28 July 2010
Five renewable energy projects in Central Asia demonstrate the development effectiveness of such projects. A best practices model identifies the replicable elements of the projects so that international financial institutions can adopt these best practices in developing an energy investment strategy.
The Case for Renewable Energy Projects in Central Asia
Access to reliable and affordable energy is a prerequisite for economic development and poverty reduction. In addition, modern energy services contribute to social development by helping to fulfill the basic human needs of nutrition, warmth, and lighting. Meeting these essential energy needs in a sustainable way requires a balanced energy portfolio that reflects for the economic, social, and resource conditions of countries and local communities.
Majority of Central Asia’s poor live in the rural areas. Energy poverty for the rural population is exacerbated when already limited resources are dedicated primarily to urban areas. World Bank investments in Tajikistan and Kyrgyzstan favor large cities. Rural energy needs have been de-prioritized, with governments often cutting supply to populations outside major urban centers even in times when total energy supply in the country is sufficient.
Central Asian Case Studies: Examples of Successful Renewables Projects
To explore best practices for renewable energy projects in Central Asia, development experts examined five successful renewable energy projects to help inform alternatives in securing energy needs, particularly those of marginalized rural communities. Two of the cases come from Kazakhstan, two are from Tajikistan, and the final example is from Kyrgyzstan.
Solar Drier Units
The first case study enables people to utilize solar energy for a more effective and efficient drying process of fruits and vegetables during the summer and autumn. This solar drying process has improved the safety and marketability of goods in the market, and has reduced the use of organic fuel and electricity needed during the drying process. At the time of project commencement in 2004, the project benefited 22 seasonal agricultural workers from ten families (primarily women), two small businesses, and dried fruit distributors and retail vendors. This project was jointly implemented by the Women of the East non-profit organization with support from Global Ecological Facilities Small Grant Program and the local government. In addition, several local stakeholders co-invested in the project. The $32,000 project became self-sustaining within two summer-to-fall seasonal cycles – one of the fastest cost recoveries achieved in renewable projects. This project is still operational and enjoys the support of the local communities and the Enbekchi-Kazakh regional government of the Republic of Kazakhstan.
Small Wind Power for Shepherds
The second case involves the installation of wind turbines to support and sustain nomadic animal husbandry in the Karaganda oblast of Kazakhstan. The objective was to demonstrate the use of small-scale renewable projects by providing an autonomous electricity supply to mobile animal herders and farmers’ small businesses. This project was initiated by the Farmers Association in the Shetsk region of Kazakhstan in 2005, jointly implemented by the Shetsk regional government and a research initiative initiative in 2006, and co-financed by the Global Ecological Facilities Small Grants Program, the farmers’ association of agriculture workers “Azat”, the private rural enterprise “Izhe”, and the local population. The Shetsk regional and Karaganda provincial governments actively supported the project by mobilizing support from local businesses. At the time of the assessment, the project benefited 28 people in the summer and around 20 people in the winter. Windmills also provide power to local wool makers. These goods are then sold in domestic markets. Greater productivity from increased daily production, an increased number of animals and longer stay-over periods in the fields is expected to achieve payback in seven to eight years. The turbines have increased revenue by $2,000 and have allowed this design to become sustainable. This project started in 2006 and is still active.
“Akbari” Micro-Hydro Power Station
The third project studied is a micro-hydro power station (HPS) installed in a rural community in Tajikistan with the support of United Nations Development Program in 2004. The Akbari HPS supplies electricity to 21 families during the late fall and winter months. The micro hydro station keeps two businesses operating year-round and supplies 21 families with electricity for basic needs when no electricity is available through the main grid. Opportunities exist to install an additional generator to cover a greater number of households. This project was implemented and co-financed by the Akbar business and the UNDP’s financing of $29,000 with the support of the local government. Cost recovery is expected in four to five years.
“Chasmasor”Micro-Hydro Power Station
Another micro-hydro project in the Bunkagien village in southern Tajikistan was implemented by Binokor, a local non-profit organization. The micro-hydro station powers lighting and low-load appliances for 85 families, a local school with around 700 students, two mosques and several small retail shops. Electricity is available only during the fall and winter months.
The $17,200 project is jointly financed by International Fund for Aral Sea, Barki Tojik or countries main electricity utility, and the local community. International Fund for Aral Sea, which is the project’s primary donor, capped the access price per family to $2.30 a month. Some $1,600 is expected to be collected during the first year, which means cost recovery can be achieved within 10 years. The government waived taxes for this project for the first five years of operation.
Kizil-Charba Hybrid Biogas Micro Hydro Power Station
A combined four-unit biogas reactor linked to a 5 kilowatt micro-hydropower station was installed in the village of Izil-Charba in the Talas region of Kyrgyzstan. The biogas reactor can produce between eight and 25 m3 of methane per day, and during warm months the micro-hydro power station also produces electricity. The system services 22 families and produces some 100 liters of fertilizer per day as a by-product. The project has helped reduce local deforestation, supplant wood as source of energy for cooking and heating, and reduce energy costs for families. Women and children involved in cooking benefit most from this indoor-friendly fuel source. The Global Ecological Facilities (GEF)-supported project also improved space insulation with the 22 houses and organized a community-wide tree replanting.
The project was co-implemented by local stakeholders, GEF, and a non-governmental organization, “Dan”. The system was designed and built using second-hand parts. The local government donated cisterns for the biogas reactor, helped organize the community, and raised awareness about renewable energy opportunities through media.
Developing a Best Practices Model for Future Renewables Projects
Based on these five regional case studies, a best practice model for decentralized renewable energy projects has been identified. The model describes key elements of project identification, ownership, financing and achievement of sustainability. Elements of a successful community-based renewable energy project include:
- A thorough feasibility test that is conducted by experts with specialized knowledge of the local people and environment;
- Joint-financing of projects by donors and stakeholders so that project costs may be shared;
- The community must feel a sense of ownership of the project; and
- Financial sustainability must be addressed together with the community during project design.
For the model to succeed, national-level reforms and significant resources will have to become available. In this context, the World Bank can play an important role in fostering a transition towards a sustainable energy model. The proposed model is consistent with the principles and priority directions outlined in the World Bank’s Energy Strategy approach paper and regional needs of Central Asian Republics.
Read More
Best practices model in Central Asia: Sustainable energy model for rural communities, Bank Information Center, April 2010 (PDF, 263KB)