Energy Security in Context of Tariff Increase and Shortage in Central Asia

Abstract

This thesis explores the connection between energy tariff increases, continuous electricity shortages, and energy security issues in Central Asia. Despite abundant natural resources, Central Asian states continue to enter a cyclical environment with seasonal energy shortages, aggravated by an ageing infrastructure, population explosion, and fragmentation in regional governance. It is this latter, not national-level economic tariff reforms adopted by policymakers as devices for cost-recovery to attract international investment and ensure fiscal sustainability, that have not been sufficient to overcome structural causes of energy insecurity. Drawing upon a multi-layering theoretical architecture comprising the Water-Energy Nexus, as well as the Zero-Sum and Non-Zero-Sum Game Theory and the political economy perspective, this paper illustrates the nexus of the fragmented Central Asian Energy Ring after the dissolution of the Soviet Union that has created zero-sum competition for water and energy. Through comparative case studies of Kazakhstan, Kyrgyzstan, Tajikistan, Turkmenistan, and Uzbekistan, this analysis demonstrates that unilateral policies of imposing winter hydropower generation by upstream states and prioritizing fossil fuel export downstream states create shortages and lead to the development of social strain. Methodologically, the study has qualitative, interpretive components (document analysis, thematic review, and critical discourse analysis of policy documents, statistical data and expert literature). These conclusions suggest that a rise in tariffs generates revenue, but frequently does not translate to an infrastructure upgrade that deepens household vulnerability over time without narrowing the system-wide deficits. On the basis of this evidence, the thesis argues that transforming sustainable energy security in Central Asia requires us to shift from individual-level national reforms; instead, we need a collaborative regional governance framework which is based on the principle of benefit-sharing. It recommends an arrangement for a permanent Regional Energy Coordination Council and a multilateral agreement on benefits for the water-energy nexus to police, orchestrate investment and distribute costs and benefits evenly through the water-energy nexus. Such policy recommendations aim to redefine the region’s zero-sum system to a positive-sum system, allowing the region to pursue energy resilience, social equity and regional stability in the long run.