Turkmenistan (2012)

Degree of reliance on imported energy: 

<p>
Turkmenistan is a net exporter of electricity. Electricity is exported to Afghanistan, Iran, Tajikistan and Turkey. Export to Pakistan via Afghanistan is being investigated.</p>

Main sources of Energy: 

<p>
Installed power generation capacity (2008): 4,104MW. About 40% is constituted of gas-turbine generators.<br />
<br />
Apart from the Russian Federation, Turkmenistan has the largest proven gas reserves of any of the former Soviet republics &ndash; believed to be the fourth largest in the world at 22.9 trillion m3. Many gas fields have been discovered in the west near the Caspian Sea but the most significant resources are located in the Amu-Daria Basin in the east. The natural gas deposits have so far proven too risky for international oil and gas companies to exploit.<br />
<br />
Virtually all electricity and heat are generated from natural gas because of the country&rsquo;s significant reserves. The Power Sector Development Strategy stipulates that electric power production will be increased up to 35.5 billion kWh by 2030, supported by the construction of three gas-fired plants with a combined capacity of 1.12GW.<br />
<br />
Large sections of the population do not pay for electricity because of state subsidies. These subsidies tend to render market conditions for renewable energy (RE) projects unfavourable.<br />
&nbsp;</p>

Country: 

Turkmenistan

Extent of the network: 

<p>
Turkmenergo State Corporation is the state-owned electricity producer and operator of the electrical grid. There is near universal access to electricity. The rural electrification ratio is 99.6%.</p>

Capacity concerns: 

<p>
The electrical grid system is inefficient, poorly maintained and requires upgrade. In February 2010, Schneider Electric of France and ENEX of Belgium were contracted to upgrade the electricity networks in the capital, Ashgabat. The modernization of the system will be conducted in three phases and is expected to be completed in 2017.</p>

Potential for Renewable Energy: 

<p>
<i><b>Hydro</b></i><br />
Hydropower constitutes only 5MW to the country&rsquo;s power generation capacity. Most of the hydropower potential is concentrated in the Murgab and Amu-Daria river basins. The largest small hydropower potential is concentrated in the southern part of the Republic on the Murgab and Tejen rivers and the Karakumy canal. No hydroelectric power plants are planned in the near future.<br />
<br />
<i><b>Wind</b></i><br />
The region near the Caspian Sea holds the highest wind potential along with the large desert zone. In total, approximately 40% of the territory holds wind energy potential suitable for power generation. It is estimated that 10GW could be developed in the medium term and potentially 500GW in the long term. Such quantities may even rival the country&rsquo;s natural gas reserves.<br />
<br />
<i><b>Solar</b></i><br />
Turkmenistan has a relatively high solar potential also. A few solar experimentation centres have been used for food drying and water desalination. Solar energy technology has not been exploited despite the significant potential.<br />
<br />
<i><b>Biomass</b></i><br />
Biomass opportunity has not been well studied. Up until 2007, biomass did not contribute to the power generation mix.<br />
<br />
<i><b>Geothermal</b></i><br />
The geothermal potential has not been fully investigated - information on geothermal potential has only been obtained from tests carried out on exploration and production oil and gas wells. The total theoretical heat capacity has been estimated to be 6,600MWt. Geothermal reservoirs have been discovered in the following areas:</p>
<ul>
<li>
Caspian Coast: thermal brines with temperatures of about 80&deg;C, total dissolved solids (TDS) of 50-100g/l, flow rates of 250-1400l/s.</li>
<li>
Darvaza Region (Central Kara-Kum): depths of 3000-3500m, temperatures up to 100&deg;C, TDS of 150g/l.</li>
<li>
Kopet-Dag Foothills: depths of 2000-2500m, temperatures of 70-80&deg;C, flow rates of 15-55l/s.</li>
</ul>
<p>
<br />
&nbsp;</p>

Potential for Energy Efficiency: 

