Introduction

Central Asia, a region historically powered by the might of fossil fuels, stands at the cusp of a transformative era. As the winds of change blow, the potential for renewable energy to drive a new epoch of prosperity is more palpable than ever.

The shift from fossil fuels to renewable energy in Central Asia is framed not only as a necessity for environmental sustainability but also as a strategic economic opportunity. The region stands to benefit from enhanced energy security and affordability as it moves away from reliance on fossil fuel imports.

Central Asia's push towards greening its economy is underpinned by substantial investments in clean technologies, which not only aim to reduce emissions but also enhance the region's competitiveness in a global market increasingly leaning towards carbon taxes on imports, like the European Union’s (EU) Carbon Border Adjustment Mechanism. These investments are critical as the region is one of the highest per capita carbon emitters globally and faces severe economic risks without significant action on climate adaptation​.

This transition is supported by international initiatives and programmes such as the World Bank’s Europe and Central Asia Renewable Energy Scale-up (ECARES) programme, which aims to deploy 15 GW of renewable energy across the region by leveraging regulatory support, grid modernisation, and innovative financing. It is also being backed by an influx of $8.9 billion in green finance from multilateral development banks between 2015 and 2021. This substantial investment is part of a broader initiative to propel the region's economies towards environmentally friendly practices and technologies

This shift is not only a response to the global sustainability drive but also a potential avenue for addressing gender inequalities in the workforce. The transition to green energy is seen as a chance to integrate women into new sectors, potentially reshaping both the energy landscape and gender roles within the economy.

This article delves into the emerging revolution, highlighting the economic, environmental, and strategic benefits that beckon a brighter, greener future, and why it matters on a global scale.

 

Fossil Fuel Dependence

The global shift towards sustainability has placed the region at an energy crossroads. With the mounting urgency of climate change and economic diversification, Central Asia's leap towards renewable resources reflects a significant geopolitical reorientation and a decisive step toward sustainable development.

Central Asia's potential role in breaking China's dominance in the rare earth elements (REEs) market can significantly influence the region's move towards renewable energy. These elements are crucial for the manufacture of technologies like high-storage batteries and other high-tech applications vital for the energy transition. As China controls a significant portion of the global REE market with it controlling over 85%, diversifying these supply chains with resources from Central Asia could enhance the region's economic growth, thereby supporting its shift away from fossil fuels​.

 

The Green Awakening: Economic and Environmental Balance

The transition to renewables is not merely an environmental imperative but an economic one. Central Asia's vast steppes and deserts hold untapped potential for solar and wind energy generation, capable of powering not just local needs but addressing international demands. This green awakening could invigorate local industries, spur job creation, and initiate technological advancements, laying the groundwork for a resilient, future-proof economy.

Kazakhstan is advancing clean energy, with initiatives like a significant wind project by UAE's Masdar aimed to align with its 2030 goal of increasing renewable energy capacity to 15% of its energy supply. It is emerging as a leader in green hydrogen production, aiming to produce two million tons annually by 2032. Furthermore, the introduction of green bonds in Kazakhstan, as part of the Damu Fund's strategy, marks a pivotal movement in green financing aimed at supporting small and medium-sized businesses. This strategic shift not only enhances the competitiveness of local industries but also aligns with global sustainability goals, offering a resilient blueprint for economic growth.

Uzbekistan too is becoming a key player in green energy, capitalising on its substantial potential of 2,091 billion kWh for electricity generation—an amount 30 times greater than its current annual consumption. With around 320 sunny days each year, the country has exceptional solar energy capabilities, with a total capacity of 2,058 billion kWh, and also boasts considerable wind energy resources, particularly in the northwest and southwest. In recent years, it has entered into 21 agreements with international firms. At present, 19 solar projects (totalling 3,977 MW) and seven wind power stations (totalling 3,100 MW) are under development, supported by over $9 billion in foreign investment. By 2026, Uzbekistan plans to bring online more than 8,000 MW of solar and wind capacity and 868 MW of hydropower, underscoring its commitment to transitioning to green energy.

The Kyrgyz Republic also holds substantial renewable energy potential, with an annual capacity of 5,000 million kWh from hydropower, 490 million kWh from solar, and 45 million kWh from wind. Despite utilising only 10% of its hydropower resources, the country is expanding its energy mix, including a 100 MW wind project in Issyk-Kul and a 300 MW solar station. In 2022, it partnered with Kazakhstan and Uzbekistan to build the Kambar-Ata-1 hydroelectric power plant, set to be the largest in the country.

