systems operator, is responsible for implementing centralised operational dispatch of all power plants and for operating transmission networks.
The Regional Electric Power Networks JSC is in charge of local electricity distribution. Its distribution and sales to consumers are handled by 14 territorial JSCs under its management.
Context of renewable energy in Uzbekistan
Energy supply
Uzbekistan is one of the world’s largest natural gas producers. Its energy production amounted to 54.5 million tonnes of oil equivalent (Mtoe) in 2019. Energy production reached a record high of 56.7 Mtoe in 2008. This amount had decreased by 20% by 2015, mainly due to the global economic crisis and a decline in natural gas reserves. It then recovered by 22% by 2019 from the 2015 level thanks to the development of gas projects in Uzbekistan. Natural gas is the dominant energy source in Uzbekistan, accounting for 90.5% of total energy production (49.3 Mtoe in 2019), while other energy sources include oil (5.8% in the same year), coal (2.6%), hydro (1.0%) and a negligible amount of biofuels.
Energy production by source in Uzbekistan, 2008-2019
OpenUzbekistan is a net exporting country. Looking at its energy supply, total energy supply was 47.1 Mtoe in 2019. Total energy supply decreased by 22% between 2011 and 2015 due to a slump during the global financial crisis, but has grown by 30% over the last 5 years mainly due to an increase in residential sector consumption. Natural gas accounted for 85.8% of total energy supply in 2019, while the remainder was mainly from oil (8.2% in the same year), coal (4.4%) and hydro (1.2%).
Total energy supply in Uzbekistan, 2008-2019
OpenElectricity generation
Uzbekistan’s electricity generation was 63.5 terawatt hours (TWh) in 2019 due to an increase in generation capacity. Overall generation has grown steadily, with an increase of 27% since 2008, most of which was supplied by natural gas. In 2019, natural gas accounted for 85% of overall generation, followed by hydro (10.2%) and coal (3.7%).
Total installed capacity was 12.9 GW in 2019, mainly consisting of 11 thermal power plants (TPPs), including co-generation plants (11.0 GW, or 84.7% of total capacity), and 42 hydropower plants (HPPs) (1.85 GW, or 14.3%).
Looking at renewables by technology, almost all renewable energy in Uzbekistan is generated by hydropower (6.5 TWh, or 10.2% of overall generation in 2019), while wind and solar power are negligible to date.
Uzbekistan’s power system is part of the Central Asia Power Grid with Kazakhstan, Kyrgyzstan, Tajikistan and Turkmenistan. Interconnections of 220 kilovolts (kV) and 500 kV transmission lines exist with the 4 countries respectively as do 220 kV transmission lines with Afghanistan. The net volume of electricity trade remained relatively constant between 2010 and 2017, while the total trade electricity was on a downward trend mainly due to the withdrawal of individual countries from the Central Asia Power Grid, having decreased to 5.4 TWh in both directions. In August 2020, the government of Uzbekistan signed an agreement with the government of Afghanistan on ten-year electricity export, including the construction of a 500 kV interconnection line, which could help increase Uzbekistan's net electricity export.
Electricity trade with neighbouring countries in Uzbekistan, 2008-2019
OpenHeat
Heat is the largest energy end-use in Uzbekistan, accounting for almost two-thirds of total final energy consumption. Thanks to energy efficiency improvements, Uzbekistan's total heat consumption has declined by more than one-third over the past decade. It represented close to 800 petajoules (PJ) in 2018. The buildings sector accounts for about two-thirds of total heat consumption and industry represents most of the remainder. Heat demand is almost exclusively met by fossil fuels, and in particular natural gas, which represents more than three‑quarters of total heat supply in the country.
District heating networks supplied 120 PJ of heat in 2019, representing about one-seventh of total heat consumption. Natural gas accounted for 95% of district heat supplied in 2019, the remainder being mostly from coal. The buildings sector is responsible for over 80% of total district heat consumption, half of which occurs in the commercial and public sector, where it represents about one-third of total heat supplies.
