Activists exchange views on solving energy crisis in Uzbekistan

Due to chronic power outages, the situation has worsened especially in the country’s hospitals. Videos are circulating which show that patients are being operated on by candlelight or there is no electricity to vacuum up premature babies.

CNG filling stations are temporarily closed or working intermittently.

Against the background of such problems, social networks are filled with posts of people’s dissatisfaction with the electricity and heating supply. They are telling the government that the money allocated for electricity and gas, the benefits given to the companies in the sector, and the subsidies that are increasing year by year are not profitable.

But so far, no official has spoken about the detailed overview of the crisis and the solutions.

Electricity and gas shortages in Uzbekistan are the result of deep, systemic problems. The energy system is not privatized, the state monopoly operates in the field. The system is technically obsolete due to lack of private investment. On top of that, there are international agreements that are said to be against the country’s national interests, high levels of corruption, massive thefts at gas stations, inefficient state-owned enterprises and factories that consume large amounts of energy. As long as such issues are not resolved and reconsidered, the industry will not be improved, and the problems will not be solved.

But now it is impossible to stand still or wait. The government should take steps to get people out of this winter that has just come before solving the big issues. So what urgent steps should be taken today to improve energy supply?

Kun.uz correspondent asked the opinions of several interlocutors who are aware of the current state of the industry in this regard.

Alisher Kadirov, Deputy Speaker of the Legislative Chamber

First, despite losses, damages and accidents, gas and electricity transmission should continue as much as possible, as was done in previous years.

Secondly, it is necessary to deliver coal and liquefied gas to the remote places, specifying the personal responsibility of the governors. Energy companies must ensure the purchase of sufficient quantities of coal and liquefied gas.

Thirdly, the sole responsibility is given to the Ecology Committee, it is necessary to prevent random cutting of trees by preparing firewood only from dry (!) trees and supplying firewood to the most needy households with the recommendation of the authorities.

Fourth, we should consider gradually banning the use of methane gas in vehicles and switching to propane.

Fifth, it is necessary to start a large-scale promotion of austerity throughout the country.

Sixth, of course, it is necessary to start working on the program for the privatization of the energy market sales part as soon as possible.

Mirodil Jalolov, founder of EPSILON foreign company

Of course, today’s energy crisis in Uzbekistan is not something that can be solved in a day or a month.

In my opinion, it is now possible to significantly increase gas production from wells approved for gas exploration and drilling in the country. For this, the government should sit down with the gas producing companies and study their potential. For example, we have enough opportunity for this.

Second, the government should think about gas imports today. But it must be through gas miners, directly through a contract, without various foreign, partner companies. In this case, Uztransgaz should provide transportation only through main pipelines. Then the effect of the work will be higher.

In this, first, state subsidies to the industry will be reduced. Secondly, the funds allocated directly to gas production will increase.

Subsidy means state budget, public money. We have long ago given our suggestions to industry experts on how this system should work.

Our offer is as follows: the actual cost of domestically produced gas (real costs without partners) is much cheaper than the price of imported gas. If we mix domestically produced gas with imported gas, the average cost comes out. Then its average selling price comes out. These imports should only be from Turkmenistan and Kazakhstan and not from others.

Also, today is the high time to review the agreements that were made against our national interests (the experience of Israel and Indonesia).

The implementation of additional capacities for electricity supply in Tashkent and Syrdarya regions from private coal-fired power producers in Kazakhstan through seasonal SWAP operation will help to reduce the deficit. At the end of the season, these volumes can be recovered by re-exporting them to Afghanistan.

Abdulla Abdukodirov, an economic analyst

In order to fundamentally improve the situation in the gas industry of Uzbekistan, the following actions should be implemented.

First, it is necessary to call consulting companies with a high reputation in the international arena and audit the state of existing gas reserves and fields, the quality and results of geological exploration. We need to know exactly what the situation will be like in the perspective of 3, 5, 10 years, what awaits us.

Second, the existing production sharing agreements and export agreements should be published and extensively examined. Perhaps another consulting company will deal with this. The goal is to revise them taking into account the interests of Uzbekistan.

Thirdly, it is necessary to study the activities of the enterprises in the sector operating in the territory of Uzbekistan in all fields and to develop measures to increase their efficiency.

Fourthly, the government should review all contracts with gas producing companies, link the benefits to the volume of gas supplied and create equal opportunities for all. Service tariffs of infrastructure enterprises should be the same for everyone. In general, there should be no discrimination against local businesses in the network.

Fifth, import contracts should be renegotiated for the long term and without partners. Another point should be noted: if today the government wants to conclude a gas contract with anyone, it should be Turkmenistan or Kazakhstan, but not Russia at all. This will be another big mistake on top of our mistakes. It will be very difficult to correct its consequences.

Sixth, advance payments should be given to local enterprises on the condition of increasing the volume of gas.