ENERGY SITUATION WORSENS IN TAJIKISTAN

C O N F I D E N T I A L DUSHANBE 000157

SIPDIS

STATE DEPT FOR SCA/CEN

E.O. 12958: DECL: 02/10/2019
TAGS: ENRG PGOV ECON PREL UZ TI
SUBJECT: ENERGY SITUATION WORSENS IN TAJIKISTAN

REF: A. DUSHANBE 21

B. DUSHANBE 121

C. DUSHANBE 154

Classified By: Ambassador Tracey A. Jacobson, reasons 1.4 (b) and (d)


1. (C) Summary: Sanat Rahimov, the new chair of the national
electricity company Barqi Tojik, dismissed as ridiculous the
notion that Tajikistan either could or should hold back water
in the spring to replenish its hydroelectric reservoirs. He
said Tajikistan must "live within its energy means" and not
rely on its neighbors. He had made no efforts to contact his
Uzbek counterparts since he was appointed 15 days ago. He
said the Nurek Hydroelectric Station should have enough
capacity to generate electricity through March 20, while
World Bank experts say there is only enough water to last
through February 20. Meanwhile, the energy situation is
becoming more precarious in Tajikistan. Most parts of the
capital receive energy 15 hours per day; areas outside of the
capital receive only a few hours, if any. Consumption at the
Talco aluminum plant has declined by 20%, though this likely
owes more to the sagging world aluminum market than to
altruistic concerns about limiting usage. End Summary.


2. (SBU) Econoff met with Sanat Rahimov on February 5. He
began by explaining how the Central Asian energy grid, built
during the Soviet era, was explicitly designed to balance
agricultural and industrial needs as well as regionally
varying seasonal surpluses and deficits by distributing
electricity throughout the region. He boasted the system was
agile enough to avoid the kinds of blackouts that had plagued
the United States in years past (evidently referring to the
major east coast power outage of 2003 and earlier west coast
blackouts in the late 1990s). Yet the one constant refrain
during the meeting was that Tajikistan must now live within
its energy means and not rely at all on its neighbors. "We
generate 17 billion kilowatt-hours per year. We must live on
17 billion per year. That's all there is to it."

Tajikistan Will NOT Hold Back Water in Spring


3. (C) Rahimov dismissed as ridiculous the notion, voiced by
several people in the Tajik government, including Foreign
Minister Zarifi, that Tajikistan might have to hold on to
water in the spring and summer to replenish its reservoirs.
"Whoever said that, and I don't know who it is, clearly has
no understanding of power." He said if Tajikistan held back
water it would not be able to generate power or feed its
agriculture. On the contrary, he said, it was in
Tajikistan's interests to let the water flow to the fullest
extent possible. He allowed that those saying otherwise
might be "playing political games."


4. (SBU) Rahimov noted, however, that the situation at the
Kairakum Hydroelectric Station, on the Syr Darya River,
differs from Nurek. While the Vakhsh River feeding Nurek
receives a relatively steady flow of water during the summer
season from glacial melt, the Syr Darya is fed by snowmelt
and volumes decline considerably over the course of the
summer. Because of the energy crisis, the Kairakum Station
is currently in power generation mode, letting water flow out
of the reservoir across the turbines, when it should be in
agriculture mode, accumulating water for later use during the
growing season. As a result, the river leading out of the
reservoir could conceivably run dry later in the year. He
said that Tajik authorities have informed their Uzbek
counterparts of this concern.
Qcounterparts of this concern.

Unrealistic Expectations of Power Use


5. (C) Rahimov directly contradicted nearly unanimous
reporting that the Nurek Hydroelectric Station, which
supplies over three-quarters of Tajikistan's electricity,
will run out of generation capacity in mid-February. Rahimov
said Nurek had sufficient water in its reservoir to last
until March 20 before reaching the "dead point," where the
water level is too low to power the turbines. World Bank
experts, however, put that moment exactly a month earlier.
When asked how he could square this difference, Rahimov said
the issue needed to be thought of in terms of consumption,
not production. "We must work tirelessly, 24 hours a day, to
change our consumption habits." He drew an analogy: an
Englishman, asked how his country had such perfect lawns,
responded that it must be carefully seeded, fertilized and
watered. "Do this for three hundred years, and you will have
a perfect lawn." He said that Tajikistan must adopt the same
slow and steady approach to adjusting its consumption. When
asked how this long-ra
nging strategy was going to help in winter 2009, Rahimov
vaguely acknowledged that there might have to be further
rationing.


6. (SBU) According to Sodyk Khaitov, an energy specialist
with the World Bank, Nurek can conceivably continue to
generate power at water levels three or four meters below the
"dead point." Because of silt buildup along the reservoir's
floor, however, the dam would be running a significant risk
of a "hydraulic shock" caused by a foreign object entering
the turbines. Khaitov added that power rationing had been
having a significant effect on consumption. Without
rationing Nurek was consuming as much as 60 cm a day from its
reservoir; it now draws off between 20 and 30 cm. The
country as a whole was using 62 GWh of electricity before the
rationing, while it now uses closer to 30 GWh.

