Fossil fuels dominate the power industries of the three countries. Natural gas plays a key role in Azerbaijan and Uzbekistan, accounting for 89% and 94% of last year’s power output, respectively. Kazakhstan’s energy mix is dominated by coal, which accounted for 57% of the country’s power output in 2023, with gas providing another 29%. This is caused by the high availability of natural resources: Azerbaijan and Uzbekistan were major hydrocarbon producers even in the Soviet era, while Kazakhstan, a significant coal supplier before the collapse of the USSR, has been ramping up its oil and gas production in recent decades through development operations in the Caspian oil and gas province.
At the same time, the countries of the region are developing their low-carbon energy capacities. For instance, Uzbekistan has launched 2.5 gigawatts (GW) of wind and solar generators (all other power plants have the aggregate capacity of 18 GW) over the past two years. As planned by the national regulator, the installed capacity of the country’s wind and solar generators will reach 27 GW by 2030, while their share in the energy mix will rise to 40%. In addition, Uzbekistan signed an agreement with Rosatom in May 2024 to build a small nuclear power plant (SNPP): the 330 MW project will be implemented in the Jizzakh Region in the central part of the country.
Kazakhstan also has plans for nuclear power development: it held a national referendum in October, resulting in the approval of the construction project for a large nuclear power plant in the southern Almaty Region. Rosatom, China’s CNNC, France’s EDF and South Korea’s KHNP could become the technology suppliers for the project: all four companies made the shortlist of the country’s Ministry of Energy. Kazakhstan also has great potential for wind energy development: Ember estimates the technical potential for generating electricity using domestic onshore wind turbines at 929 terawatt-hours (TWh) per year. As a point of comparison, Kazakhstan’s overall power consumption reached 112 TWh in 2023.
At the same time, Azerbaijan’s Energy Ministry estimates that the country can accommodate up to 23 GW of solar panel capacity. However, coastal wind power development holds the greatest potential in terms of renewable energy in Azerbaijan. According to the World Bank, the Caspian Sea can accommodate up to 845 GW of offshore wind turbines, of which 509 GW will be in the coastal zone. Both figures exceed the capacity of offshore power plants that operated worldwide in late 2023 (73 GW).
In order to implement the agreements signed at COP29, the power systems of the three countries will need to come together. Electricity will be generated in Uzbekistan, Kazakhstan and the Azerbaijani part of the Caspian Sea and then exported to Turkey and the EU.
