Anton Genza
On October 6, Kazakhstan held a referendum on the construction of a nuclear power plant to counteract the country’s energy deficit. The Central Asian country has set itself the goal of becoming CO2-neutral by 2060, yet it is one of the world’s largest coal-producing countries. How does that fit together?
Room for improvement with regard to energy supply
The discussion about Kazakhstan having its own nuclear power plant is not a new topic. Kazakhstan is said to have a dilapidated energy infrastructure, which repeatedly causes power outages in some regions. The thermal power plants, built primarily during the Soviet era, are outdated. Furthermore, Kazakhstan is divided into three poorly connected energy zones, which limits the potential for electricity flows over long distances. The expansion and development of the energy network are therefore the subject of heated discussion in many places.
The abundant and inexpensive coal of the largest economy in Central Asia is the most important fuel for electricity generation, accounting for around 70 percent of the total. Kazakhstan’s government is intervening heavily in the energy pricing market in favor of coal-fired power, weakening incentives for investment in renewable technologies. As a result, Kazakhstan is one of the most carbon-intensive economies in the world. In addition, Kazakhstan is one of the few countries in the world that continues to seek to promote coal-based energy.
In April 2024, it signed a cooperation agreement with Russia to build three more thermal power plants in Kazakhstan. In 2021, the Prime Ministers of Russia and Kazakhstan concluded several agreements for cooperation in the extraction and production of resources used in the energy sector, primarily hydrocarbons, with a term until 2025.
International cooperation in the energy sector
At the General Conference of the International Atomic Energy Agency (IAEA) during September this year, Director General Rafael Grossi emphasized Kazakhstan’s key role in global efforts to develop nuclear energy. He also called the referendum in Kazakhstan on October 6 “crucial to the future development of nuclear energy”. The participants of the event discussed the possibilities for the peaceful use of nuclear energy. Nuclear energy is recognized as a clean and safe source of energy. Kazakhstan actively promotes initiatives to develop nuclear power for peaceful purposes. “We ensure a stable supply of uranium to the world market, and cooperation with the IAEA has been in place for many years. […] Kazakhstan is also converting research reactors and introducing technologies for the safe disposal of irradiated fuel elements,” said Kazakhstan’s Energy Minister Almasadam Satkaliyev.
Nuclear Energy in Kazakhstan
Kazatomprom, the state-run energy company, is the national nuclear company. It has control over all nuclear issues as well as the mining of uranium. Kazakhstan has around 12% of the world’s uranium deposits and in 2022 produced the most nuclear fuel (43%). In 1999, the only Russian nuclear reactor from the Soviet era in Aktau on the Caspian Sea coast was decommissioned. The Ulba TVS plant produces nuclear fuel pellets, which in turn are used in nuclear power plants. Kazakhstan is considering exporting enriched nuclear fuel in the future instead of raw materials alone. Uranium has been mined in Kazakhstan since 1948. There are about 60 known uranium deposits. As of 2022, the sufficiently verified uranium resources amounted to 367,800 tons of elemental uranium (tU).
The Ulba Metallurgical Plant (UMP) has been in operation since the late 1940s and is responsible for several metal production and processing tasks, including uranium. The power plant, which is important for international cooperation, has frequently changed its function over the years. Today it is particularly known for the production of uranium hexafluorides in cooperation with Canada. Kazatomprom is the majority shareholder of UMP, with 34% owned by the Russian company TVEL.
In April 2015, the government approved a draft agreement with the International Atomic Energy Agency (IAEA) to establish a “fuel bank” for low-enriched uranium (LEU) in Kazakhstan. The agreement aims to make Kazakhstan a major international fuel fabrication center. Under the agreement, any state could apply to Kazakhstan for uranium fuel.
In November 2018, Kazatomprom listed on the stock exchange, with 15% of the shares placed on the Astana International Exchange and the London Stock Exchange. The state-owned company Kazatomprom was established in 1996 and 1997, respectively, to manage the government’s share in uranium mining and nuclear fuel production, as well as the import and export of nuclear material. Even before the shutdown of the only reactor in Kazakhstan, the construction of further power plants was discussed. However, the projects were postponed due to a lack of immediate energy demand.
The company maintains close links with China, Japan, Russia, France and Canada in particular for uranium mining and further processing.
Development of the energy sector
The introduction of feed-in tariffs in 2014, in partnership with the European Bank for Reconstruction and Development, provided increased planning certainty for large-scale investments in the country’s energy sector by targeting specific types of energy. This measure was designed to make the market for renewable energies, such as solar and wind energy, more competitive on the international energy market. However, by 2023, renewable energy only accounted for just under 6% of Kazakhstan’s energy production.
In 2018, the Trans-Caspian International Transport Route was developed because the port of St. Petersburg was temporarily unavailable for Class 7 nuclear material. The route, which does not pass through Russian territory, has since been retained by Kazatomprom to provide an alternative uranium delivery route. The route offers an opportunity for Europe and other Western countries, which are desperately seeking ways to achieve their emissions targets. Conversely, Kazakhstan gains in geopolitical importance, in contrast to the unwelcome Russian Federation, and can expand its international position to the benefit of investors.
Public opinion and the Soviet legacy
The consequences of more than 450 nuclear weapons tests conducted by the Soviet Union, particularly at the Semipalatinsk test site in the northeast of the country, and the harmful long-term effects on humans and nature are still present in Kazakhstan and are causing justified safety concerns among the public. Furthermore, earthquakes are not uncommon in Kazakhstan. The area around the Ulken power plant, announced by the government as the site of the plant, is about 360 kilometers from Almaty and is particularly known for an increased rate of earthquakes. In January of this year alone, an earthquake measuring 6.7 on the Richter scale was felt in the greater Almaty area.
In general, however, the majority of those surveyed – 72.9% – still support the idea of building a nuclear power plant. This figure rose steadily over the course of several telephone surveys, according to Kazinform. Despite all the potential dangers, the expansion of nuclear energy in Kazakhstan represents an opportunity for the population as a whole. Kazakhstan’s energy officials predict that power shortages will worsen over the next two years, with a deficit of 2.4 billion kilowatt-hours in 2024 and 3.3 billion kilowatt-hours in 2025. ///nCa, 25 December 2024
About the author
Anton Genza studied East Asian Studies and Journalism in Berlin. He holds an M.A. in Japanese Studies and is currently enrolled in the German Academy of Journalism. He is a freelance journalist and translator in Almaty.