Tashkent, Uzbekistan, March 25, 2022—The government of Uzbekistan finalized a public-private partnership agreement today, with IFC support, for a new thermal power plant in the Syrdarya region, which will help modernize the country's power sector, reduce costs, and cut carbon emissions.
Uzbekistan's JSC National Electric Grid and Ministry of Investments and Foreign Trade signed the 25-year project agreement with a consortium comprising Electricite De France (EDF), Nebras Power Sojitz Corporation and Kyuden International. The consortium will be responsible for building and operating the 1,600-megawatt combined cycle gas turbine power plant, which is expected to be one of the most efficient thermal power plants in the country.
IFC partnered with the Global Infrastructure Facility (GIF) to assist the Uzbek government in structuring and implementing the PPP and assisted in the competitive international tender for the project. GIF is a G20 initiative, housed in the World Bank, supporting quality sustainable infrastructure solutions in emerging markets and developing economies.
Uzbekistan's electricity generation is currently dominated by gas, with an inefficient aging fleet of thermal plants near the end of their operating life. The new plant is expected to be almost twice as efficient as older models, helping to decrease gas consumption, reduce the country's carbon footprint, and support the integration of renewable energy.
"The project will help resolve key issues in Uzbekistan's energy generation sector," said Sardor Umurzakov, Deputy Prime-Minister, Minister of Investment and Foreign Trade of Uzbekistan. "Firstly, the project will increase the stability of energy generation and supply. Secondly, modern technology will ensure the efficient use of natural gas and water. Finally, the successful implementation of the project will provide additional confidence for potential investors to invest in Uzbekistan's energy sector."
Stephanie von Friedeburg, IFC Senior Vice President for Operations, said: "Electricity demand is rising in Uzbekistan, and a stable power supply is essential for sustainable, inclusive growth. This project is part of IFC's efforts to support the Government's groundbreaking reforms to modernize the energy sector, including replacing old and inefficient power plants. By encouraging private sector investment in new, more efficient power generation, Uzbekistan is helping to both reduce greenhouse gas emissions and meet growing energy demands."
GIF support included an investment feasibility study and bolstering the transaction implementation up to the project's commercial close. GIF also leveraged its advisory partner network to promote investment opportunities and raise awareness among developers and financiers.
"Uzbekistan is a strategically important country for GIF. We have long-standing engagements in multiple sectors, from energy and airports to roads and solid waste, and we are delighted to partner in this project to support the country's energy transition. This project's successful implementation reinforces our commitment to promoting sustainable infrastructure investments and mobilizing private capital in the country," said Jason Zhengrong Lu, Head, Global Infrastructure Facility.
IFC has been advising the government of Uzbekistan on attracting private investments in the energy sector since 2018. This project is the third competitive tender in the energy sector completed by the government of Uzbekistan in partnership with IFC.
IFC—a member of the World Bank Group—is the largest global development institution focused on the private sector in emerging markets. We work in more than 100 countries, using our capital, expertise, and influence to create markets and opportunities in developing countries. In fiscal year 2021, IFC committed a record $31.5 billion to private companies and financial institutions in developing countries, leveraging the power of the private sector to end extreme poverty and boost shared prosperity as economies grapple with the impacts of the COVID-19 pandemic. For more information, visit www.ifc.org.
The Global Infrastructure Facility (GIF), a G20 initiative, has the overarching goals of increasing private investment in sustainable infrastructure across emerging markets and developing economies and improving services that contribute to poverty reduction and equitable growth aligned with the SDGs. The GIF provides funding and hands-on technical support to client governments and multilateral development bank partners to build pipelines of bankable sustainable infrastructure. The GIF enables collective action among a wide range of partners – including donors, development finance institutions, country governments, together with inputs of private sector investors and financiers – to leverage both resources and knowledge to find solutions to sustainable infrastructure financing challenges. For more information, visit www.globalinfrafacility.org/