Kazakhstan, a resource-rich country in Central Asia, has adopted ambitious plans for a clean energy transition, supported by large renewable energy potentials and a long-term decarbonization agenda. In the recent years, Kazakhstan has also recorded some progress in its implementation of these plans. However, this transition continues to face a number of challenges rooted in its history and its economy. It is the largest oil producer in Central Asia, and its domestic electricity system remains heavily dependent on fossil fuels. The central question is whether Kazakhstan can move toward cleaner energy as it continues to depend on the oil and gas revenues and institutions that have shaped its economy for decades.

Solar power plant in Almaty Region (Photo: Nikolai Bulykin / Wikimedia Commons [CC BY-SA 4.0])

Geographical Spread of Kazakhstan’s Energy System

Kazakhstan’s geographical and historical background helps explain the structural realities of its current energy transition. Kazakhstan is the world’s largest landlocked country and the ninth-largest country by area, covering about 2.7 million square kilometers. Its population is just over 20 million, giving it one of the world’s lowest population densities, at about 7.4 to 7.6 people per square kilometer.

Additionally, Kazakhstan’s population is concentrated in a limited number of urban centers. Settlements, production sites, and economic activity are spread across vast distances. Nearly 60% of Kazakhstan’s residents live in urban areas concentrated in a few major centers such as Almaty, Astana and Shymkent.

Kazakhstan’s size and low population density make it costly to build and maintain integrated national transport and infrastructure networks. In practice, this means roads, railways, transmission lines, and other basic systems must connect a very large territory with a relatively small and unevenly distributed population. These same conditions also help explain why the country’s energy and industrial activity developed separately in different regions rather than in one concentrated area.

Almaty and Astana are major economic centers, while oil-producing Western Kazakhstan is a separate economic center. At the same time, more than 90% of proven coal reserves are concentrated in the north and central parts of Kazakhstan, while  copper, lead, zinc and other metal based industries are concentrated in Karaganda, East Kazakhstan, and Pavlodar.

Pre-Soviet history

The country’s energy profile is also the result of a long historical legacy. Kazakhstan had a long and layered history shaped by its vast territory, geography, and shifting political control. Geographically, much of present-day Kazakhstan makes up part of the Eurasian steppe, a vast grassland belt stretching across Europe and Asia. Historically, many communities practiced nomadic pastoralism (Note 1). By the 5th–4th centuries BCE, trade across the territory of present-day Kazakhstan already made up part of the Silk Road (Note 2). Routes through southern Kazakhstan connected steppe communities and towns, stimulating commerce and cultural exchange.

In the centuries that followed, political control over the steppe changed several times. From the 13th to 15th century, much of the region had been incorporated into the Mongol Empire and its successors. After the weakening of the Mongol rule due to plague, internal succession struggles, and outside attacks, the Kazakh Khanate (Note 3) became a new political power in the late 15th century. However, struggles over succession weakened the Khanate’s authority. From the 18th century onward, this decline, combined with the gradual expansion of the Russian Empire brought more of the Kazakh steppe under tsarist rule, a process that intensified in the 19th century.

From that point onward, Kazakhstan’s vast territory, uneven settlement, and dispersed sources base were reorganized within a new political and economic system that would shape its later energy structure.

The Soviet legacy in Kazakhstan’s energy system

In 1920, the Soviet government created the Kirgiz Autonomous Republic within Soviet Russia, renamed it the Kazakh A.S.S.R. in 1925, and in 1936 transformed it into the Kazakh Soviet Socialist Republic, a full union republic of the Soviet Union. Politically, this meant Kazakhstan was governed within a one-party Soviet system in which decisions on administration, agriculture, industry, and resource use were made through central planning rather than local autonomy.

In the early Soviet decades, this central planning system reshaped both society and the economy. Soviet rule forced the settlement of nomadic Kazakhs, and expanded collectivized agriculture. At the same time, the Soviet government began to systematically develop Kazakhstan’s mineral resources as part of its industrialization process.

