Kazakhstan Electric Power Industry Key Factors

List of the Wholesale Electricity Market Participants 23.04.2025
List of consumers of electric power market 23.04.2025
Analysis of the wholesale electricity and capacity market for 2023

The electric power industry in Kazakhstan includes the following sectors: 

  • electricity generation;
  • electricity transmission;
  • electricity supply;
  • electricity consumption;
  • other activities in electric power industry. 

Electricity generation sector

Electricity in Kazakhstan is generated by 233 power plants of various forms of ownership. As on 01 January 2025 the total installed capacity of power plants in Kazakhstan was 25,314.2 MW and available capacity is 21,034.6 MW. Power plants are classified into: nationally significant power plants, industrial power plants, regional power plants.

Nationally significant power plants include large thermal power plants, which generate and sell electricity to consumers in the wholesale electricity market of the Republic of Kazakhstan:

  • Ekibastuz GRES-1 named after Bulat Nurzhanov LLP
  • Ekibastuz GRES-2 Power Plant JSC
  • Power plant of EEC ERG JSC, Eurasian Group;
  • Topar main distribution power plant LLP
  • Zhambyl GRES named after T.I. Baturov JSC 

Additionally, large hydropower plants are used to supplement and regulate the load schedule of the Unified Power System (UPS) of Kazakhstan:

  • Bukhtarma Hydroelectric Complex, KazZinc LLP
  • AES Ust-Kamenogorsk HPP LLP
  • AES Shulbinsk HPP LLP

Industrial power plants include CHPPs (combined heat and power plants) that produce both electricity and heat, supplying large industrial enterprises and nearby settlements with power and heat. These include:

  • CHPP-3 Karaganda Energy Centre LLP 
  • PVS CHPP, CHPP-2 of Arcelor Mittal Temirtau JSC
  • CHPP of SSGPO JSC, ERG, Eurasian Group
  • Balkhash CHPP, Zhezkazgan CHPP Kazakhmys energy LLP
  • CHPP-1 of Aluminium of Kazakhstan JSC, ERG, Eurasian Group and others 

Regionally significant power plants are CHPPs integrated with local territories, supplying electricity through regional power grid companies and transmission organizations, while also providing district heating for nearby cities.

Electricity Transmission Sector

Power grids of the Republic of Kazakhstan are a set of substations, switchgears and interconnecting transmission lines of 0.4-1150 kV, designed for transmission and (or) distribution of electric energy.

The national power grid (NPG) serves as the backbone of the unified power system (UPS) of the Republic of Kazakhstan, providing electrical connections between the regions of the republic and the power systems of neighbouring countries (the Russian Federation, the Kyrgyz Republic, and the Republic of Uzbekistan), as well as delivering electrical energy from power plants and transmitting it to wholesale consumers. Substations, switchgears, interregional and (or) interstate power transmission lines and power transmission lines supplying electric power from electric power plants with a voltage of 220 kV and above, which are part of the UPS, are on the balance sheet of KEGOC.

The regional-level network provides electricity connections within regions, as well as transmission of electricity to retail consumers. The regional-level networks are maintained and operated by regional network companies (hereinafter, RNCs).

Electricity transmission companies (ETCs) transmit electricity through their own or used (rent, leasing, trust management and other types of use) networks to consumers on the wholesale and retail market or to electricity supply companies on the basis of contracts.

Electricity supply sector

Until April 1, 2024, the retail electricity market of the Republic of Kazakhstan was supplied by both regulated and non-regulated electricity supply organizations (ESOs). From April 1 to December 31, 2024, non-regulated ESOs ceased operations, transferring their consumers to regulated ESOs. Starting from January 1, 2025, all electricity supply functions have been transferred to electricity transmission organizations that have obtained a license for electricity supply A total of 21 licensed electricity transmission organizations purchase electricity from the single electricity buyer, renewable energy sources, and/or net consumers, then resell it to end retail consumers. These organizations also perform the role of "guaranteed electricity suppliers."

Electricity market of the Republic of Kazakhstan

The wholesale electricity and capacity market in Kazakhstan consists of:

  • The wholesale electricity market
  • The balancing electricity market
  • The capacity market
  • The system and ancillary services market

The wholesale electricity market operates on the basis of buying and selling planned electricity volumes, which are included in the daily production-consumption schedule approved by the system operator.

The real-time balancing electricity market functions to physically and subsequently financially settle hourly imbalances that arise during operating days between actual and planned electricity volumes.

System and ancillary services market operates based on both:

  • The purchase of ancillary services from wholesale electricity market participants
  • The provision of system services by the system operator to wholesale electricity market participants

The purpose is to ensure compliance with national reliability standards of the Unified Power System (UPS) of Kazakhstan and to maintain electricity quality standards.

The capacity market is designed to attract investments for both the maintenance of existing and construction of new generation capacities within the UPS of Kazakhstan to meet the demand for electrical capacity.

