Includes websites relevant to selling US products and services in this country, highlighting resources for small- and medium-sized enterprises.
Last Published: 2/15/2019

Overview

Thousands of U.S. dollars
 20142015 (estimated)2016 (estimated)2017 (Estimated)
Total Local Production816,000816,000820,000900,000
Total Exports43,70045,50046,00090,000
Total Imports7,00010,00020,00050,000
Imports from the US
 		7181712,4286,577
Total Market Size779,300780,500794,000860,000
Exchange Rates4.825.517.188.8
(total market size = (total local production + imports) - exports)
Source: State Statistics Agency, U.S. Census, and U.S. Embassy staff estimates
Tajikistan’s energy sector is the most vibrant and investment intensive sector in the local economy.  Government of Tajikistan declared energy independence as the highest political and economic priority for the country.  Tajikistan’s total domestic electrical generation capacity is 6577 MW, including 5858 MW of hydroelectric capacity, and nearly 719 MW from a coal-fired combined heat and Chinese built and financed power plants  in Dushanbe and Yovon.
 
The government spends on average up to $200 million from the annual state budget to finance the largest in the country hydro energy project  - the Rogun hydro power station (3600 MW).  In September 2017 Tajikistan offered Rogun bonds to foreign investors by placing $500 million at 7.15% interest rate Eurobonds. 
 
The U.S., China, Italy, France, Germany, Russia, India, Belorussia, Kazakhstan, and Uzbekistan and number of international financial insitutions actively work in the energy sector of Tajikistan as either investors or suppliers of equipment and technical services.  
 
In addition to hydro power, Tajikistan is actively developing its coal heating power capacity with Chinese loans and technical expertise.  Tajikistan continues to pioneer the CASA-1000 project in the region.  Uzbekistan and Tajikistan relations substantially improved in 2017-2018 and Tajikistan started exports of electrical energy to Uzbekistan in April 2018 in addition to its increasing exports to  Afghanistan.
 
Most of the energy generation and energy distribution system in Tajikistan was designed and built in 1960s and 1970s.  Tajikistan’s hydropower potential is estimated at 527 billion kWh per year, which exceeds the existing electricity consumption of the countries of Central Asia by 300%. 
 
In terms of potential hydropower resources, Tajikistan is ranked eighth in the world after China, Russia, the United States, Brazil, Zaire, India and Canada.  On specific indicators of hydropower potential per square kilometer (3,696.9 thousand kWh per year/km2) and per capita (65.9 thousand kWh per year/person) Tajikistan respectively occupies first and second place in the world.  The Tajik government is implementing a two-track strategy: (i) improvement of the domestic energy sector, and (ii) development of large scale projects to generate electricity for export. 

Development will generate economic growth and create opportunities for diversification of export earnings. 
Tajikistan’s power sector is managed by Barqi Tojik, a vertically integrated utility owned by the Government of Tajikistan.  Hydropower plants generate 98% of the country’s electricity. The biggest HPP’s operated by the vertically integrated state power utility Barki Tojik are Nurek (3,000 MW), Sangtuda 1 (670 MW), Baipaza (600 MW), Golovnaya(240 MW), Sangtuda 2 (220MW), Qairakkum (126 MW), and Sangtuda 1 (670 MW).

Barki Tojik has good technical skill among its staff, but suffers from weak operational and economic management systems and a worsening financial position.  This severely impacts its ability to undertake its critical functions of planning, implementing, and supplying good quality reliable power to the consumers of Tajikistan. The ADB review of Barki Tojik in 2013, conducted under sector operational performance improvement program of the Regional Power Transmission Project, has made a bleak assessment of the utility and identified several critical weaknesses.  These related to the organizational structure, the financial reporting systems, the accounting and audit systems, the utility’s debts, the metering billing and collections system, commercial and technical losses, business planning process, management information systems, and its human resources management.  Barqi Tojik’s debts has reached almost three billion somoni (USD 385 million). 

As of February 2017, the utility owed one billion somoni (USD 110 million) to the Sangtuda-1 HPP, which is owned by Russian energy company RAO UES, and 500 million somoni (USD 54.32 million) to the Sangtuda-2 HPP owned by Iranian Sangob company and the Iranian government. 

In 2017, internal power generation was 17.1 billion kilowatts-hours (kWh) with an internal consumption of 12.8 billion kWh. The high reliance on hydropower generation results in a power surplus in summer and a deficit in winter.

Due to limited resources and low electricity tariffs, the Government of Tajikistan relies on donor resources from the World Bank, Asian Development Bank, German KfW, Islamic Development Bank, European Bank for Reconstruction and Development, Chinese government, Russian government, Iranian government, German government, U.S. government, and other donors to develop and maintain the energy production and distribution network in Tajikistan.

