Fifty-five-year-old Peishbek is a farmer who lives with his brothers in the town of Zhanatas in the Sarysu District of Kazakhstan. Peishbek has a problem with electricity. His home is not connected to the power grid, so he and his brothers use diesel to power the farm. They tried solar panels, but these soon broke down shortly after installation.
Fortunately for Peishbek and his brothers, the World Resources Institute lists Kazakhstan as one of the top three countries with the highest potential for wind-generated electricity, with winds reaching speeds of 45 meters per second. This is one of the reasons why a 100-megawatt wind power plant is being built southwest of the town. The Zhanatas 100 MW Wind Power Plant
is the Asian Infrastructure Investment Bank’s (AIIB) first onshore wind power project, first project in Kazakhstan and first AIIB-led cofinanced project with the Eurasian Development Bank and the European Bank for Reconstruction and Development.
The wind farm aims to provide a sustainable and environmentally friendly source of renewable energy for the region and allow Kazakhstan to meet its commitment to produce three percent of total energy from renewable sources. As part of the Kazakhstan 2050 Strategy initiative, the country aims to diversify its resource-heavy economy and transition to a green economy. Under this initiative, the government has set a goal for the share of electricity production by solar and wind to reach three percent by 2020 and 10 percent by 2030, increasing from less than two percent in 2018.
Kazakhstan’s fuel mix is fossil-heavy. Eighty percent of the country’s electricity is generated from fossil fuels, with hydropower accounting for 12 percent and less than one percent generated from solar and wind installations. The country’s power generating infrastructure is imbalanced and outdated. Almost half of the generating facilities in Kazakhstan are more than 30 years old. Kazakhstan’s electricity sector needs significant investments to rehabilitate outdated power assets and expand capacity to meet rising energy needs.
AIIB is helping Kazakhstan reduce the project’s financing gap by mobilizing private capital and arranging the inflow of other funding sources. The total project cost is USD136.2 million. AIIB’s loan is USD46.7 million, sponsors will provide USD40 million in equity while the rest will be funded by other financial institutions. This project will increase the Bank’s investment in solar and wind energy by 22 percent and installed capacity by 20 percent (as of December 2019).
AIIB has been promoting higher environmental and social standards with the project with in-depth stakeholder engagement, a detailed flora and fauna monitoring report and archeological survey, among others. Seven farmers, several local officials and the public governance councilor gathered at the Zhanatas community hall for the first public meeting about the wind farm construction. Concerns raised were more about archaeological surveys, local employment and the wind power plant’s impact on the environment and pastures. No other comments or grievances were expressed at the meeting and over the consultation period.
When the 3D model of the wind farm was examined by stakeholders, they did not express concerns over the 150-meter-tall wind turbines ruining the view of the horizon. Peishbek was more concerned about and interested in livelihood and energy source opportunities. During consultations, other stakeholders—such as those from the villages of Burkitbayev and Ushbas—mentioned that the turbines might even become a local attraction, something to be proud of.
Later during the course of project preparation, it was decided that the majority of construction workers involved in civil works would be sourced from Zhanatas. Preparations were made for service provision and permanent positions to be advertised in the local community during the operational phase.
Once completed, the Zhanatas wind power plant will become the largest wind farm in Central Asia. Greenhouse gas emissions can be avoided—about 260,623 tons of carbon dioxide equivalent per year. More importantly, Kazakhstan stands to generate clean electricity, approximately 319 GWh per annum or 0.3 percent of total electricity generation in the country, benefiting people like Peishbek and his farmer brothers.
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