Kazakhstan and Russia Sign New Electricity Agreement

Kazakhstan’s Ministry of Energy has submitted a draft law to the Majilis for ratification, outlining a new agreement with Russia regulating the parallel operation of their energy systems.

The updated agreement revises the rules for electricity cooperation between the two countries and establishes mechanisms for compensating supply deviations, Orda.kz reports.

Kazakhstan’s Minister of Energy, Almasadam Satkaliyev, explained that Kazakhstan’s power grid operates in parallel with Russia’s.

However, in recent years, Kazakhstan’s Unified Energy System (UES) has faced shortages in regulating capacity due to unexpected power plant shutdowns and emergency repairs. This has led to significant deviations from the agreed limits of electricity flow at the Russian border — sometimes reaching 1,500 MW, far beyond the acceptable range of ±150 MW.

Therefore, Russia requested revising the 2009 agreement in 2021. A joint working group was formed, and in 2023, they finalized a new deal that establishes updated compensation rules:

• Deviations within ±150 MW remain free of charge
• If the flow exceeds 150 MW, Kazakhstan must pay for the excess electricity and its transmission through Russia’s power grid, operated by Rosseti and System Operator UES

Russia initially proposed a profitability rate increase of up to 15% for excess flows, but Kazakhstan negotiated it down to 2.5% (originally, Russia suggested a range of 5–15%).

The agreement also clarified balance flow regulations and set new terms for financial settlements between Kazakhstan Electricity Grid Operating Company (KEGOC) and Russia’s Inter RAO.

The negotiation lasted two years, with Kazakhstan’s Ministry of Energy, KEGOC, and SFC for RES Support, ensuring that national interests were protected by minimizing Russia’s demands.

The agreement received approval from the Atameken National Chamber of Entrepreneurs and other accredited organizations.

Satkaliyev assured us that the deal would not impact consumers' electricity tariffs.

Electricity transfer happens only during shortages. During peak hours, Kazakhstan has to buy expensive electricity from neighboring countries. Last year, we partially sourced some from Uzbekistan and Russia, where the average price is 48 tenge per kilowatt-hour. This agreement won’t lead to price increases because it covers only emergency purchases — without it, we would have to impose restrictions on domestic consumers.  said Satkaliyev.

Following these discussions, the Majilis deputies ratified the agreement.

Original Author: Ilya Astakhov