Could you brief us
on the activities of your company and the structure
of shareholders?
The last recent years I was leading the whole
Kyrgyz energy sector. All reconstruction and reforming
of energy sector had passed under my management.
Nowadays the sector is divided into three blocks:
producing of energy and thermal energy, transmission
of energy, distribution and selling of energy.
Today instead of one company "Kyrgyzenergo"
we have seven companies. One company for electricity
generation without taking into account the small
hydro plants. The one company on electricity transmission
is called "Kyrgyz National Electric Grid
". It includes some station lines from 110
kilowatts up to 500 kilowatts. There are five
companies on distribution and selling of electricity.
Since recent times I am leading the company on
transmission of electricity. The name of the company
is " National Grid of Kyrgyzstan".
Is this company governed by the state alone?
This is a normal joint stock company. 80,5% of
all shares belong to the government, 13% belong
to the social fund, the rest 7,5 % belong to the
private investors: physical persons and legal
entities, minor shareholders. All together they
make up 15 000 and the structure is changing.
Briefly, 7,5% belongs to 15 000 shareholders.
Naturally, 93,5% of all stocks can not be privatized
without the permission of the government. We are
doing only the transmission of electricity within
the republic and also export it.
What will you consider about the strategic
importance of the National Grid as the main transmitter
of electricity in Kyrgyzstan?
It mainly depends on the export possibilities,
particularly, of the lines. The possibilities
of the national electric lines are strong enough
in order to provide the electricity within the
country without any problems. But there is one
problem here that one part of lines was built
on the territory of Uzbekistan and Kazakhstan.
But we can pay the sum without problems, though
we don't pay any sum today. So, here we do not
have any serious problems. But when it will concern
the export, I think, that we will have some problems,
because the possibilities of hydropower resources
of the republic are very big. But nowadays the
oil products (gas and fuel oil) are more available
and cheaper, therefore, the need for hydropower
is less. You know that hydro energy is the renewed
kind of energy supply and their possibilities
in the future are also big. Early or later, of
course, it will be demanded. If at the moment
there is a struggle for the places, where they
are extracting oil, like Kazakhstan, in Arab countries
and in the Caspian Sea, I am sure, that in some
time there will be struggle for getting these
hydropower plants. But I can not say that it will
be tomorrow, or in 5 years or 10 years.
What are the export volumes of electricity?
It is fluctuating. The export to our neighbor
countries Uzbekistan and Kazakhstan makes from
1 billion kilowatts to 3 billion. I would say
that for such a country as Kyrgyzstan it is rather
a big volume. By using all the hydropower resources
we could export up to one thousand billion kilowatts
per year. And in this case, it will be like in
Kuwait.
What is the actual potential for exporting
electricity not only to Uzbekistan and Kazakhstan,
but also perhaps China can become an export market
for electricity. How big of foreign exchange earner
can hydropower generation become for Kyrgyzstan?
You know, it's easy to say but it is very difficult
to implement. Because any country would try to
solve all these needs by its own resources. So
do China and other countries, and only need will
force them to import. I think that at certain
point in the future this need will be in China.
During the last 20 years the installed capacity
of the Chinese hydro power stations has been increased
in three times. They have increased from 65 000
megawatts up to 215000 megawatts. Nowadays, several
stations are being built, which could in near
years cover their needs. We have two points, the
successful solving of which could influence the
policy. The first one is covering the Tarumi deposit,
are there at all the forecasted resources. Our
Chinese colleagues are of the opinion that there
are those resources. But according to available
information these forecasts are not confirmed.
Of course, if they will find a great quantity
of oil in this place, there will be also a huge
quantity of fuel oil. Therefore, they will have
to build some stations for the processing of fuel
oil. This is the first side of the question. In
this case they will try to cover all internal
needs by their own resources. The other side is
that they signed the Kyoto agreement. This will
give limitations for them. Either they will have
to built very costly stations or instead of buying
the quotas it would be better to buy electricity
from us. I believe that America will also sign
the Kyoto agreement, it will not stay alone. If
it would not sign in year 2008, it will sign by
year 2013. Concerning Europe, we can see that
many natural disasters are taking place. If these
disasters will be repeated two or three times
more, USA will also sign this agreement. I think
that these two factors will influence to the covering
of additional power stations. We shouldn't throw
away from our attention those countries such as
India, Pakistan and Iraq, because gas and fuel
oil aren't for ever. The demand is great. Of course,
they will not sit on the secondary technologies
from Europe. There will be time when they will
come to the high technologies. They have too much
people. I think that they have and will have more
and more clever people. This process can't be
stopped.
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Therefore, I think that
the power, that coming from Naryn will be mastered.