Centralized electricity trading refers to purchase and sale transactions conducted between:

  • Electricity-generating companies and the single electricity buyer
  • The single electricity buyer and digital miners, within an electronic trading system.

The wholesale electricity market participants include entities listed in the registry compiled by the system operator, such as:

  • Electricity-generating organizations, including those utilizing:

-         Renewable energy sources (RES)

-         Secondary energy resources

-         Energy recovery from waste

  • Electricity transmission organizations
  • Electricity supply organizations
  • Wholesale electricity consumers
  • Digital miners

To be included in the registry, a legal entity must enter into the following agreements:

  1. Agreement for the provision of services for use of the National Power Grid (NPG) with the system operator
  2. Agreement for the provision of electricity transmission services through the NPG with the system operator (if required)
  3. Agreement for the provision of electricity transmission services with electricity transmission organizations (if required)
  4. Agreement for the provision of electricity generation and consumption balancing services with the system operator
  5. Agreement for the provision of technical dispatching services for electricity generation and consumption with the system operator (if the entity operates generation facilities or engages in electricity imports)

At the same time, agreements for the provision of system services are concluded with:

Electricity consumers, provided their average daily (base) power consumption is at least 1 MW;

Electricity supply organizations (with a valid license for electricity procurement for supply purposes) that meet the requirement of supplying at least 1 MW of average daily (base) power consumption.

Additionally, the wholesale electricity market participants also include:

  • The system operator
  • The centralized electricity trading market operator
  • The single electricity buyer

Single Electricity Purchaser and Settlement Centre of the balancing electricity market

As of July 1, 2023, amendments to the Law "On Electricity" came into effect, regulating the operation of the wholesale electricity market with the introduction of the Single Electricity Purchaser and the real-time balancing electricity market.

The target market model envisions a transition to centralized purchase and sale of planned electricity volumes. This means that all electricity generated by power producers is sold to the Single Electricity Purchaser. The only exception is the direct purchase and sale of electricity between consumers and electricity-generating organizations that belong to the same corporate group.

Electricity is centrally procured from domestic power plants one day in advance, according to the following priority order:

  1. Electricity-generating organizations using renewable energy sources (RES) that have long-term contracts with the Single Electricity Purchaser
  2. Combined heat and power plants (CHPs)
  3. Electricity-generating organizations with long-term capacity market contracts
  4. Any remaining required electricity volumes are procured through electronic centralized trading on the KOREM JSC trading platform and sold to wholesale buyers.

If domestic power plants are unable to fully cover the daily electricity schedule, planned electricity imports are carried out.

At the same time, the real-time balancing electricity market ensures the settlement of imbalances within the Unified Power System (UPS) of Kazakhstan, distributing them among market participants responsible for deviations.

Participation in the balancing market is mandatory for all wholesale electricity market participants.

The centralized purchase and sale of electricity on the balancing electricity market (BEM) for imbalance settlement is conducted by the Balancing Market Settlement Centre.

By orders of the Ministry of Energy, dated June 6, 2023:

  • Financial Settlement Centre for Supporting Renewable Energy Sources LLP was designated as the Single Electricity Purchaser.
  • KOREM JSC was designated as the Balancing Market Settlement Centre.

To ensure the operation of the new market model, in accordance with the Law "On Electricity", and based on relevant agreements, the system operator provides market participants with:

  • Use of the National Power Grid (NPG)
  • Electricity transmission services through the NPG

The NPG use service is provided to wholesale market participants when they conduct electricity purchase and sale transactions on both the wholesale and balancing electricity markets. This is due to the lack of direct allocation of electricity distribution (i.e., it is impossible to determine the exact transmission route from producer to consumer).

The system operator will provide electricity transmission services via the NPG to the following entities:

  1. The Single Electricity Purchaser, when exporting electricity
  2. Wholesale market participants importing electricity, excluding the Single Electricity Purchaser
  3. Conditional consumers (industrial complexes), when supplying electricity to facilities within their structure, as well as from the Single Electricity Purchaser and the Balancing Market Settlement Centre
  4. Wholesale electricity market participants, when purchasing electricity from renewable energy sources (RES) under bilateral contracts
  5. Authorized organizations of other countries, when conducting interstate electricity transmission via the National Electricity Grid

With the transition to the new model, KEGOC continues to play one of the main roles in the market and performs the following main functions:

Provides system services, including the new “NPG use service”.

Operates the modernized hardware-software complex – the Balancing Market System, which serves as the primary tool for the operation of the wholesale electricity market and balancing market management, integrating the "Single Electricity Purchaser" and "Balancing Market Settlement Centre" modules

Physically settles electricity imbalances within the energy system by activating price bids from domestic market participants, ranked in a prioritized list, as well as through contractual agreements for deviation settlement with the Russian Federation and Central Asian countries.

Link to the website of the Balancing Electricity Market System for Wholesale Electricity Market Entities:  https://bems.kegoc.kz/

 


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