Kyrgyzstan’s Kambarata-1 HPP: €2.4 Billion EU Boost for Regional Power
Brussels recently witnessed a landmark agreement that will significantly bolster Central Asia’s energy landscape, as European financial powerhouses committed substantial funding to the pivotal Kambarata-1 Hydropower Plant. The European Bank for Reconstruction and Development (EBRD) and the European Investment Bank (EIB) formally sealed their involvement, signing memorandums in the Belgian capital to jointly inject up to $2.4 billion into this ambitious initiative. This substantial financial commitment, forged during the broader Global Gateway Forum, underscores a burgeoning partnership between European financial institutions and the energy ministries of Kazakhstan, Kyrgyzstan, and Uzbekistan, aiming to enhance energy security and drive sustainable development across the region.
The Global Gateway Forum, presided over by European Commission President Ursula von der Leyen, served as a crucial platform for fortifying global infrastructure and strategic partnerships. Discussions centered on critical areas such as energy, transportation, digital transformation, and industrial competitiveness. A key highlight was the flagship ‘Global Gateway’ initiative itself, which specifically spotlighted prospects for expanding Central Asia’s hydropower resources and enhancing vital transport links, signaling a renewed European focus on the region.
This surge in investment via leading international banks like the EIB and EBRD, with a clear emphasis on regional energy projects, was a direct and anticipated outcome of the forum. It follows closely on the heels of Commissioner for International Partnerships Josef Siekela’s active tour through Central Asia, which evidently laid the groundwork for these monumental agreements. The Kambarata-1 HPP in Kyrgyzstan, strategically located on the Naryn River, emerged as the prime beneficiary, receiving the most tangible backing from EU financial institutions among several potential projects.
Upon its completion, the Kambarata-1 HPP is projected to boast an impressive installed capacity of 1860 megawatts. Its vast reservoir will hold 5.4 billion cubic meters of water, contained by a towering 256-meter dam, and is expected to generate an average of 5.6 billion kilowatt-hours of electricity annually. The construction phase is anticipated to span approximately ten years, promising to fundamentally transform the energy landscape of Central Asia. The project, with an estimated total cost ranging from $5 billion to $6 billion, represents a truly regional undertaking, with Kyrgyzstan holding a 34% stake in the joint company, matched by 33% each for Kazakhstan and Uzbekistan.
This collaborative framework was initially established through a roadmap in January 2023, culminating in a trilateral agreement on preparation and operation in 2024. A dedicated donor committee, comprising the World Bank, Asian Development Bank, EBRD, and other international partners, has been formed to coordinate financing efforts. Notably, despite the multi-national investment and participation, all assets and shares of the Kambarata-1 HPP will eventually transfer to the ownership of Bishkek upon project completion. This crucial provision ensures Kyrgyzstan’s full sovereignty over this strategically vital energy asset, with participating shares explicitly non-transferable or non-sellable.
Kyrgyz Energy Minister Taalaibek Ibraev confirmed the signing of two Memorandums of Understanding for the Kambarata-1 HPP project. One, for $500 million, was inked with EIB Director-General Andrew McDowell, and another, also for $500 million, with Regional Director Huseyin Ozhan, in the presence of EBRD President Odile Renaud-Basso. The collective European financing package, totaling up to $2.4 billion, is earmarked for Kyrgyzstan, Uzbekistan, and Kazakhstan, underscoring the strong regional approach.
EU officials lauded the agreements, emphasizing their transformative potential. Commissioner Siekela remarked, “Prudent investments in hydropower can guarantee reliable access to electricity, create income for local communities, foster sustainable agriculture, and protect public health and the environment. We are proud to support the future realization of Kambarata-1 HPP – a pivotal energy production facility for Central Asia. Our new investments reinforce the strategic partnership between the EU and the region’s nations.” EIB Vice-President Kyriacos Kakouris, overseeing the bank’s Central Asian operations, added, “Supported by European Commission guarantees, the EIB, as a climate bank, bolsters infrastructure that strengthens regional energy cooperation. We view Kambarata-1 HPP as a cornerstone for expanding renewable electricity trade, spurring economic development, and enhancing energy security.”
Further underscoring the innovative approach to the project, Kyrgyzstan recently commenced construction on the second global factory for the British company United Concrete Canvas. This facility will produce an innovative concrete fabric that could potentially be utilized in the construction of the Kambarata-1 dam. British Ambassador Nicholas Bowler, present at the groundbreaking ceremony, highlighted the project as “a shining example of friendship between the UK and Kyrgyzstan, bringing cutting-edge technology to the heart of Central Asia.” This advanced material, already proven effective in irrigation canals, significantly reduces water loss and boasts a lifespan of up to 100 years – a critical advantage for arid regions. The factory, expected to be operational by early 2027, will empower Kyrgyzstan to meet its own needs and export products across Central Asia.
Beyond Kambarata-1, the forum also touched upon other crucial regional energy initiatives, including the Rogun HPP in Tajikistan, recognized by officials as vital for the region’s energy autonomy, rational water resource management, and sustainable agricultural development. Meanwhile, Kazakhstan’s Minister Yerlan Akkenzhenov engaged in discussions with Josef Siekela and Commissioner for Neighbourhood and Enlargement Márta Kós, reiterating his country’s strategic goal of achieving carbon neutrality by 2060 and emphasizing a pragmatic, balanced approach to its green transition.
This European push into Central Asian energy development comes as Russia also signals its intent to increase investments and participation in major energy projects across the region. Russian President Vladimir Putin, speaking at the second ‘Central Asia – Russia’ summit in Dushanbe, stressed Moscow’s commitment to deploying ‘modern Russian technologies’ and integrating renewable energy sources into the regional power grid. Experts suggest that the immense energy demands and resource potential of Central Asia offer ample scope for effective cooperation with both Russia and the European Union. They argue that the contrasting yet potentially complementary nature of their investments and expertise, focused on different facets of the energy sector, can mutually reinforce rather than compete, fostering comprehensive and sustainable development throughout the region.