Lithuanian political prisoners working at a mine in Kazakhstan, undated (Photo: Europeana / Wikimedia Commons [CC BY 4.0])

From 1920 onward the Soviet government expanded production of coal, copper, and iron, intensified the extraction of gold and lead. It built new fossil fuel (Note 4) industrial centers in places such as Karaganda in central Kazakhstan, Balkhash and Zhezkazgan in the copper-producing belt, and Oskemen in the east, where other important metals were mined and processed. This pattern of development also reinforced the geographic spread of Kazakhstan’s energy and industrial economy, leaving key resources and industrial centers located in different parts of the country.

Large-scale exploitation of coal in Ekibastuz in the Pavlodar Region accelerated after a rail connection reached the area in 1953, and by the 1970s it had become the third largest coal-mining center in the Soviet Union. Kazakhstan’s energy exploitation thus became a major source of fuel, minerals, and industrial output for the wider Soviet economy.

This Soviet-led development left Kazakhstan with an economy built around fossil fuels, mineral extraction, and large industrial networks. Coal remained central to electricity generation, while oil and gas remained important to fuel production. Industrial hubs grew around resource deposits, and infrastructure was designed to serve a Soviet-wide production system.

Independence and the start of the clean energy transition

Kazakhstan gained its independence with the collapse and breakup of the Soviet Union in 1991. In the 1990s, the country remained heavily dependent on the Soviet-era economic structure it had inherited. Under President Nursultan Nazarbayev, the immediate priority was not renewable energy but economic stabilization and the preservation of state revenue through hydrocarbons.

In the early 1990s, his government opened the oil sector to foreign investment, and in 1993 it signed an agreement with US oil major Chevron to develop the Tengiz oil field, one of the first major post-Soviet energy deals. It was estimated in 2001 that the oil sector had attracted more than 80% of cumulative foreign direct investment since 1993.

Oil field in Zhanaozen (Photo: ekipaj / Shutterstock.com)

However, Kazakhstan’s energy system had begun to age. A 2024 International Energy Agency (IEA) study reported that the average age of coal-fired power plants in Kazakhstan was 55 years. Meanwhile, global recognition of the threat of climate change, and policies aimed at reducing the use of fossil fuels, gave Kazakhstan pause to reconsider its reliance on coal and oil.

Faced with these problems, the government began to explore renewable alternatives. It was noted that Kazakhstan has substantial renewable energy potential that could support a broader transition toward cleaner energy. Considering Kazakhstan’s geography, it is estimated that the country has renewable potential of around 920 billion kilowatt-hours from wind, 3,000 sun hours, and 62 billion kilowatt-hours from hydropower annually.

Government explorations led to a series of national policy commitments. The path to clean energy through policy began with the 2009 law “On Supporting the Use of Renewable Energy Sources”. It became the basic legal framework for supporting renewable electricity projects.

In 2012, the government adopted the Kazakhstan-2050 Strategy (Note 5). This set an aspirational goal of generating half of all electricity from alternative and renewable sources by 2050. In 2013, the Concept for Transition of the Republic of Kazakhstan to a Green Economy translated that vision into interim targets of 3% renewables by 2020, 10% by 2030, and 50% by 2050. Apart from energy, it deals with issues associated with water, agriculture, air pollution, and waste management.

Further steps toward clean energy

A second phase of the renewable energy transition began in 2019, when Kassym-Jomart Tokayev took office after President Nursultan Nazarbayev resigned. Under Kazakhstan’s succession rules, Tokayev, who was then chairman of the Senate, became acting president and later won the June 2019 presidential election. Tokayev expanded Nazarbayev’s renewable energy framework.

Parliament of Kazakhstan (Photo: Mazhilis of the Parliament of the Republic of Kazakhstan / Wikimedia Commons [CC BY 4.0])

In 2021, Kazakhstan added a Doctrine of Carbon Neutrality that pledged net-zero emissions by 2060. He also increased the target for renewable energy share by 2030 from 10% to 15%. Separately, under its Nationally Determined Contribution (NDC) submitted through the Paris Agreement process, Kazakhstan confirmed a target of reducing greenhouse gas emissions by 15% by 2030 compared with 1990 levels. Kazakhstan uses 1990 as its baseline year, a reference point commonly used in earlier UN climate frameworks, though the Paris Agreement does not require all countries to use the same baseline.