Although limited data are available regarding traditional uses of biomass for heating, several kinds of biomass are traditionally used in rural areas, including cotton stalks for cooking, and livestock and poultry waste for fuel (IEA, 2020a).
Solar energy potential
Uzbekistan has considerable renewable energy potential, a substantial amount of which lies in solar energy. The solar energy gross potential totals 2 134 x 103 PJ, while technical potential is estimated at 7 411 PJ, which is equivalent to almost four times the country’s current primary energy consumption.
Renewable energy source potential in Uzbekistan
Renewable energy source |
Gross potential |
Technical potential |
---|---|---|
Hydropower |
385 PJ |
84 PJ |
Wind power |
92 PJ |
17 PJ |
Solar power |
2 134 x 103 PJ |
7 411 PJ |
Geothermal energy |
2 805 x 103 PJ |
13 PJ |
Total |
4 940 x 103 PJ |
7 507 PJ |
Uzbekistan benefits from high solar irradiation. Global horizontal irradiance (GHI) measures the density of solar resources available per horizontal surface area, including both direct and diffuse radiations.2 The GHI serves as an indicator for assessing the potential of solar photovoltaics (PV), which converts both radiations into electricity. Uzbekistan’s GHI is estimated at 4.52 kWh per square metre (m2) per day in the median value (with a range of 4.0‑5.0 kWh/m2/day), which is higher than several European countries with good solar conditions, such as Spain (4.64 kWh/m2/day) or Italy (4.07 kWh/m2/day).
Global horizontal irradiance, world and in Uzbekistan
Direct normal irradiance (DNI) is the relevant metric to consider the possibility of using concentrating solar power (CSP) and solar thermal technologies, which require direct irradiation. The DNI in Uzbekistan is 4.44 kWh/m2/day in the median value (ranging from 3.03 kWh/m2/day to 5.27 kWh/m2/day). In comparison, Spain and the United States, the major markets for CSP globally, show a slightly higher median DNI (5.34 kWh/m2/day and 4.76 kWh/m2/day, respectively), but these are on par with values observed in the southern regions of Uzbekistan.
Direct normal irradiance, World and Uzbekistan
As shown in the figure below, solar thermal is used in a number of countries with levels of solar insolation similar to those in Uzbekistan. While the majority of applications globally correspond to domestic solar thermal water heaters, solar thermal heat can also be used for space heating in buildings and greenhouses, space cooling (when collectors are paired with an absorption or adsorption chiller), low- to medium-temperature industrial processes (e.g. drying, sterilisation), and wastewater treatment. There are significant opportunities for the integration of solar thermal heat use in district heating networks as well.
Share of solar thermal heat consumption in total final energy consumption, in selected countries and regions, 2019
OpenOther solar heating solutions are also emerging, such as solar PV-to-heat (PV2heat), which consists of PV modules directly (and solely) connected to an electric resistance water heater using DC power without inverters. The simplicity of installation, reliability and cost-competitiveness of PV2heat systems offer perspectives for deployment in various regions of the world, including, potentially, in Uzbekistan.
Electric heat pumps, while not necessarily related to solar energy, are becoming more popular in many markets thanks to lower installation costs relative to potential savings on energy spending and higher energy performance. In 2020, electric heat pumps only met up to 7% of heating needs in buildings globally, but they could easily supply more than 90% of global space and water heating at a lower level of CO2 emissions than condensing gas boiler technology (IEA, 2021b).
Operating temperature for various heat technologies
OpenLarge-scale solar PV projects in Uzbekistan
With the help of international financial institutions such as the World Bank Group, the Asian Development Bank, and the European Bank for Reconstruction and Development, since 2019, the government of Uzbekistan has implemented competitive bidding processes with a view to developing large-scale solar PV projects through increased foreign direct investment. Ten large-scale solar projects totalling 2 050 MW have been put out to tender mostly in the southern and south-western regions of the country where the GHI is higher than the national average. Of this, 1 300 MW had been awarded as of August 2021; the 100 MW project in the Navoi region began operation in August 2021.
