POWER SECTOR OF THE REPUBLIC OF KAZAKHSTAN

Production and consumption of electric energy in the Republic of Kazakhstan

Northern Zone Installed capacity 22 936.6 MW. Consumption 69,1 bln. kWh. Available capacity 19 329 MW. Production 81,7 bln. kWh.

Production in 2019 – 106 029 bln. kWh. ‒ TES — 85 955 bln. kWh. (81%) Western Zone Consumption 13,5 bln. kWh. ‒ GTPP — 8 976 bln. kWh. (9%) Production 13,4 bln. kWh. ‒ HPP — 9 985 bln. kWh. (9%) ‒ RES—1 114 bln. kWh. (1%)

Consumption in 2019 -105 193 bln. kWh. Southern Zone Consumption 22,7 bln. kWh. Production 11,0 bln. kWh.

www.invest.gov.kz +7 7172 620 620 POWER SECTOR OF THE REPUBLIC OF KAZAKHSTAN

Recent changes in power sector Investment opportunities

 Capacity market starting from January 1, 2019.  Modernization of generating equipment of Auction held in November 2019 had the trading volume: existing power plant Average age of power plant equipment in ‒ Western zone – 703.52 MW Kazakhstan is roughly 33 years. ‒ Northern zone – 4 181. 63 MW,  Maneuverable capacities in the Republic of Kazakhstan to cover peak loads and balance ‒ Southern zone – 1 330.94 MW. electricity supplies (SGPP, HPP with dumbs to Feed-in tariff is 590 thousand KZT ($1 415 USD) per 1 cover peak load) MWt per month (without VAT)  Energy efficiency and energy saving program

 Energy surplus according to Forecast balance of electric energy and capacity for the period 2020-2026

www.invest.gov.kz +7 7172 620 620 RENEWABLE ENERGY SOURCES

Key indicators for RES development: 12%

‒ 2020 – 3% 10% ‒ 2025 – 6% 8% ‒ 2030 – 10%

6%

Potential of RES in Kazakhstan: 4% ‒ wind energy is 920 billion kWh/year 2% ‒ solar energy – 2,5 bln. kWh /year ‒ hydro potential-62 billion kWh/year 0% ‒ thermal potential of geothermal waters is 4.3 GW 2020 2025 2030 RES development: Total installed capacity 1 507 MW (105 RES stations): ‒ Wind - 390,9 MW ‒ Solar – 883,6 MW ‒ Hydro – 224,6 MW ‒ Bio fuel – 7,82 MW

Project auction (with documentation) as a new type of auction introduced in November, 2019

www.invest.gov.kz +7 7172 620 620 RENEWABLE ENERGY SOURCES

The winner of the auction gets the right to: STATE INVESTMENT SUPPORT FOR RES Investment Investment ‒ Guaranteed purchase of electricity for a period of priority 15 years Exemption from customs duties on + + Annual tariff indexation after a year of operation of imports the plant: 70% - exchange rate of the national State in-kind grant currency to convertible currencies, 30%-CPI + + ‒ Priority dispatching VAT free import + ‒ Exemption from payment for services of electric Tax benefits (corporate income tax + grid companies for 10 years) Exemption from land tax for 10 years + Feed-in tariffs for RES: Exemption from property tax for 8 + years ‒ Wind PP - 21.69 KZT/kWh ($5,1 USD cents) Stability of legislation in the field of ‒ Solar PP – 16,97 KZT/kWh ($4,0 USD cents) taxation and employment of the ‒ HPP – 15.48 KZT/kWh ($3,6 USD cents) population in terms of attracting + ‒ Biogas PP - 32.15 KZT/kWh ($7,5 USD cents) foreign labor

www.invest.gov.kz +7 7172 620 620 Waste to energy projects in Kazakhstan

Project Description Nur-Sultan (~350 Kt/y)

Construction of up to 6 plants in Nur-Sultan, Almaty, Aktobe (~140 Kt/y) Shymkent, Taraz, Atyrau and Aktobe for MSW incineration with electricity generation

Atyrau (~140 Kt/y) Total annual capacity of 6 plants – up to 1,3 million Taraz (~100 Kt/y) tonnes of waste (indicative volumes) Almaty (~480 Kt/y)

Shymkent (~200 Kt/y)

The Government is developing a framework to support waste-to-energy projects at the legislative level: ‒ WtE projects to be granted a competitive “green tariff” with 15-year PPAs to be officially revealed in an auction process ‒ Each city’s administration to be obliged to support continuous supply of MSW to the plants There is also an opportunity to sign an investment contract with the Government to secure tax and custom incentives

www.invest.gov.kz +7 7172 620 620 Waste to energy projects in Kazakhstan

Construction of waste-to-energy Construction of waste-to-energy Construction of waste-to-energy plant in Nur-Sultan plant in Almaty plant in Shymkent

Description: Description: Description: Project implementation will result in an Project implementation will result in an Project implementation will result in an increase the level of processing of solid increase the level of processing of solid increase the level of processing of solid domestic waste as well as the creation of domestic waste as well as the creation of domestic waste as well as the creation of about 160-180 job places. about 200-220 job places. about 160-180 job places. Nur-Sultan is fast—rowing city whose Almaty is fast—rowing city whose As of 2019, Shymkent population is population in the last decade grew annually population in the last decade grew annually 1,009,085 people. It has increased by 9.0% by 5.8%. By 2050 the population is going to by 3.3% for last decade to 1.9 mln. over past 2 years. reach 3.1 mln. CAPEX (approximate) $ 234,264 mln. CAPEX (approximate) $ 113,333 mln. CAPEX (approximate) $ 117,030 mln. Project sale volumes: Project sale volumes: Project sale volumes: Processing 329 thousand tonnes of waste Processing 164 thousand tonnes of waste Processing 164 thousand tonnes of waste annually or 900 tonnes per day and annually or 450 tonnes per day and annually or 450 tonnes per day and electricity output – 240 mln kW/h (from electricity output – 119.8 mln kW/h (from electricity output – 119.8 mln kW/h (from 2025) 2024) 2024)

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