Gas and electricity price liberalization program to be adopted by September 

Until September of this year, a program for the liberalization of prices for gas and electricity will be presented in Uzbekistan. This was reported to Gazeta.uz by the First Deputy Minister of Energy Azim Akhmedkhodjayev.

According to him, within the framework of this program, it is planned to liberalize energy prices and introduce social consumption norms.

“In order to improve the efficiency of energy-consuming enterprises, as well as for long-term planning, we want to reduce electricity costs and divide them into different tariffs, because currently one gas and electricity tariff is set for each enterprise. We want to separate them and approach each subject, each business and social stratum in Uzbekistan separately,” Azim Akhmedkhodjayev said.

He noted that one of the main goals of the government is to remove obstacles to the efficient operation and growth of the electric power industry.

Azim Akhmedkhodjayev added that the Ministry of Energy, together with international financial institutions and other organizations, is developing a new regulatory framework for the entire industry, which will become the basis for future reforms.

“We are preparing the foundations for the transition to a competitive electricity market in Uzbekistan. Now we are working on a program according to which we will attract foreign companies and foreign experience in the field of electricity transmission to the regions. We want to attract good management companies that can demonstrate a new approach to generating electricity and delivering it to the end consumer,” he said.

To do this, an independent regulator will be created that will regulate market tariffs and relations between energy producers and consumers. According to Akhmedkhodjayev, the ministry is studying the experience of Azerbaijan in this regard, after its testing, the regulator will be able to work independently.

It should be recalled that the last time gas and electricity tariffs were raised in August 2019.

Last year, it was planned to increase the basic tariffs for residents by 10% and switch to differentiated tariffs from July 1, but this did not happen. It is envisaged that tariff differentiation will force consumers to save and will reduce subsidies from the budget for the relatively wealthy and most energy-consuming segment of the population.

According to economists, an open and competitive energy market must be created to fundamentally address power and gas outages. In the state program-2022, many tasks were set for energy reform in the same direction, but the implementation of most of them was delayed.

President Shavkat Mirziyoyev, in his address to the parliament at the end of 2022, said that the transition to a free energy market was the right way, but emphasized that it would be gradual.

In February 2023, the Deputy Chairman of the Central Bank said that liberalization could begin in May, which is included in the inflation forecast.

In March of this year, the Ministry of Economy and Finance announced that electricity and gas tariffs for household consumers in Uzbekistan would not increase in 2023.