The commissioning of additional generating capacities and measures taken to improve efficiency of electrical use resulted in fewer electricity outages during the autumn-winter period 2017-2018 for the first time in recent years.

In accordance with the Development Strategy and Investment Rehabilitation Program of Tajikistan, a number of organizational and technical measures are being implemented in the energy sector of the Republic of Tajikistan, including: reforming the management structure of national Utility Barqi Tojik with the division of activities between generation, transmission & distribution segments; increasing the new generation capacities, by construction of new facilities and the modernization of existing generating stations; development of the transport infrastructure of the energy system; Improving energy efficiency using modern automated control systems.
The total investment in the Tajik energy sector amounted to more than three billion US dollars since 2000. Currently, a number of projects at the implementation stage that will ensure safety of work and increase the electricity export potential.

Rehabilitation of  Sarband  HPP is ongoing.  After project completion, the total power capacity of HPP will increase from 240 MW to 252 MW.   Reconstruction of Qairakkum HPP will increase generation from 126 MW to 170 MW. Currently, the project is at the tendering stage and GE Hydro is in a strong position to win this project.  Within the framework of the Regional Electric Power Transmission Project in Tajikistan, two 220 kV transmission lines with a total length of 140 km have been constructed, six high voltage substations have been modernized, and the SCADA EMS system of the upper level system has been completed by GE Grid.  The Energy loss reduction program has also been successfully implemented in Tajikistan’s power grid.

Bidding procedures to select the winner for CASA 1000 project is at the final stage.  Successful implementation of this project will enable Tajikistan to become the biggest energy exporter in Central Asia. The available volume of electricity exports from Tajikistan and Kyrgyzstan under this project, which is scheduled to commence in 2021, is about 5.5 billion kWh.  One of the priorities for ensuring Tajikistan’s energy security and the efficient use of available water and energy resources is integration into the energy systems of Central Asia, in particular by connecting to the power grid system of Uzbekistan.  At present, the interstate power lines are connected from the Regar 500 kV substation to 500KV substation Surkhan (Uzbekistan) and Regar 220 kV to 220kV Gulcha substation. These connections are the first step to ensure mutual supplies of electricity.

Leading Sub-Sectors

Tajikistan is the next importer of energy related equipment and technologies.  The following table represents some selected but not limited to energy related sub-sector categories of products:
HS Code Item description
8402 Steam or other vapor generating boilers (other than central heating hot water boilers capable also of producing low pressure steam); super-heated water boilers. 
8404 Auxiliary plant for use with boiler, condensers for steam and vapor power units. 
8406 Steam turbines, vapor turbines. 
8410 Hydraulic turbines, water wheels, and regulators. 
8411 Turbo jets, turbo propellers and other gas turbines. 
8502 Electric generating sets and rotary converters. 
8503 Parts suitable for use solely or principally with the machines of heading No.  85.01 or 85.02
8504 Electrical transformers, static converters and inductors
8532 Electrical capacitors, fixed, variable or adjustable (pre-set)
8535 Electrical apparatus for switching or protecting electrical circuit, or for making connections to or in electrical circuits, for a voltage exceeding 1000 volts
8536 Electrical apparatus for switching or protecting electrical circuit, or for making connections to or in electrical circuits, for a voltage not exceeding 1000 volts
Tajikistan’s electricity system is strained financially by low tariffs, poor collection, and large receivables from major consumers, including TALCO.  Tajikistan’s electricity prices were kept very low until 2007, and while they have gradually increased since then, the prices are still below the cost of supply and remain among the lowest in the world. At $0.023 per kilowatt-hour, the current residential tariff is half that of Uzbekistan’s and 20% of Moldova’s.  Although the Asian Development Bank (ADB) provided significant financial and technical assistance, the needed major rehabilitation of the dilapidated power system and adding of new capacity would require higher tariffs to cover the full cost of expansion.  These highly subsidized and below cost-recovery tariffs, combined with winter shortages, reportedly result in huge economic losses of around $200 million a year or 3% of GDP .  To reduce the winter shortages, the government needs to take measures to improve energy efficiency on the demand side in addition to supply expansion.  On the demand side, energy prices need to reflect the full cost of supply, which would then encourage electricity consumers to use it more efficiently.  Measures should also be taken to avoid losses and minimize excessive usage.  Governance at TALCO needs to be improved with the end in view of using electricity more efficiently.  Likewise, efficiency improvements on the supply side could include controlling corruption and mismanagement and increasing generation capacity at power plants.  Along this line, the government should also take steps to minimize the quasi-fiscal deficits of state-run generator Barqi Tojik by addressing weakness in its billing and collection mechanisms.  In the long run, Tajikistan needs to generate more electricity through hydropower to improve the overall business environment and thereby address the problem of low private investment.  However, this will require substantial investment as well as reliable markets for summer exports—a challenge that would require careful planning and coordination of the country’s legal, institutional, and fiscal infrastructure.