<p>
Turkmenistan&rsquo;s potential for energy efficiency has not been quantified. Factors such as the non-existence of consumer energy metering (gas, electricity and heat) and the aforementioned state subsidy of electricity make such quantification difficult.</p>

Ownership: 

<p>
<i><b>Electricity market</b></i><br />
The electricity market in Turkmenistan is comprised of the vertically integrated state-owned monopoly - the Turkmenenergo State Corporation - which was established in 2005. Its assets include:</p>
<ul>
<li>
eight central heating plants,</li>
<li>
six regional vertically-integrated companies,</li>
<li>
an electricity networks enterprise,</li>
<li>
a company responsible for electric lighting of the city of Ashgabat (the country&rsquo;s capital),</li>
<li>
a state body for electricity sector control, and</li>
<li>
other auxiliary companies.</li>
</ul>
<p>
<br />
<i><b>Petroleum and Gas</b></i><br />
The state monopoly &ndash; Turkmengas State Concern &ndash; operates in the gas sector. This sector has not been privatised or liberalised though the Law on Hydrocarbon Resources (e.g. Article 37 &ldquo;Title to pipeline transport&rdquo;) allows for private ownership of gas-related infrastructure at the Government&rsquo;s discretion. The 2008 Law on Foreign Investments facilitates:</p>
<ul>
<li>
foreign investment in enterprises jointly with Turkmenistan nationals,</li>
<li>
the establishment of enterprises fully owned by foreign investors,</li>
<li>
the establishment of branches of foreign entities, and</li>
<li>
the purchase of existing enterprises and certain types assets as dictated by legislation.</li>
</ul>
<p>
<br />
Established quotas are supplied to the population free of charge.</p>

Structure / extent of competition: 

<p>
The electricity sector is comprised of the single vertically-integrated state-owned corporation; this is not expected to change in the foreseeable future.</p>

Existence of an energy framework and programmes to promote sustainable energy: 

<p>
Policy developments in the energy sector have been focused on greenhouse gas (GHG) mitigation measures. The following objectives relating to the energy production sector have been defined:</p>
<ul>
<li>
increase in the fuel efficiency power plants by modernisation of combustion systems,</li>
<li>
increase in the share of natural gas in the energy balance, and</li>
<li>
increase in the share renewable sources of energy in the energy balance.</li>
</ul>
<p>
<br />
The following objectives relating to the energy and heat consumption sector have been defined:</p>
<ul>
<li>
increase in the energy efficiency in municipal services and in industry,</li>
<li>
modernisation of heating systems, and</li>
<li>
the application of energy saving measures in the residential and industrial sectors.</li>
</ul>
<p>
<br />
<i><b>Clean Development Mechanism (CDM)</b></i><br />
Turkmenistan ratified the United Nations (UN) conventions relating to environmental protection and nature conservation, including the UN Framework Convention on Climate Change (UNFCCC) in 1995 and the Kyoto Protocol in 1998.</p>
<p>
<i><b>Strengthening the Policy Framework for Sustainable and Rational Use of Energy and Alternative/Renewable Sources of Energy (2010-2012)</b></i><br />
The United Nations Development Programme (UNDP) will provide Turkmenistan with assistance to enhance its policy framework for energy-efficient practices and RE by engaging with all stakeholders in the energy sector and introducing international best practice, experience and standards. The key issues this project aims to address are the strengthening of Turkmenistan&#39;s capacity to introduce effective legislation on RE and supporting Turkmenistan in ensuring that such legislation is compatible with international standards.<br />
<br />
Other programmes that address aspects of climate change, nature conservation and environmental protection are:</p>
<ul>
<li>
The national Basic Directions of Social and Economic Development of Turkmenistan for the Period until 2010 Program, and</li>
<li>
The national Strategy of Economic, Political and Cultural Development of Turkmenistan for the Period until 2020, and</li>
<li>
The National Environmental Action Plan (NEAP).</li>
</ul>

