The CASA-1000 project, which begins the process of integrating the energy markets in Central and South Asia, is moving along with updated feasilbility studies from an independent consulting firm.
CASA-1000 constitutes the first phase of a regional project known as Central Asia-South Asia Regional Electricity Market (CASAREM), and is meant to facilitate electricity trade between these two regions. The World Bank commissioned an independent consulting firm, SNC-Lavalin of Canada, to update its previous feasibility studies to assess the project’s soundness and viability. Although the studies suggest that CASA-1000 would profit both the exporting and importing states, Kyrgyz and Tajik civil societies remain unconvinced that the public would be able to benefit from the profits.
Once completed, CASA-1000 would transmit about 1300 MW electricity from the Kyrgyzstan and Tajikistan to Afghanistan and Pakistan. The exported electricity is meant to come from summer surplus remaining after Kyrgyzstan and Tajikistan meet their domestic demands. According to the initial agreements, while Afghanistan will receive only 300 MW of the exported electricity since it may already have sufficient energy to meet a large part of its internal demand, Pakistan will receive 1000 MW. The latter has also expressed interest in increasing these imports over time. The starting date for the project is 2012, and experts estimate that CASA-1000 can be completed within five years.
The latest feasibility study concluded that the CASA-1000 project is both pragmatic and “economically viable.” Accordingly, while Afghanistan and Pakistan demonstrate a great need for electricity imports, Kyrgyzstan and Tajikistan’s summer surplus electricity could meet these needs without impacting their own winter energy deficits. Furthermore, the study suggests that making transmission investments in support of the electricity trade seems justified by the differences in the cost of electricity between the importing and exporting countries. Given that the study evaluated the technical and economic viability of CASA-1000 in positive terms, the countries participating in the project may begin to seek funding for it.
Experts estimate that the total project would cost US$953mn. Country-wise, the construction of CASA-1000 facilities on Kyrgyzstan’s territory would cost US$196mn; on Tajikistan’s US$251mn; on Afghanistan’s land US$309mn; and US$197mn on Pakistan’s territory. Both international financing institutions (IFIs) and bilateral financiers may bid for the project. To date, the IFIs that expressed interest in investing in CASA-1000 include the World Bank, the Asian Development Bank, and the Islamic Development Bank.
While experts argue that CASA-1000 could greatly benefit both Kyrgyzstan and Tajikistan, civil society organizations (CSOs) in both countries are expressing numerous concerns regarding this project. The revenues generated by the export of the summer surpluses could help develop means to minimize the winter deficits, and reduce the costs of supplying winter energy domestically. Despite these pronouncements, however, Kyrgyz and Tajik civil CSOs remain highly concerned that the construction of CASA-1000 would diminish public access to electricity by reducing the amounts available for domestic use and increase its price. Other issues about which the CSOs have expressed concern to the World Bank are the governance and revenue management framework, environmental and social safeguards, project feasibility, and governments’capacity to mitigate the problems. Accordingly, the CSOs continue calling for public consultations, independent studies, and political, environmental and social assessments of the project risks related to CASA-1000.