OREANDA-NEWS. December 02, 2008. The World Bank’s Board of Directors approved IDA credit and grant in the total amount of US 11 million for the Energy Emergency Assistance Project, reported the press-centre of World Bank.

The Energy Emergency Assistance Project finances the provision of equipment, materials, and spare parts to increase power and heat generation at the Bishkek and Osh Combined Heat and Power Plants (CHPs). In particular, fuel oil, coal handling equipment, and other equipment and materials are being supplied for repair of the equipment in CHPs.
 
The project will be implemented within 16 months. In the long term the country will need to take measures to improve efficiency as the level of losses is about 40% and there is a need to bring institutional efficiency in the sector through reform of corporate governance, and implementation of modern management systems. In addition, adding new capacity will require significant level of investments, which will require mobilizing financing.
 
Hydroelectricity-dependent Kyrgyz Republic is facing a dry hydrological cycle, compounded by the harshest winter seen in decades.  Due to uncertain hydropower production during the winter, supporting thermal production at the thermal power stations of Bishkek and Osh is critical as this facilities supply not only power, but also heat to the major cities of the country, which is key to mitigate the cold season. Power plants in Bishkek and Osh are major providers of heat for the district heating systems of the major cities of the country, and they employ coal as the primary fuel and either natural gas or fuel oil as secondary fuel.

The water level in the Toktogul reservoir is the crucial determinant of the energy availability in the country. Of the total installed capacity of 3400 MW, hydroelectric capacity accounts for about 80% and the remaining is CHP capacity of about 700 MW in Bishkek and Osh CHP plants. However, in actual production, the dependence on hydroelectricity is almost 90% since the current capacity of the CHPs is down to less than 200 MW. In addition, the Naryn hydroelectric cascade accounts for 90% of the hydroelectric capacity, with the large Toktogul reservoir -with a storage capacity of 19 billion cubic meters (bcm)- being the main reservoir that enables the regulated operation of the cascade.

The World Bank is one of the largest sources of development assistance to the Kyrgyz Republic.  From July 2005 – July 2008, the Bank provided all funding to the Kyrgyz Republic on a grant basis.  Current terms for Kyrgyzstan are: 45% grants, and 55% highly concessional credits with no interest, and a 0.75% service charge.  Credits are repayable in 40 years, including a 10-year grace period.