The European Bank for Reconstruction and Development (EBRD) has announced that it will be financing the development of a 100 MW solar project in the Zhambyl region of southern Kazakhstan.

The project is being executed by M-KAT Green LLP which is a joint venture between Access Infra Central Asia and Total Eren.

The project, which will have an estimated total construction cost of $132.2 million, is expected to help the country in reducing dependence on electricity imports from other regions, most of which are from coal-fired plants. Transmission losses are also expected to reduce through this project.

The EBRD will be providing a senior loan of up to $58.5 million and the Asian Development Bank (ADB) will be co-financing the project.

The EBRD is a multilateral developmental investment bank which was set up in 1991 to support businesses in more than 30 countries from Europe and Central Asia after the communist collapse in eastern Europe.

According to Mercom’s Solar Funding and M&A Tracker, in June 2018, the EBRD provided $32 million to Risen Energy, a Chinese solar manufacturer, for the construction of a 40 MW solar project in the Karaganda region, Kazakhstan. Also, in May 2018, Risen Energy signed a mandate letter with the EBRD for financing the construction of a 63 MW greenfield solar project in Kazakhstan. The financial details for this transaction were undisclosed.

“The [M-KAT] Project is expected to have a demonstration effect with the potential to pave the way for an increase in volume of foreign investment in the renewables sector of Kazakhstan. Furthermore, the project will demonstrate the viability of project finance structures that are still scarce in the Kazakh market,” the bank noted.

In addition to this, EBRD is currently looking to finance a project by loaning up to $52.7 million to SES Saran LLP, a special purpose vehicle (SPV) owned by German company Solarnet GmbH.

Kazakhstan aims to generate 50 percent of its electricity from renewable and alternative sources of energy as per President Nazarbayev’s 2050 strategy. This is a part of the country’s goal to transform its energy ecosystem into a more sustainable one.