Announced large-scale solar PV projects in Uzbekistan
Year awarded |
Project location |
Offered capacity |
Awarded tariff |
Supply period |
Awarded company |
---|---|---|---|---|---|
2020 |
Karmana district, Navoi region |
100 MW |
26.79 USD/MWh |
25 years |
Abu Dhabi Future Energy Company PJSC (Masdar) |
2021 |
Samarkand region |
100 MW |
n/a |
25 years |
Total Eren |
2021 |
Nurata district, Navoi region |
200 MW |
n/a |
25 years |
Phanes Group |
2021 |
Samarkand region |
220 MW |
17.91 USD/MWh |
25 years |
Masdar |
2021 |
Jizzakh region |
220 MW |
18.23 USD/MWh |
25 years |
Masdar |
2021 |
Sherabad district, Surkhandarya region (Phase I) |
457 MW |
18.045 USD/MWh* |
25 years |
Masdar |
|
Guzar district, Kashkadarya region (Phase II) |
300 MW |
(TBD) |
(TBD) |
(TBD) |
|
Xorazm region |
100 MW |
(TBD) |
(TBD) |
(TBD) |
|
Namangan region |
150 MW |
(TBD) |
(TBD) |
(TBD) |
|
Bukhara region |
200 MW |
(TBD) |
(TBD) |
(TBD) |
Policy landscape for renewables in Uzbekistan
To ensure energy security and promote renewable energy use, the government of Uzbekistan has adopted a wide range of strategies and laws related to energy.
The Strategy of Action for the Five Priority Development Areas of Uzbekistan in 2017‑2021, adopted in February 2017, provides key directions for economic development. In terms of energy, the strategy indicates the need for reducing the energy intensity and resource intensity of the economy, the widespread introduction of energy-saving technologies in production, and expanding the use of renewable energy sources.
The government expects the share of renewable generation in the power mix to increase to at least 20% by 2025 (compared to 9.4% in 2018), as indicated in the Strategy for Innovative Development of the Republic of Uzbekistan for 2019-2021, adopted in September 2018.
Building reliable electricity networks is essential for the deployment of more renewables in the power sector. In this regard, the Strategy for the Development of Electric Networks in the Republic of Uzbekistan until 2025 was formulated in July 2019. It provides an overall plan for the construction of new and the modernisation of existing transmission and distribution lines and substations up to 2025.
In order to implement comprehensive measures to deepen structural reforms, modernise and diversify key sectors such as agriculture and manufacturing, and balance the socio‑economic development of its territories, the government adopted the Strategy for the Transition of the Republic of Uzbekistan to the Green Economy for the Period 2019-2030 in October 2019. It encompasses a wide range of objectives within several priority areas, including the energy sector. As regards renewable energy technologies, it makes reference to:
- further developing renewables by raising their share in the power mix to more than 25% by 2030 (compared to 10.2% in 2019)
- modernising the infrastructure of industrial enterprises and applying clean and environmentally safe technologies and industrial processes more widely
- using solar collectors for water heating
- increasing the automation of technological processes while reducing electric energy consumption for transmission and distribution
- improving the main power network configurations and modernising them to increase power system stability
- equipping power consumption systems with smart meters.
In response to the Strategy for 2019-2030, the government developed the Concept Note for ensuring electricity supply in Uzbekistan in 2020-2030 in May 2020. This concept note defines medium- and long-term objectives and directions for the development of the power sector. It identifies six main objectives to improve electricity supply: 1) satisfying the country’s power demand; 2) improving the nation’s energy efficiency; 3) increasing the energy efficiency of power generation and transmission; 4) reducing the damage of power facilities; 5) developing and expanding the use of renewables and their system integration; and 6) developing an efficient electricity market. With a view to meeting the growing power demand while expanding renewable generation capacity, the following targets have been set:
- increase power capacity from the 12.9 GW in 2019 to 29.2 GW by 2030 and electricity generation from 63.6 TWh in 2019 to 120.8 TWh by 2030
- increase the capacity of renewable energy generation to 5 GW for solar power and 3 GW for wind by 2030 (compared with no large-scale solar PV plants operational in 2019).
