World Bank Approves REMIT Program to Establish Central Asia’s First Regional Electricity Market

Despite strong potential, electricity trade currently accounts for only around 3% of total demand, while variable renewable energy contributes just 4% of power generation.

The World Bank’s Board of Executive Directors has approved the Regional Electricity Market Interconnectivity and Trade (REMIT) Program, a landmark initiative aimed at transforming energy cooperation in Central Asia through the creation of the region’s first-ever regional electricity market.

The multi-phase program will be implemented over a 10-year period across three phases and is designed to significantly boost cross-border electricity connectivity, increase power trade, expand transmission capacity, and enable large-scale integration of renewable energy across Central Asia.

First Phase Secures $143.2 Million in Financing

Under the program’s first phase, the Kyrgyz Republic, Tajikistan and Uzbekistan, along with the Central Asian Countries’ Coordinating Dispatch Center (CDC) Energia, will receive $143.2 million in grants and concessional financing.

This includes $140 million from the World Bank’s International Development Association (IDA) and $3.2 million in grants from the Central Asia Water and Energy Program (CAWEP). The funding will support national and regional activities required to lay the foundation for a regional electricity market.

Rising Energy Demand Driving Urgency

Electricity demand in Central Asia is rising rapidly and is projected to triple by 2050 under a business-as-usual scenario. Economic growth, population increases, industrial expansion and urbanisation are intensifying the need for affordable, reliable and sustainable energy across the region.

Despite strong potential, electricity trade currently accounts for only around 3% of total demand, while variable renewable energy contributes just 4% of power generation. This is occurring in a region endowed with abundant and complementary clean energy resources that remain largely underutilised.

Unlocking Complementary Energy Resources

The REMIT Program aims to harness Central Asia’s diverse and complementary energy assets, including hydropower in the Kyrgyz Republic and Tajikistan, thermal generation in Kazakhstan, Turkmenistan and Uzbekistan, and rapidly growing solar and wind potential across the region.

By strengthening cross-border cooperation and market integration, the program seeks to optimise energy production, reduce system inefficiencies and improve resilience.

Ambitious Targets for Trade, Transmission and Clean Energy

Over the next decade, REMIT aims to:

• Increase electricity trade to at least 15,000 GWh annually, enough to meet the yearly needs of millions of people;

• More than triple regional transmission capacity to 16 GW; and

• Enable up to 9 GW of clean energy resources.

Improved regional integration is expected to reduce outages, enhance system reliability and lower energy costs for households and businesses.

Economic and Employment Benefits

“The REMIT Program supports Central Asian countries’ ambition to deepen energy cooperation and create a regional electricity market,” said Najy Benhassine, World Bank Regional Director for Central Asia.

“This will enable more efficient use of energy resources, including cross-border deployment of clean energy, improve access to reliable and affordable electricity, support jobs, and by 2050 could generate up to $15 billion in economic benefits for the region,” he said.

The program has total indicative financing of $1.018 billion across all three phases. Investments will support market design and operations, regional transmission upgrades, digital grid systems and strengthened regional institutions. The program is also expected to create construction-related employment and highly skilled jobs required to operate the regional electricity market.

Leveraging Private Investment and Renewables

According to Charles Cormier, World Bank Regional Infrastructure Director for Europe and Central Asia, the strengthened grid and regional market will unlock private investment and accelerate renewable energy deployment.

“The first phase alone is expected to enable around 900 MW of new clean energy capacity, leveraging approximately $700 million in private investment,” he said.

Governance and Implementation

CDC Energia, which is mandated to coordinate power exchanges among Central Asian countries, will implement the market and institutional components of the program. National transmission companies will be responsible for grid investments.

Oversight will be provided by a Regional Steering Committee, comprising energy ministries and implementing agencies, to ensure coordinated implementation across participating countries.

Future phases of the REMIT Program will build on the initial foundation by expanding the market platform, reinforcing and digitalising transmission networks, and strengthening regional institutions to support long-term energy integration.