On November 27, 2019, an auction was held to select a solar power plant design with an established capacity of 50 MW. Auctioning with documentation is a pilot project for Kazakhstan in the renewable energy market. The site for the construction of the auctioned plant is located in the Otyrar district of Turkestan region near the village of Shaulder.
Pre-project documentation was developed within the framework of a joint initiative of the Ministry of Energy of the Republic of Kazakhstan and the project by the UN Development Program in Kazakhstan “Derisking renewable energy investments”.
During 2019 the experts of the UNDP project on derisking renewable energy investments have developed a package of documents with key parameters of the project – information on connection of potential SPP to the electric grid, including all necessary approvals, preliminary environmental impact assessment (pre-EIA) with mandatory public hearings, selection and study of the land plot for construction of the potential station.
The auctions with documentation is the best world practice on organizing the auctions for selection of renewable energy projects. This practice involves auctioning the sites for which potential investors are provided in advance with information characterizing project key parameters, including necessary basic technical data of the project. This information allows to estimate possible investment and technical risks connected with selection of the land plot, development of scheme of power distribution that, eventually, promotes the offer of the lowest possible price for 1 kWh of "Green" electric energy.
The auction was recognized to be succeeded. Geography of the auction participants is represented by 6 countries, including Kazakhstan, Italy, Russia, Germany, China and the Netherlands.
The auction winner has been defined as follows:
LLP «Arm Wind» (Italy) with a price 12.49 KZT/kWh (excluding VAT).
The ceiling auction price – 29 KZT/kWh (excluding VAT) during the trading session decreased by 2.3 times.
In the course of trading session 7 companies were allowed to participate in the auction, there were 95 price proposals submitted. The total volume of proposed capacity was 350 MW. During the trading session, the applications price received from auction participants ranged from 12.49 to 29 KZT/kWh (without VAT).
In order to inform potential investors about the initiatives there were implemented several training seminars and webinars, where potential investors had the opportunity to get answers to all their questions. Also was organized a visit of potential investors directly to the site in the Shaulder village.
The success in the 2019 auction in the Republic of Kazakhstan is the result of joint work of the Ministry of energy of the Republic of Kazakhstan, the UN Development Program "Derisking of investing in the renewable energy sector", the USAID program "Future Energy", industry associations, JSC KOREM, FSC of RE LLP, JSC KEGOC and JSC NC Kazakh Invest.
Representatives of the Ministry of energy of the Republic of Kazakhstan, KazEnergy and Atameken NCE, Kazakhstan Solar Energy Association, RES Association, Kazakhstan Electric Power Association, UNDP, USAID, European Bank for Reconstruction and Development took part in the auction as observers.
The observers noted the auction to be held in accordance with approved regulatory legal acts and confirmed the transparency of electronic trading system of the auction organizer – the JSC KOREM.
According to the auction schedule, approved by the order No.97 of the Ministry of Energy of the Republic of Kazakhstan as of 19.03.2019, the auctions in amount of 255 MW of installed capacity have been held in 2019, broken down by types of power plants:
- Solar Power Plants – 80 MW;
- Wind Power Plants – 100 MW;
- Hydroelectric Power Plants - 65 MW;
- BioPP – 10 MW