Opportunities

Tajikistan has enormous hydropower potential, but only a small fraction is being developed, primarily due regional context, trans boundary water issues, lack of regional integration of energy markets especially between North and South. Since 2017, the decline in political tensions between Uzbekistan and Tajikistan have opened up new opportunities for energy sector development in Tajikistan. The Government of Tajikistan is marketing a number of small, medium, and large hydropower projects on three main rivers: the Zarafshon, Vakhsh and Panj.
 
Potential hydroelectric power station projects in Tajikistan include:
 
 Vaksh RiverProjected Capacity (MW)
1Rogun                                    3,600
2Shurob                                       750
 Obi Hingou River 
3Sangvor                                       800
4Urfat                                       850
5Shtien                                       600
6Evtaj                                       800
7Kaftarguzarskaya                                       650
 Surhob River 
8Djalbulak                                       600
9Sairon                                       500
10Gorgen                                       600
11Garm                                       400
 Panj River 
12Dashtijum                                    4,000
13Barshorskaya                                       300
14Anderobskaya                                       650
15Pishtskaya                                       320
16Horogskaya                                       250
17Rushan                                    3,000
18Yazgulem                                       850
19Shirgovatskaya                                    1,900
20"Granitniy Vorota"                                    2,100
21Hostavskaya                                    1,200
22Djumarskaya                                    2,000
23Mosvoskaya                                       800
24Kokchinskaya                                       350
25Verhneamudarinskaya                                    1,000
  Zerafshan river 
26Matchinskaya                                         90
27Riomutskaya                                         75
28Oburdonskaya                                       120
29Pahutskaya  -1                                       130
30Pahutskaya  -2 
31Iskanderdkulskaya                                       120
32Yagnobskaya                                       150
33Ravatskaya                                         50
34Fondarinskaya                                       300
35Zahmatabadskaya 
36Sangistanskaya                                       140
37Vishkanskaya                                       160
38Yavanskaya                                       160
39Dupulinskaya                                       200
40Penjikent -1                                         50
41Penkikent -2                                         45
42Penjikent -3                                         65
43Dargskaya HPS 
 Varzob River 
44Pugus                                      16.2
45Gushar                                         17
 Kafirnihan River 
46Vistan                                         54
47Sarvoz                                         42
48Yavroz                                         90
49Bagjiddin                                       125
50Lower Kafirnigan                                         72
Source: U.S. Embassy staff estimates and Ministry of Energy and Water Resources
Web Resources
Project Management Group for Energy Facilities under the President of Tajikistan
(http://www.energyprojects.tj/index.php?lang=en)  
 
Open Joint Stock Energy Company Barki Tojik (http://www.barkitojik.tj)  
 
CASA project (http://www.casa-1000.org/)
 
EBRD Energy projects in Tajikistan
(https://www.ebrd.com/cs/Satellite?c=Page&c32=on&cid=1395238314964&d=Mobile&pagename=EBRD%2FPage%2FSearchAndFilterPSD&s11=on)
(https://www.ebrd.com/work-with-us/projects/psd/qairokkum-hpp-climate-resilience-upgrade.html)
(https://www.ebrd.com/work-with-us/projects/psd/cross-regional-power-trade.html)
(https://www.ebrd.com/work-with-us/projects/psd/sugd---energy-loss-reduction-project.html)
 
ADB energy projects in Tajikistan
(https://www.adb.org/projects/country/taj/sector/energy-1059)
(https://www.carecprogram.org/?event=energy-sector-coordinating-committee-meeting-mar-2018)
(https://www.carecprogram.org/?event=carec-senior-officials-meeting-jun-2018)
 
World Bank energy assessment projects in Tajikistan
(http://www.worldbank.org/en/country/tajikistan/brief/final-reports-related-to-the-proposed-rogun-hpp)
 

Prepared by our U.S. Embassies abroad. With its network of 108 offices across the United States and in more than 75 countries, the U.S. Commercial Service of the U.S. Department of Commerce utilizes its global presence and international marketing expertise to help U.S. companies sell their products and services worldwide. Locate the U.S. Commercial Service trade specialist in the U.S. nearest you by visiting http://export.gov/usoffices.