The Uzbek government is currently planning to set a renewable capacity target of 4 GW for solar power and 4 GW for wind by 2026 (MoE, 2022). The country is also considering increasing the 2030 renewable capacity targets from 5 GW to 7 GW for solar PV and from 3 GW to 5 GW for wind (MoE, 2021a).
The Law on the Use of Renewable Energy Sources, adopted in May 2019, defines opportunities and incentives for individuals and manufacturers of renewable energy installations, including exemption of property and land tax. At the same time, the Law on Public‑Private Partnership (PPP) was enacted to allow/encourage private sector participation in public sector infrastructure projects, including those in the power sector. Multiple PPP projects are currently underway.
The Decree on Accelerated Measures to Improve Energy Efficiency of Economic and Social Sectors, the Introduction of Energy-Saving Technologies and the Development of Renewable Energy Sources was approved in August 2019. This decree defines the share of renewable electricity in the power mix to reach at least 25% by 2030. It also specifies subsidies to individuals and companies that install energy equipment, including solar PV facilities.
The Law on the Rational Use of Energy, amended in April 2020, stipulates the role of the Ministry of Energy in implementing a unified state policy on rational energy use applicable to all economic sectors and social facilities. In other words, it positions the ministry as a pillar for implementing the country’s energy policy, including renewables.
The Programme of Measures for Further Development of the Hydropower Sector for 2017‑2021, adopted in May 2017, addresses projects for the construction of new and the modernisation of existing HPPs and the provision of tax incentives for imported equipment required for these projects.
In its Nationally Determined Contributions, ratified in November 2018, Uzbekistan committed to decreasing specific GHG emissions per unit of GDP by 10% by 2030 from 2010 levels. As regards renewable energy, to improve energy efficiency in various sectors, the Nationally Determined Contribution proposes the development and broader use of renewable energy sources, such as constructing large solar PV power and biogas plants and scaling up wind power generation. Moreover, during the recent United Nations’ Climate Change Conference COP26 in Glasgow in 2021, the government announced its intention to reduce GHG emissions per unit of GDP by 35% by 2030. To achieve this ambitious target, the government needs to find a way to increase the total generation capacity of solar and wind to 8 GW by 2026, which means the current target needs to be achieved four years ahead of the schedule.
In close co-operation with international financial institutions, the government of Uzbekistan has been also developing several master plans to secure energy supply while achieving a carbon‑neutral power sector in the long term. The Power Sector Masterplan to 2030, developed with the technical support of the Asian Development Bank (September 2019), identifies ways to diversify the power mix and provides plans for achieving lower cost generation and reliable transmission development.
The Roadmap to Carbon-Neutral Electricity Sector in Uzbekistan 2050 was developed with the support of the European Bank for Reconstruction and Development and the government of Japan in January 2021. It provides insights on the policies, technologies and investments necessary to achieve a carbon-neutral power sector by 2050, and leverages advanced energy system modelling and scenario analysis tools. It also explores possible future development pathways for its power sector. The roadmap is not (yet) reflected in the government’s official targets.
With a view to ensuring sufficient power supply in the medium term, the Transmission Network Development Plan to 2030, developed with the assistance of the World Bank, was being finalised at the time of writing. The Distribution Network Development Masterplan is also under development, with the support from the Asian Development Bank.
In terms of heat, for the purpose of consistent heat supply to consumers and efficient use of energy resources, the Decree on the Program for the Development of the Heat Supply System for the period 2018-2022 was adopted in April 2017. It identifies the following as priorities for further development of the heat system in Uzbekistan: 1) introducing new energy sources, including renewables; 2) developing a decentralised heat supply system for apartments and other social facilities; 3) modernising and reconstructing outdated inefficient heating boilers; and 4) introducing an automated accounting system for the consumption and production of energy sources.
The table below summarises renewable generation and solar capacity targets.
Current and targeted renewable generation ratio and solar capacity in Uzbekistan
|
2019 |
2025 |
2030 |
---|---|---|---|
Renewable generation ratio |
10.2% |
20% |
25% |
Solar power capacity |
– |
(no target) |
5 GW* |