Current energy debates or legislation: 

<p>
The Law of Turkmenistan on Energy Saving is currently being drafted. This law covers all aspects of energy saving relating to both production and consumption and the governance framework for energy saving policies at the national level.</p>

Major energy studies: 

<p>
NA</p>

Role of government: 

<p>
<i><b>Ministry of Finance</b></i><br />
The Ministry of Finance is responsible for all matters relating to tariffs.<br />
<br />
<i><b>Ministry of Energy and Industry</b></i><br />
The Ministry of Energy and Industry is responsible for management of the country&rsquo;s electricity sector, including management of Turkmenenergo.<br />
<br />
<i><b>State Agency for the Management and Use of Hydrocarbon Resources</b></i><br />
This agency was established in 2007 to manage the country&rsquo;s oil and gas sector. The Agency assumed all powers previously vested in the Ministry of Oil and Gas Industry and Mineral Resources such as the issuance of licences for exploration surveys. The Agency also negotiates agreements with contractors and sets rules for all companies operating in the country.</p>

Government agencies in sustainable energy: 

<p>
Turkmenistan established a Designated National Authority (DNA) for the assessment of CDM projects at the Office of Climate Change within Ministry of Nature Protection. However, up until October 2009, no project had been registered.<br />
<br />
There are only three domestic organisations known to be involved in the development of RE technology. The most notable is the Sun Scientific Production Association affiliated with the Supreme Council for Science and Technology under the President of Turkmenistan. This organisation carries out research relating to the use of RE sources and is responsible for virtually all experimental projects implemented in the country thus far, including:</p>
<ul>
<li>
wind power,</li>
<li>
solar drying technology for farms,</li>
<li>
integrated wind and solar power complexes for generating electricity and pumping water,</li>
<li>
development of solar &ldquo;photaic&rdquo; bioreactors for breeding microscopic algae, and</li>
<li>
solar furnaces for high-temperature studies.</li>
</ul>

Energy planning procedures: 

<p>
There exists no specific policy or programme for the promotion of RE solutions. However, the Law on Energy Saving currently being drafted covers GHG emissions reduction measures and partly covers RE solutions.</p>

Energy regulator Date of creation: 

<p>
There is no independent regulatory authority for the energy sector.</p>

Degree of independence: 

<p>
NA</p>

Regulatory framework for sustainable energy: 

<p>
The petroleum sector is regulated through the Petroleum Law of Turkmenistan of 1996. The law allows the issuance of operation licenses for registered foreign entities. The Law on Hydrocarbon Resources of 2008 spells out fiscal and customs policies, defines benefits to be enjoyed by national and foreign investors and companies and reinforces their ecologic accountability for exploration of hydrocarbon resources. The law allows foreign investors to buy property in Turkmenistan.</p>

Regulatory roles: 

<p>
NA</p>

Role of government department in energy regulation: 

<p>
The Ministry of Economy and Finance is responsible for general licensing issues.</p>

Regulatory barriers: 

<p>
Due to the absence of a specific programme for the promotion of RE, there exists no regulatory framework relating to RE.<br />
&nbsp;</p>

References: 

International Energy Agency (2008): Country Description &ndash; Turkmenistan. Available at: http://<a href="http://www.iea.org/countries/non-membercountries/turkmenistan/">www.iea.... [Accessed 9th September 2013]<br />
<br />
European Bank for Reconstruction and Development, 2009. Turkmenistan: Country Profile. Available at: <a href="http://ws2-23.myloadspring.com/sites/renew/Shared%20Documents/2009%20Cou... [Accessed 9th September 2013]<br />
<br />
Balliyev, K., Jorde, K. and Biegert, A. 2009. Country Chapter: Republic of Turkmenistan. Available at Available at: <a href="http://www.giz.de/Themen/en/dokumente/gtz2009-en-regionalreport-turkmeni... [Accessed 9th September 2013]