Updated on July 15, 2024, 01:12PM (AST)

Deputy Chairman of the Management Board of EDB Amangeldy ISENOV:

Eurasian Development Bank (EDB) worked out a program on financing renewable energy projects, which it intends to direct nearly $ 600 million to. Deputy Chairman of the EDB Management Board Amangeldy ISENOV talked through the planned and ongoing renewable energy projects and green energy financing specifics in an interview with Interfax-Kazakhstan.


- Market participants believe that the inaccessibility of long-term financing in the national currency stems the development of renewable energy sources in Kazakhstan. I would like to hear your opinion on this issue.

- I wouldn't put the question like that. The inaccessibility of funding constrains the growth of any sector of the economy. So, of course, [this] will slow down. However, it is not allowed to thoughtlessly pump in large amounts. I believe that currently everything is being done correctly. The market is dynamic, the situation and approaches will change, and accordingly, some types of state support will change.

In general, to date the development institutions provide long-term financing for projects with a good degree of scrutiny and readiness for the implementation by the initiators, as well as provided that guaranteed sales are available.


- In your opinion, is it realistic to bring the share of renewable energy sources in the total energy volume up to 50% in Kazakhstan by 2050?

- There are certain types of forecasts and approaches to their formation. Will the share reach 50%? You know, it depends on how you count. But on the other hand, is it worth setting such tasks? This is a goal-setting problem; goals should be ambitious but realistic. One needs to understand whether [this] could be implemented or not. We are not talking about dreams but about goals. From the bank’s perspective, of course, I can say Eurasian Development Bank will do everything that, in fact, it can do. For example, we approved a renewable energy sources support financing program. Now this program is being agreed by our shareholders, it envisages funding about $ 600 million in total. Plus, the other development institutions and commercial banks will participate in financing projects of this kind.

It should also be reckoned that the state has launched the capacity market, therefore, I think that some percentage of the 50% set task will most likely be achieved.


- What is the share of renewable energy projects in the EDB total portfolio? Are there any plans to increase the number of such projects?

- Energy is one of the bank's priority sectors and the bank is actively participating in the implementation of renewable energy projects. At the moment we have 9 ongoing projects with a total volume exceeding $ 500 million, including solar and wind farm [projects]. In Kazakhstan we funded a project to build the first wind power farm in Akmola region. The project is under operation. We have public-private partnership projects - this is Batys Transit, also in the electric power industry – lighting dispatch, urban lighting management. In Russia our projects involving solar stations are developing very well. Our total energy portfolio is about $ 500 million, so I think this is significant.


- Does the bank have plans regarding some more green projects?

- Yes, EDB is aimed at projects focused on processing household waste, which is also an integral part of the green economy. Garbage collection and recycling is basically traditional business. But its further processing in order to obtain bio fuel is a newer topic. And I think there is a big scope for work with good prospects. We are planning such projects and it would be very interesting for us to participate in them.

In addition, a number of green projects are under discussion within the framework of cooperation with the Astana International Financial Centre (AIFC).


- In February this year EDB and Hevel Kazakhstan signed an agreement to open a credit line of 56.2 million Euros to finance solar power plant projects. There will be three of them to the best of our knowledge. What stage is the project currently at?

- We have fruitful cooperation with Hevel. Currently, a design is underway; suspensive conditions are being carried out in order to open financing straight away. The amount remains the same; we did not make any changes to the loan agreement.


- When will the active phase of investing in these projects and the construction of facilities begin?

- Investing and construction will begin next year. If, of course, they manage, then perhaps in the fourth quarter of this year, but I prefer to look on the future realistically and, most likely it will be after the New Year.


- In July, EDB, the Tajik Railways and KazakhExport agreed on purchases by Tajikistan of maneuver and mainline locomotives from Locomotive Kurastyru Zauyty JSC, freight cars and gondola cars manufactured by Kazakhstan Carriage Building Company LLP, as well as rails made by Aktobe Rail and Structural Steel Plant LLP . At what stage of implementation is this project and whether the loan amount remains the same?

- Now the list is being drafted by Tajik Railways. For the time being it is $ 35 million - this is an indicative limit. The project is to be financed under KazakhExport’s guarantee. The production of locomotives in Kazakhstan, the purchase of these products by Tajikistan and another participant in the Eurasian space, therefore, integration is obvious. I see good prospects in this cooperation format.


- Is the provisional volume of the planned purchase known?

- Tajik Railways lists up its needs and will specify when and how many products they need. We are talking about sub limits, the breakdown of which depends on the client, and not on us. There is a direct application. In any case, this is a serious deal involving inter-country relationships.

We signed a tripartite memorandum in the presence of the prime ministers of the two countries - Tajik Railways, KazakhExport and EDB. I want to emphasize this because we are not an institution that signs a memorandum for the sake of memoranda. If we sign something, we understand that this must be done and we are ready to work on it. And we are result-oriented.


- A year ago it was reported that EDB was planning to sign an agreement on financing the project at the Dzhamgyr deposit in Kyrgyzstan jointly with Kazakhstan’s company. What is the status quo of this project?

- We did not sign an agreement on it. There were objective reasons for this. But we are now examining other projects in Kyrgyzstan in the field of energy, mining and so on. We have intentions re Kyrgyz Railways, and there it’s about the application of a scheme similar to cooperation with Tajik Railways. This would be very interesting, because anyway KazakhExport is a guarantor known to us and integration is evident. At the moment I think that such format would be very comfortable for us. It might work. The application is available, just the format was supposed to be different.


- Thank you for the interview!

October, 2019
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