Policy developments have also been seen at a more granular level. With assistance from the United Nations Development Programme (UNDP), for example, the government introduced a site-specific renewable energy auction mechanism in 2019, under which investors bid for projects at pre-assessed locations rather than searching for sites themselves, reducing uncertainty and preparation costs. Projects are also taking place through state-backed financing channels, with the state-linked Damu Entrepreneurship Development Fund reportedly having supported 140 green projects by 2024. Kazakhstan also adopted amendments in 2024 to its 2009 law to strengthen the legal environment for new projects.

Some progress appear to have been made. According to the government, over the first nine months of 2024, Kazakhstan increased electricity generation from renewables by 18% compared with the same period of 2023, with renewables accounting for 6.7% of the national energy mix. Those figures show movement, but they also show the scale of the gap. Reaching the target of 15% by 2030 will require a step up in pace in its transition.

International Engagements for Renewable Energy in Kazakhstan

Kazakhstan is also building and expanding partnerships with entities outside of Kazakhstan. Among these entities, foreign corporations working on renewable energy projects are stepping up investments. German firms Goldbeck Solar GmbH and Solarnet Investment GmbH, for example, are working with the government to implement large-scale solar projects in the Karagandy Region.

Meeting between the chair of Samruk-Kazyna and the ADB president (Photo: Masato Kanda / Flickr [CC BY 4.0])

Regional organizations are also taking part. The European Bank for Reconstruction and Development (EBRD) supported a site-specific auction for a 150-megawatt wind plant in 2022, while the Asian Development Bank (ADB) began a pre-feasibility study for a hydropower project in 2024, meaning an initial assessment of whether the project was practical before it moved further toward auction.

Kazakhstan is also trying to place its transition within a wider regional framework. In April 2026, Kazakhstan’s Senate approved a trilateral agreement with Azerbaijan and Uzbekistan to expand cooperation in renewable energy. The agreement is intended to support the production, transmission, and trade of green energy, including green hydrogen and green ammonia, while improving cross-border electricity transmission. The arrangement is expected to strengthen a Central Asia clean energy corridor and could connect to the Black Sea submarine cable project, which may allow exports of green electricity to European markets.

Challenges in Renewable Energy Transition for Kazakhstan

As we have seen so far, Kazakhstan has planned and begun implementing a shift from fossil fuels to renewable energy. But the shift is still in its infancy. As of 2025, fossil fuels account for about 85% of electricity generation in Kazakhstan. Coal alone supplies more than 70% of Kazakhstan’s electricity. Clearly, the energy sector of the country is still structurally tied to conventional fuels. According to the Extractive Industries Transparency Initiative (EITI), oil and gas accounted for 14.1% of Kazakhstan’s GDP in 2021, while the extractive sector accounted for nearly 43% of total tax payments. Government reporting in 2025 also showed that raw-material exports still made up 63.5% of total exports in 2024. That means fossil fuels are not only an energy source but also a major source of export earnings for Kazakhstan.

There are a number of structural reasons why the transition remains slow. For example, Kazakhstan’s dependence on hydrocarbons was institutionalized in the 1990s through long-term production-sharing agreements (PSA) with foreign oil companies and consortia, including Chevron, ExxonMobil, Eni, Shell, TotalEnergies, CNPC, Inpex, and Lukoil. Those agreements gave the state access to investment and international support during their post-independence fiscal crisis, but they also locked Kazakhstan into oil rent dependence for decades.

The structural problem is reinforced by governance and pricing issues. Kazakhstan merged its energy and environmental agencies into a single Ministry of Energy in 2014, centralizing hydrocarbons and renewables under one authority, before later regrouping environmental responsibilities with resource extraction in a new ministry.

Underground coal mine in Pavlodar (Photo: primeminister.kz / Wikimedia Commons [CC BY 4.0])

Core renewable targets remain nonbinding. The 2009 renewable energy law did not require fixed yearly action, the 2013 green economy concept set ambitious but unenforceable goals, and the 2021 carbon neutrality doctrine outlined targets without legal penalties.

Moreover, the merger of agencies and revenue structure shaped the political economy of the energy sector, concentrating wealth and influence in a narrow group of politically connected elites and state-linked companies. In that framework, renewable energy did not emerge as an independent alternative, but was drawn into the same state-led system.

