Global Economics

Kyrgyzstan Rations Electricity


The Kyrgyz government is rationing electricity as its water reserve dwindles. Dry weather and high demand are only part of the problem

Trolleybuses stand abandoned, and cars jam intersections because traffic lights do not work. Economic activity is also at a standstill, and people return home to darkness.

Since late August, when the government imposed nationwide electricity rationing, this has been life in Kyrgyzstan. It is the first time since the dire years of the 1990s that Kyrgyzstan has faced widespread outages. Every day power is cut for eight hours in different parts of the country. The government has imposed a rotating rationing scheme to preserve dwindling water supplies from the main regional reservoir in Toktogul. Three hundred kilometers west of Bishkek, Toktogul is the largest water reservoir in Central Asia.

Due to the dry season and unusually high generating demand last winter, the volume of water in the reservoir has hit its lowest level ever, according to the national power company. It has less than 10 billion cubic meters (bcm) of water, and that figure is still going down. But to produce enough electricity in the winter, the reservoir must contain at least 12 bcm of water, the government says.

There are signs that the regular electricity cuts are damaging Kyrgyzstan's economy. Particularly vulnerable are small and medium businesses that do not have backup generators. Construction and food companies are being hit the hardest.

"I had ice cream for sale worth $2,000 and I lost it all," says Farukh, a merchant in Jalal-Abad.

Kyrgyz officials say the measures are necessary to avoid a deeper crisis during the winter. Last winter's unusually harsh weather gripped Kyrgyzstan, one of Central Asia's poorest countries. The World Bank estimates that 48 percent of Kyrgyzstan's 5.2 million people live in poverty, and it is identified as one of the countries most vulnerable to global food shortages.

"We understand that this is going to be an extremely unpopular measure, but we openly tell everybody we must do it," Kyrgyz Prime Minister Igor Chudinov told parliament last week. Otherwise, he warned, the Toktogul reservoir would be empty by February. The rationing is expected to last several weeks, until the winter heating period begins.

Many residents complain that their municipalities are not following the schedule of power cuts, which were announced in late August before the rotating outages began. "I am afraid to take the elevator as they may cut off electricity at any time and I would be stuck," said Alina, a high school teacher.

Residents of Bishkek, with a population of more than 900,000, say the outages remind them of the early 1990s when the newly independent country was in a deep economic crisis and blackouts were common. This is the first time since then that the government has imposed nationwide rationing, and power supplies, especially in Bishkek, are generally reliable.

Some experts say the current crisis should be no surprise. "Dry seasons take place periodically, and we knew that this year would bring little water," said Duyshen Mamatkanov, director of the Institute of Water Problems and Hydropower. "The bigger problem here is the disagreement between Central Asian states on how to use the transboundary rivers." In a way, he said, the current crisis is the outcome of a lack of regional cooperation in the water and energy sector.

A VULNERABLE RESOURCE

Kyrgyzstan has vast water resources—there are more than 25,000 rivers in the country—but a lack of regional cooperation and growing demand are taxing the region's water supply. Kyrgyzstan and Tajikistan, the region's two upstream countries, depend on vast water reserves to generate electricity, especially during the heating season. That means reservoirs need to be full before the onset of the peak winter months. But downstream countries—Uzbekistan and Kazakhstan—need vast amounts of water during the dry summer months to irrigate cotton and crops. The end result is year-round demand that is taxing reservoirs; and periodic droughts only compound the problem.

Mountainous terrain and water resources make Kyrgyzstan well suited for hydroelectric generation, and the country's electricity exports are a vital source of revenue because, unlike its bigger neighbors, Kyrgyzstan has few hydrocarbon assets. But it's a commodity that is particularly vulnerable to the weather and the demands of its downstream customers. During Soviet times, there was an integrated energy system that could redistribute resources during crunch times. That allowed upstream countries to regulate the level of water in reservoirs throughout the year.

The regional water management system collapsed along with the Soviet Union. But in 1998 the Central Asian states reached an agreement designed to share resources. Vadim Sokolov, deputy head of the Tashkent-based Interstate Commission on Water Coordination, explains that this deal obliged Kyrgyzstan to conserve water so its neighbors would have ample supplies for the summer irrigation season. "In return, Uzbekistan and Kazakhstan would compensate its energy shortages by supplying gas, electricity and coal," he says.

But this agreement broke down as energy prices soared. "We need to agree on such a mechanism that would redistribute the expenses for using hydroelectric facilities proportionally to the amount of water each country is using," Sokolov says.

Kyrgyzstan's current gas supply contract with Uzbekistan expires at the end of the year. But the supply contract for next year is tied up in pricing negotiations.

Kyrgyzstan opposes a mechanism like the one Sokolov suggests. Mamatkanov claims that such a system would mean Kyrgyzstan would get little in return for maintenance expenses. "Although 80 percent of the water is consumed by downstream countries, we cover all expenses on monitoring, maintaining meteorological stations, protection of hydro posts and safety. Why shouldn't downstream countries pay for all of that?"

Sokolov blames Kyrgyzstan for unilaterally changing the main purpose of the Toktogul reservoir and turning it from an irrigation to a hydroelectric facility.

Natalya Orlova, the spokeswoman for Electric Power Stations, the national power company, argues that new circumstances demanded this change. "Kyrgyzstan has to purchase energy at world prices from neighboring countries, and as a result, we had to transform the water regime to maintain our own energy security."

Ultimately, however, the reasons behind the failure to reach an agreement are not just contract costs or insufficient volumes of water. As Sokolov says, "Without the goodwill of governments, it is impossible to resolve this issue."


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