Concerning the prices. For today the price for electricity
in the hydropower stations worldwide is fluctuating
from 2 to 6 cents. Let's say that it will be 4 cents
in the future. It will be 100 billion kilowatts
by 4 cents and it will equal to 40 billion dollars
and it will be enough for Kyrgyzstan to my point
of view.
Do you need to have the infrastructure for
the export?
The need creates necessity for creating this
infrastructure.
What comes first: infrastructure, demand or
generating of electricity?
There should be demand. For today there is no
demand. As soon as there will be need for that,
we will find money. Why I do not want to promote
and crave for it, because big quantity of energy
requires much more money. The Soviet Union has
started three stations and they were about to
finish one of the stations - Kambar-Ata 1, 2,
3. Nowadays, they are conserved. In order to finish
the construction of these stations we need 2.5
billion dollars. A simple person doesn't have
such money and even some countries doesn't have.
This can be covered only by big corporations.
I can tell you what kind of corporations they
are: Siemens, ABB, General Electric and maybe
Mitsubishi. These companies are coming here annually.
Every year they are doing reports on those objects.
As soon as they see that there is demand for this
or that object they will immediately find the
money. Of course, they do not have in their pockets
such amounts at once, they will refer to international
banks as they trust them and could grant such
a loan. The banks will not trust this money to
me or Kyrgyzstan. May be in ten years the situation
will change, but there will be still such companies.
Naturally, if they will see that there is no market
for this electricity, they will not ask for this
money. It is for sure, that they will build themselves
those power stations.
Nowadays, we have very detailed research on how
to transmit the electricity to Pakistan. Concerning
these three stations, they have very detailed
projects. If the Kyrgyz government gives guarantee
for 2.5 billions dollars, I would not accept it.
Because our budget has only 200 mln dollars a
year. Nobody would accept such guarantee. For
today to create the infrastructure for transmitting
the electricity is silly.
Do you think that Kyrgyzstan needs to be promoted
that people need to know that there is such a
country with certain possibilities for investment?
Naturally. We should tell them that there are
such opportunities. We have here hydropower resources,
which can be covered. Of course, we should start
to do it from today.
Why not then?
Today it will not be covered. I think that in
5 years there will be movement. We know the report
of the American specialists to the USA congress.
In this report they have already started to pay
attention to this issue. Naturally, it will be
funded for researching and we are not only talking
about the hydropower energy, but also the second
one - the windmills. Few years ago I was in the
Scandinavian countries, and there I saw how this
was being widely mastered and it was surely subsidized
by the government of Scandinavia as they could
allow themselves to do it. Of course, we have
to talk about it but not to wait for considerable
effects in next 5-10 years. I think that we have
all resources: gas, oil and etc., which are available
in the world in rather good quantity, but they
are located too deep. In this case the mountains
are barriers for us. At certain point we will
have to consider: whether it's cheaper to use
hydropower energy or extract oil from mountains.
Not talking about the other chemicals on Mendeleev's
table. There are also quite enough of them. I
think that the high technology in the future can
not be made without such chemicals.
What message would you send to investors?
It is difficult to say now. I would like that
people would know that we have such resources.
Here we have also great wealth - glacier and unsalted
water. For today there is no price for that. It
should be appraised. We must work on this. We
must raise up these issues. In the last report
of the Scientists' Academy of Russia there is
one issue, which was raised up, that Russia has
25% of fresh water of the world, 30% of the forestry,
25% of mineral resources. It makes Russia like
a "storehouse" of all resources in the
world. And why do all other countries use them
free of charge? We can also raise up this issue.
We may, of course, use the worst version. We may
spread some black powder on the glaciers, and
the water would melt down. We could use these
zones as pastures.
I consider that hydro resources will be covered
in the nearest 10 years. Concerning tin, tungsten
and other elements the movement will start in
5 years and we should start to talk about those
things right now or should have start already
yesterday.
Probably Minister of Agriculture had mentioned
already, that we have ecologically sound products.
We have also very well educated youth, and their
labor can be appraised very lowly. We can put
production here and it would be very cheap. If
in some countries one need to train the people
about on year and here one need just to show once
how to do it and they will learn. If we will not
use this possibility rather quickly, we will loose
it. There are no illiterate people in the country.
It is a great prosperity.
I agree with the point that our region is not
stable, but it does not refer to all the zones.
The northern part is stable, nothing threatens
there. China is next to the north part, and it
would not allow to have unstable situation, the
same with Kazakhstan. Development of Kazakhstan
makes one really happy, and it forwards ahead
with huge steps.
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Mr. Bakirdin
Sartkaziev