Law Amendment in Kazakhstan: Transition to a “green economy”


In a nutshell:

On 28 April 2016 the Kazakh parliament adopted the “Law Amending and Supplementing Individual Legislative Acts of the Republic of Kazakhstan, concerning the country’s transition to a green economy”. This law amends a range of laws, including the “Law on Support of the Use of Renewable Energy Sources”. 

This law amends a range of laws, including the “Law on Support of the Use of Renewable Energy Sources”.

According to the amendments, the approved fixed tariffs will be adjusted annually, depending on the project financing structure and economic relevance and taking into account the fluctuations in exchange rates between the domestic and the foreign currencies. The tariff adjustment procedure will be established by the Kazakh government.
In our judgement, the aforementioned amendments are aimed at supporting investors from the renewable energy sector whose equipment costs are usually in foreign currency. The government must regulate this procedure in a special regulation.

Thus, this adjustment procedure will be established only after the relevant government regulation is adopted. We assume that the legislative work on the regulation will be completed by 30 June 2016 at the earliest and this is also the date when it will be enacted.

Another novelty is that the incentives created to stimulate the construction of low-capacity power plants producing electricity from renewable energy sources and the incentives for the supply of that electricity to locations where the natural, climatic, technical or other conditions for the development of renewable energies are less favourable will be differentiated depending on the installed capacity of the power plant using renewable energy sources.
In addition, energy producers that use renewables are required to apply for concluding with a clearing and financial agency a contract for the purchase of electricity produced by plants using renewable energy sources within sixteen calendar days (instead of the previous time limit of 30 calendar days) after being included in the list of energy producers that use renewable energies.
The above-mentioned amendments came into force on 30 June 2016.  ​


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