The Resolution of the President of the Republic of Uzbekistan No. PP-4422 dated August 22, 2019, (The "Resolution") focuses on improving of electricity consumption efficiency by implementing modern mechanisms and standards in construction, providing compensation for installing energy-efficient equipment, as well as other measures. It should be emphasized that this document is the second of its kind. The first one was the Resolution of the President No. PP‑3012 dated May 26, 2017, "On the program of measures for further development of renewable power generation, enhancement of energy efficiency in sectors of the economy and social sphere for 2017-2021".
The Resolution approves the Complex program for enhancing the energy efficiency of sectors of the economy and the social sphere, the implementation of energy-saving technologies and the development of renewable energy sources in the Republic of Uzbekistan in 2019-2020 (The "Complex program").
Individuals are given subsidies worth 30% of the cost (within certain limits) of purchasing solar photovoltaic stations, solar water heaters, energy-efficient gas-heating devices, as well as of the interest expenses on bank loans for the purchase of stations of renewable energy sources, energy-efficient gas-heating devices and boilers, as well as other energy-efficient equipment.
The Resolution sets out a procedure under which, starting from January 1, 2020:
- there are compulsory requirements on energy efficiency for the design, reconstruction and construction of all buildings and structures, except for individual housing constructions, in accordance with construction norms and rules, and there must be a section on energy-efficiency indicators for buildings and structures in compliance with the requirements of construction norms and rules during expert examination of design documents;
- state bodies and organizations are obliged to install sensors, combined with LED sources for lighting systems, and energy-efficient gas-heating devices in their buildings and structures;
- a determination of the class and technical indicators for energy efficiency of production equipment, goods and technology is compulsory during certification by the accredited bodies in the Republic of Uzbekistan.
To support the ongoing reforms, by November 1, 2019, the Ministry of Energy together with the Agency "Uzstandart" shall:
- review the planning regulations and rules to radically increase the requirements for the energy efficiency of new buildings and reconstructed buildings and structures;
- develop and approve normative documents on the identification of classes of energy efficiency for buildings and structures (classes А, B, V, and others).
Stage-by-stage implementation of the energy management system in compliance with international standards (ISO 50001) at nearly all local entities and organizations is planned to start on December 1, 2019, and end by January 1, 2023.
The Ministry of Energy and the Agency "Uzstandart" shall:
- do an inventory within a month of existing normative documents on standardization, which set the requirements concerning energy efficiency, energy-saving technologies and equipment;
- approve within two months a scheme of acceptance of necessary international standards related to energy efficiency and energy-saving technologies and equipment;
- approve a "Roadmap" for the creation of modern laboratories to test energy-consuming equipment for compliance with energy-efficient and energy-saving indicators.
The Resolution prohibits the import of previously used power-generating equipment, power-reducing transformers, electric motors, as well as energy-consuming equipment of category D into the territory of the Republic of Uzbekistan starting from September 1, 2019.
The Resolution states that the drafts of normative legal acts and programs for the implementation of renewable energy sources are subject to mandatory approval by the Ministry of Energy of the Republic of Uzbekistan. This will allow the creation of a single state policy in this sphere. The Ministry of Energy has been assigned with new tasks, which among others include:
- developing suggestions for investment projects to increase energy efficiency, including by organizing and conducting scientific research;
- applying economic sanctions for inefficient use of fuel resources by legal entities, irrespective of their ownership.
A new department within the Ministry of Energy has been created to cover energy efficiency and energy saving in sectors of the economy and social sphere. There will be a new liability for failing to perform instructions given by responsible governmental bodies in the sphere of energy, as well as for failing to conduct mandatory energy inspections and assessments. The Ministry of Energy shall make suggestions regarding changes and additions to the Code of the Republic of Uzbekistan on Administrative Liability within two months.
As a result of the reforms, it is predicted that the share of renewable energy sources in total energy generation will reach at least 25% by 2030. Currently, this indicator is at 10% and mainly attributable to hydro-electric power plants. Specifically, the following shares are expected: wind energy production – 1,600 MW (5%), solar energy – 4,300 MW (8.8%), and hydro-energy – 1,500 MW (11.2%).
Here is a list of some actions included in the Complex program:
|1.||Improvement in the process of conducting mandatory energy inspections.|
|2.||Implementation of energy-service contracts into common practice.|
|3.||Implementation of a system of differentiated tariffs (block tariffs) for electricity, natural gas and hot water.|
|4.||Development and approval of state standards in the field of renewable energy.|
|5.||Introduction of smart lighting level control systems into the existing street and main lighting systems.|
|6.||Production of electrical energy from waste heat, flare and associated gas in oil and gas fields.|
|7.||Implementation of modern and transparent methods of competitive selection of potential investors in the framework of the implementation of renewable energy projects on the basis of PPP, including amendments to the law on PPP in terms of determining a potential private investor, including through auction bidding to lower the starting price, as well as approving the rules for conducting auction trading and the creation of a special trading system for such trading by the end of 2019.|
|8.||Submission to the Cabinet of Ministers by November 2019 of proposals for improving the tariff policy in the field of renewable energy.|
|9.||Implementation of the procedure for determining the potential locations of solar photovoltaic stations, taking into account the benefits of distributed generation.|
|10.||Until mid-2020, implementation of measures on the feasibility of providing (certain) SEZ (special economic zones) and SIZ (small industrial zones) with local energy through renewable energy.|
|11.||Development and approval of a standard form of an agreement on the purchase of energy produced using renewable energy sources based on national legislation.|
|12.||Research to assess the potential of bioenergy resources and creating practical development measures.|
Earlier this year, the Law "On the use of renewable energy sources" was adopted. A review of this law is available here.
Dentons is the world's first polycentric global law firm. A top 20 firm on the Acritas 2015 Global Elite Brand Index, the Firm is committed to challenging the status quo in delivering consistent and uncompromising quality and value in new and inventive ways. Driven to provide clients a competitive edge, and connected to the communities where its clients want to do business, Dentons knows that understanding local cultures is crucial to successfully completing a deal, resolving a dispute or solving a business challenge. Now the world's largest law firm, Dentons' global team builds agile, tailored solutions to meet the local, national and global needs of private and public clients of any size in more than 125 locations serving 50-plus countries. www.dentons.com.
The content of this article is intended to provide a general guide to the subject matter. Specialist advice should be sought about your specific circumstances.