Turkmenistan's landscape holds promising potential for mining essential materials like iron and copper ores, which are crucial for the development of renewable energy infrastructures such as electricity grids. The availability of these materials can foster significant economic growth and support the broader transition.​ The Presidential Programme for Social and Economic Development (2022-2028) emphasises the adoption of renewable energy, including domestic solar panel production. Notable projects include Çalik Enerji's planned 10 MW hybrid solar-wind station, supported by a $25 million investment from the Abu Dhabi Development Fund, and a 100 MW solar photovoltaic station in collaboration with Masdar. Additionally, Turkmenistan is exploring hydrogen investments.

Central Asia is rich in potential not only for solar and wind energy but also for hydropower, owing to its significant river networks and mountain ranges like the Pamir and Tien Shan. However, much of this potential remains untapped, with countries like Tajikistan and Kyrgyzstan only using a fraction of their available resources. By fully developing these resources, Central Asia could not only meet its own energy needs but also export electricity to neighbouring regions, further reducing the reliance on fossil fuels​.

According to a World Bank report, shifting away from fossil fuels enhances energy security and stimulates economic growth by leveraging the region's abundant renewable resources. This strategic deployment of resources is crucial to bolstering both local economies and regional economic resilience. There is an emerging discussion around the role of women in these industries. Historically, women have been underrepresented in energy sectors, but the green transition presents a unique opportunity to bridge this gap. Initiatives aimed at empowering women through education and training in relevant green skills are critical to building a more inclusive workforce.

The shift towards sustainable energy sources is significantly influenced by the strategic investments from the UAE and Saudi Arabia. Masdar and ACWA Power are at the forefront of this transformation, engaging in extensive renewable energy projects across Uzbekistan, Kazakhstan, and Kyrgyzstan. These initiatives include the development of solar and wind power facilities, aimed at increasing the region's renewable energy capacity and significantly cutting carbon emissions.

In addition to this, initiatives like the ECARES programme are expected to not only bolster the energy sector's sustainability but also drive economic growth by creating up to 900,000 jobs by 2040 for the region. This economic stimulation is supported by the decrease in renewable technology costs, making projects more feasible and appealing for international investment. Besides this, investment in green technologies is seen as a necessary step for Central Asia to secure a more sustainable economic future. The region is advised to spend upwards of $1.1 trillion by 2060 to decarbonise its energy systems, highlighting the scale of commitment needed to transform its energy landscape. These investments are expected to yield returns by creating new markets, improving energy security, and reducing dependence on imported fossil fuels​. The urgency of these efforts has been further emphasised by Russia's invasion of Ukraine, which has exposed the risks of over-reliance on fossil fuel imports from geopolitically unstable regions.

The Geopolitical Effect

Central Asia's renewable revolution also holds the keys to altering the region's geopolitical ties. Reducing reliance on traditional energy exports could diminish vulnerabilities to global oil price fluctuations and foster a new era of energy diplomacy.

The geopolitical dynamics surrounding Central Asia’s energy transition are profoundly shaped by Western interests, which are strategically oriented towards reducing dependency on Russian and Chinese energy and resource dominance. This shift is driven by Western nations' objectives to diversify global energy sources and diminish the monopolistic control exerted by Russia and China over critical raw materials and energy markets. The EU has adopted a "de-risking" strategy aimed at reducing its dependency on China without completely severing economic ties. This approach involves diversifying supply chains, investing in alternative sources of critical raw materials, and fostering partnerships with regions like Central Asia. By reducing the risks associated with over-reliance on a single supplier, the EU aims to ensure a stable and secure supply of REEs, which are vital for its ambitious green energy goals. Meanwhile, the United States is pursuing a more pronounced strategy of "decoupling" from China which involves reducing economic interdependence by relocating supply chains, encouraging domestic production, and forging alliances with other nations. Central Asia's rich REE reserves present an opportunity for the US to secure alternative sources, thereby diminishing China's leverage in these strategic markets.

In the case of Russia, its escalated energy cooperation with Central Asia, particularly in the wake of its geopolitical isolation following the 2022 invasion of Ukraine, reflects a strategic signalling to secure alternative markets and reinforce its geopolitical leverage in the region. Facing unprecedented sanctions and the loss of European energy markets, Russia has redirected substantial volumes of hydrocarbons to Asia, with Central Asia becoming a key focus due to its proximity and historical ties. The region's energy infrastructure, much of which is Soviet-era and highly deteriorated—such as Kazakhstan's energy assets with an average deterioration rate of 66% in 2023—has made Central Asian countries increasingly reliant on Russian energy supplies. This cooperation extends beyond mere supply; Russia is involved in building and modernising power generation capacities, including plans for a tripartite gas union with Kazakhstan and Uzbekistan to facilitate gas transit to China. The geopolitical implications are profound, as this deepening energy dependence risks tethering Central Asia more closely to Moscow’s sphere of influence, particularly within frameworks like the Eurasian Economic Union, where Russia's energy prices are claimed to be significantly lower than those in Europe. This increased reliance on Russian energy underscores a potential erosion of regional autonomy and a shift in Central Asia’s geopolitical orientation, amidst ongoing Western investments that are more focused on long-term renewable energy projects rather than addressing immediate energy deficits.

