Afghanistan to get major transit revenues from CASA-1000 project


   2015-08-21

BISHKEK (TCA) — The Central Asia South Asia (CASA-1000) electricity transmission project was signed by water and energy ministers of Kyrgyzstan, Tajikistan, Afghanistan, and Pakistan on April 24 in Istanbul, promising to Afghanistan $45 million in transit revenues per year. 

 

Based on last October's agreement between Kabul and Islamabad over transit pricing, Afghanistan will receive 1.25 cents from each kilowatt of electricity that will pass from Kyrgyzstan and Tajikistan to Pakistan through Afghanistan, TOLOnews reported. About 570 kilometers of the future electricity transmission lines will cross Kunduz, Baghlan, Panjshir, Parwan, Kabul and Nangarhar provinces of Afghanistan. Construction is expected to start in September 2015 and completion is planned by May 2018.

 

The World Bank Group’s Board of Directors in 2014 approved $526.5 million in grant and credit financing for the Central Asia South Asia Electricity Transmission and Trade Project (CASA-1000) for four countries: Afghanistan, Kyrgyz Republic, Pakistan, and Tajikistan. This transmission infrastructure project will put in place the commercial and institutional arrangements as well as the infrastructure required for 1,300 megawatts (MW) of sustainable electricity trade. The total project cost is estimated at $1.17 billion and several other development partners will provide financing for CASA-1000, including the Islamic Development Bank and United States Agency for International Development.

 

CASA-1000 will build more than 1,200 kilometers of electricity transmission lines and associated sub-stations to transmit excess summer hydropower energy from existing power generation stations in Kyrgyz Republic and Tajikistan to Afghanistan and Pakistan. The project will finance the engineering design, construction, and commissioning of transmission lines and three new converter stations.  The power generation stations that provide the energy to be traded over CASA-1000, including Toktogul in Kyrgyzstan and Nurek in Tajikistan, are already in place, according to the World Bank.

 

Nearly 400 million people in South Asia lack reliable access to electricity. Both Afghanistan and Pakistan rely heavily on oil for power generation. Cleaner and affordable electricity imports from Central Asia will enable improved service, reduce shortages over the critical summer period, and lessen the financial pressure of fuel imports.

 

Kyrgyzstan and Tajikistan have abundant hydropower, but power generation capacity exceeds national needs during the summer and is insufficient during the winter. Exporting surplus electricity during the summer will help the two countries generate the revenues they need for priority energy sector investments, particularly to cover energy shortages during the winter. The sale of Tajik electricity through CASA-1000 will come exclusively from existing surplus generation from May to September in order to maintain the seasonal pattern of water flows and winter power generation.

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