By 2012, that pattern had become clearer with the creation of Samruk Green Energy, a subsidiary of Samruk Energy under Samruk-Kazyna, Kazakhstan’s sovereign wealth fund. This wealth fund manages major national companies and strategic assets across sectors such as energy, transport, and industry. That institutional design matters because decisions on tariffs, grid access, and investment remain tied to actors whose broader interests are still aligned with fossil-fuel dominance.

Kazakhstan’s export infrastructure also reinforces its dependence on fossil fuels. Kazakhstan’s oil export position still shapes the country’s short-term incentives. The IEA reports that the country exports roughly 80% of its oil, mostly to Asia and Europe. Kazakhstan plans to supply 2.5 million tons of oil to Germany in 2026, up from more than 1 million tons in 2023 and 2.1 million tons in 2025. This shows that oil exports remain a current strategic priority and one of the key factors for the country’s energy and economic sector. That creates a dual-track reality: Kazakhstan is building green projects while simultaneously deepening oil relationships with major external markets.

The IEA notes that Kazakhstan’s energy market still favors fossil fuels. In Kazakhstan, coal still appears cheaper than cleaner alternatives, which makes it harder for renewable power to compete in the electricity market. Because energy prices are politically sensitive, the IEA says major price reforms are difficult.

Astana skyline (Photo: Susan / Flickr [CC BY-NC-SA 2.0])

A way forward for Kazakhstan’s Renewable Energy Transition

The possibility of a more substantive transition lies in whether Kazakhstan can use a coming institutional opening to change the terms of its energy model. Several of the production-sharing agreements (PSAs) signed in the 1990s, for its biggest oil and gas projects are moving toward expiry. One such opening may come when the state revisits the long-term oilfield contracts governing the oilfields of Tengiz, Karachaganak, and Kashagan. Reuters reported in 2025 that President Tokayev had instructed the government to seek better terms in those agreements. These contracts were seen as central to the fossil-fuel model that shaped Kazakhstan’s economy and politics after independence. If they are renegotiated, the state may have more room to reduce dependence on that older model.

The IEA points to a broader set of steps giving consideration to energy prices. It calls on Kazakhstan to reduce its reliance on coal, add electricity sources that can respond more quickly when demand rises or supply falls, diversify export routes so the country is less dependent on a small number of channels, and adjust energy prices gradually while protecting vulnerable households through compensation and subsidies.

Taken together, the sources suggest that Kazakhstan’s path forward is not blocked by a lack of plans or by a lack of renewable resource potential. It is blocked by a political economy and historical legacy that still rewards fossil continuity. A substantive transition would therefore require not only more wind, solar, and cross-border projects, but also more transparent institutions, more enforceable rules, and a willingness to loosen the structures that made hydrocarbons the core of state power in the first place.

Note 1: Nomadism refers to a way of life in which people move seasonally with their livestock, such as horses and sheep, instead of living in settled farming communities.

Note 2: The Silk Road refers to the network of long-distance trade routes linking China with Central Asia, the Middle East and parts of Europe, along which goods, people and cultures moved across Eurasia.

Note 3: The Kazakh Khanate was a nomadic political entity formed on the Central Asian steppe in the late 15th century, generally dated to 1465–1466 and associated with the leadership of Kerei Khan and Janibek Khan. It emerged after Kazakh groups separated from the Uzbek Khanate and later came to control much of the steppe east of the Caspian Sea and north of the Aral Sea. It is widely seen as an important historical foundation for Kazakh statehood and national identity.

Note 4: Fossil fuels are natural, non-renewable energy sources—mainly coal, oil and natural gas. When burned, they release carbon dioxide and other greenhouse gases, making them a primary cause of climate change and air pollution.

Note 5: The Kazakhstan-2050 Strategy, announced by President Nursultan Nazarbayev in December 2012, is a long-term development plan aimed at placing Kazakhstan among the world’s 30 most developed countries by 2050. It focuses on economic growth, stronger state institutions, better living standards, and the development of a “wellbeing society” through modernization, diversification, and public-private partnerships.

Writer: Mohammad Istiaq Jawad

Graphics: Sara Matsumoto

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