We must not ignore China's actions in the renewable energy landscape in Central Asia, where its intensified engagement since 2018 highlights a strategic pivot from traditional fossil fuel projects to renewable energy investments. By moving from debt financing to equity investments and collaborating with local development banks, China not only aligns with global trends towards sustainable development but also seeks to establish a dominant role in the sector. This evolving strategy underlines China's intent to influence technological standards and market dynamics in Central Asia.

Furthermore, Central Asia is integrating nuclear power into its energy strategies. On May 27, 2024, Moscow and Tashkent agreed to construct Central Asia’s first nuclear power plant, with Russia's state nuclear company Rosatom set to build up to six reactors in Uzbekistan. Meanwhile, Kazakhstan is proposing legislative changes to incorporate nuclear power into its national energy plan, with a projected plant cost of $10-12 billion, contingent upon a national referendum. The region, with Uzbekistan as the fifth-largest uranium supplier and Kazakhstan as the leading global producer, sees nuclear energy as essential for economic growth and climate adaptation. Despite past interest from international investors, including attempts by China and collaborative workshops with the U.S., Russia remains the dominant player in the nuclear sector. Rosatom's significant market share in uranium enrichment highlights its geopolitical leverage, although recent U.S. legislative moves aim to reduce reliance on Russian nuclear fuel.

Policy reforms in countries like Uzbekistan and Kazakhstan, which include commitments to carbon neutrality and expansion of renewable energy, signify a geopolitical shift towards sustainable development too. The establishment of the Green Hydrogen Hub in Uzbekistan, supported by USAID, exemplifies a significant geopolitical shift. This move enhances its geopolitical autonomy and opens up new avenues for international energy alliances. Similarly, Kazakhstan’s clean energy commitments were highlighted at international forums like COP28, where significant agreements were signed, demonstrating the country's strategic move and its role in international energy diplomacy​. The county has demonstrated significant progress in its renewable energy sector, currently operating 146 renewable energy facilities, each with a capacity exceeding 100 kilowatts (kW).

 

Why This Matters: From Regional to Global Impact

The implications of Central Asia's energy transformation extend beyond its borders. The World Bank highlights that this shift not only promises a more stable economic environment but also redefines geopolitical ties. By decreasing reliance on traditional energy exports and embracing renewable energy, Central Asia could reshape its international relationships and economic dependencies. This transition is framed as a strategic reorientation that could enhance the region's geopolitical stature and influence in the global energy landscape​. The successful implementation of these strategies in Central Asia could inspire and inform energy policies globally, underlining the interconnectedness of regional actions and global impacts. Successful integration of women into the green economy could serve as a model for other regions, showcasing how sustainable development can also promote social equity. While the region pivots towards renewable resources, integrating a gender perspective into policies and actions is also crucial to ensure that women participate equally in this new economic future.

A successful renewable pivot could serve as a model for other fossil fuel-reliant economies, proving the viability of sustainable growth and acting as a blueprint. It can also contribute significantly to global emission reduction efforts, demonstrating that economic prosperity and environmental stewardship can coexist. Central Asia's commitment to integrating ESG principles, as demonstrated by collaborations with the IFC in enhancing microfinance ESG capacities, highlights the region's move towards a sustainable economic model. This not only aids local development but also contributes to global sustainability efforts, demonstrating the potential for regional initiatives to make a worldwide impact.

Conclusion

As Central Asia harnesses the power of the sun and wind, it seeks to chart a course of prosperity, redefine its role on the world stage, and participate actively in the global fight against climate change. The region's green pivot is not just a tale of energy strategy but also a narrative of hope and ambition. However, it is fundamental to simultaneously recognise the broader global context in which this transformation unfolds. The reality of this shift remains complex and contested. Despite widespread advocacy, renewable energy has yet to replace fossil fuels as the dominant global energy source, with fossil fuels still accounting for 84% of global consumption.

The current energy transition policies, while aspirational, often inadvertently bolster China’s competitive advantage by shifting production to regions with cheaper, more reliable energy sources. This not only benefits China but also poses significant challenges for Western economies, which face deindustrialization and increased energy costs. The push towards renewables, though necessary, has yet to address these fundamental imbalances. By leveraging its vast renewable resources, the region could set a precedent for integrating ESG principles and driving economic growth while mitigating the environmental impact. Yet, the success of this transition will depend on how well Central Asia can navigate global politics. Hence it is imperative to balance ambitious climate goals with practical and equitable energy policies.

This transition, while fraught with challenges, carries profound significance for policymakers, and global citizens alike, making it a revolution worth following.