Dear readers,
On June 29, 2024, the Law "On Amendments and Additions to Certain Legislative Acts of the Republic of Kazakhstan on Support for the Use of Renewable Energy Sources and Electric Power" came into force, except for certain provisions.
The amendments are aimed at developing support for renewable energy sources (RES) and small-scale generators, as well as supporting the modernization of energy networks.
These changes are introduced into the Entrepreneurial Code, the Law "On Electric Power" and the Law "On Supporting the Use of Renewable Energy Sources."
The Entrepreneurial Code now includes a provision that eliminates the need for registration as an individual entrepreneur for individuals engaged in the production of electrical and/or thermal energy or the sale of electrical energy produced by a small-scale renewable energy source. Now, individuals have the right to determine the need for registration as an individual entrepreneur themselves.
The Law "On Electric Power" introduces the following provisions to support the development of alternative energy sources:
- The concept of "Net Energy Consumer" has been introduced. This includes individuals and legal entities that partially or fully meet their own consumption of electrical and/or thermal energy from a small-scale renewable energy source, owned by them either through property rights or other real rights, connected to the distribution electric network, and equipped with systems for separate accounting of electricity consumption from the network and supply volumes to it, including combined renewable energy installations.
- Priority purchase of electricity from small hydropower plants by energy supplying organizations. The rule on priority purchase applies to hydropower plants with a total installed capacity of no more than 10 megawatts, located within their service area, commissioned before 01.07.2023, and not having long-term power purchase agreements with a single buyer as of 01.07.2023, at the marginal tariff for electricity established in accordance with Article 12-1 of the Law "On Electric Power."
- Changes to the conditions for concluding investment agreements for the modernization of generators using gas as an alternative fuel. Energy-producing organizations with existing power plants located in cities of republican significance are entitled to conclude investment agreements for the modernization, reconstruction, and/or expansion with the construction of generating installations using gas as an alternative fuel for the main equipment generating thermal and electric energy.
- The right to amend the investment program. Now, the procedure for concluding an investment agreement allows for amendments to the corresponding investment program based on documents confirming changes in the technical and economic indicators of the measure during the period when the authorized body is making a decision on the conclusion (or refusal to conclude) the investment agreement.
- The tariff for the service of maintaining electrical capacity readiness will consider the total amount of investments. The investment agreement will include the tariff for the service of maintaining electrical capacity readiness as a variable amount over the years, considering the return of investments for the main equipment generating thermal and electric energy, within the framework of the investment program for modernization, reconstruction, and/or expansion with the construction of generating installations using gas as an alternative fuel, including rewards for corresponding investment loans, considering the purchase term of the service for maintaining electrical capacity readiness (in months) and the volume of this service.
From August 20, 2024, amendments to the Law "On Electric Power" concerning the financing of the construction, reconstruction, and modernization of electrical networks of regional electric grid companies in communal ownership will come into force.
The Law "On Supporting the Use of Renewable Energy Sources" also introduces the following changes concerning net consumers:
- The introduction of a similar concept of "Net Energy Consumer" as in the Law "On Electric Power."
- Definition of a small-scale renewable energy source. This includes technical devices with a total installed capacity of up to 200 kilowatts (inclusive), designed for the production of electrical and/or thermal energy using renewable energy sources, and associated structures and infrastructure technologically necessary for the operation of the small-scale facility.
- Establishment of principles for state regulation in the field of supporting the use of renewable energy sources. These include energy and environmental security, the safety of human life and health, environmental protection when using renewable energy sources, balancing the interests of subjects in the field of renewable energy support, achieving obligations to increase the share of renewable energy in the generation structure, and the investment attractiveness of using renewable energy sources.
- Targeted assistance is excluded and replaced by support for net consumers. The specific measures of support for net consumers are not detailed, but targeted assistance for reimbursing part of the costs of individual consumers for the purchase of renewable energy installations of Kazakh production is excluded.
From August 20, 2024, amendments to the Law "On Supporting the Use of Renewable Energy Sources" will come into force, changing the powers of the Ministry of Energy and defining the terms of contractual relationships between the energy-supplying organization and net consumers when connecting the latter to the networks of the energy transmission organization as consumers.