Ignores Uzbeks


7. (C) Unlike other officials in recent days, Rahimov refused
to criticize Uzbekistan for Tajikistan's precarious energy
situation, even though he expressed bafflement about Uzbek
intentions. He declared, almost boastingly, that he had been
in office for 15 days and had not once bothered trying to
contact his Uzbek counterparts. When asked to speculate why
Tashkent would refuse to transmit Turkmen energy to
Tajikistan, Rahimov said he had no idea (refs A and B). He
did say, however, that the excuse occasionally given by
Uzbekistan, that the line between Turkmenistan and Tajikistan
needed repairs, was patently ridiculous. The repairs the
Uzbeks described, he said, "are a matter of a few hours.
They've given some kind of excuse that they are having
logistical difficulties getting repairs done. We've offered
to send specialists, but they ignore us."

Talco Cuts Consumption


8. (SBU) According to some reports, as much as 50% of
Tajikistan's domestically produced power is consumed by the
Talco aluminum plant. The company announced in December that
it would reduce its consumption by 10% in response to the
energy crisis. President Rahmon then ordered Talco to cut
its consumption by 35% in January, according to a press
report. Khaitov said Talco had in fact cut its usage by
about 20%, from 20 Gigawatts to 16 GW; he said he expected
Talco to further reduce its consumption by another Gigawatt
or two, but that the process must be gradual in order not to
damage the equipment. He acknowledged, though, that Talco's
decision - whether voluntary or forced - to decrease
consumption is much more likely a result of the sagging world
aluminum market than concerns about domestic power
availability. Talco's revenue was expected to fall 50% in
2009, according to World Bank country director Chiara Bronchi.

Expect Rate Increases


9. (SBU) Both the World Bank and Rahimov agreed that Tajiks
pay too little for electricity. Tajiks now spend
approximately 1.9 cents per kilowatt-hour, after a 25% rate
hike on residential consumers in January. Drawing a
comparison we have heard several times, Rahimov asked how
Tajiks, who average three cellular phones per family, are
comfortable spending three cents a minute on calls but are
allowed to spend only a cent and a half (prior to the
increase) on electricity. Revisiting his central theme,
Rahimov said that Tajiks must be led to understand the value
of electricity, and that meant price increases. Adducing
somewhat inaccurate statistics, he said that Turkey pays 9
cents per kWh, which he said was the lowest in the world, and
Qcents per kWh, which he said was the lowest in the world, and
most countries pay much higher. (Note: Turkey's residential
rate is in fact closer to 12 cents per kWh, but residents of
many countries pay much lower. End note.)

World Bank Nervous about Roghun Power Politics


10. (C) Bronchi of the World Bank voiced some concern that
power politics were taking an ominous turn in Central Asia
(ref C). She said that the Bank staff in Tashkent had told
her that "normal, uneducated" people in Uzbekistan are saying
that if Tajikistan goes ahead with the Roghun hydroelectric
project it could lead to war. While she did not think armed
conflict was imminent, she did not take such information
lightly. She and Khaitov said as far as they could tell the
Uzbek concerns about Roghun were entirely unfounded. Khaitov
said according to preliminary data, the Vakhsh River at
Roghun was responsible for only 13% of the total flow of the
Amu Darya River leading into Uzbekistan - meaning that, even
if the Tajiks could completely cut off the flow of the Vakhsh
(which they can't),it would only minimally affect downstream
water levels. The theoretical ability to stop the Vakhsh
flow already existed further downstream at Nurek, making the
Uzbek position even harder to understand. At most, Uzbekistan
would see a very small decrease in water flow during the
summers as the Roghun reservoir filled over the course of 15
or 18 years. (Note: other studies quoted to us by the World
Bank indicate the Vakhsh makes up 30% of the flow of the Amu
Darya. It is likely the measurements are from different
points along the Vakhsh. End note.)


11. (C) Nevertheless, the Uzbek position on Roghun had
Bronchi nervous. The World Bank is underwriting three
feasibility studies on Roghun - technical, environmental, and
social - and any hostilities that erupted over the project
could conceivably implicate the Bank. She wanted to be very
certain that the Bank's role was thus very transparent and
above board. She said the studies would be put out to bid
later this month and hopefully contracted within 6 months
(see ref C).


12. (C) In Bronchi's view, the world economic crisis had
altered the playing field in Central Asia. Russia, which has
seen its economic might rapidly diminish, was looking to
shore up its sphere of influence in the region. Speaking
about the recent Russian announcement of aid for Kyrgyzstan,
apparently in exchange for the closure of the U.S.-run Manas
Airbase, she said that the Russians might try to do something
similar - such as threatening their way into Roghun. (Note:
She was not deterred by the fact that the United States has
few assets in Tajikistan, making the playing field rather
different here. End note.)


13. (C) Kazakhstan has been significantly reduced in stature,
as it has seen its banks nationalized and its currency
devalued. In contrast, Uzbekistan finds itself stronger than
ever. "Swimming" in foreign currency reserves and relatively
shielded from world financial markets, it is in a position to
dictate terms to its weakened neighbors. From this
perspective, Bronchi thought Uzbekistan's refusal to transmit
Turkmen energy to Tajikistan was little more than a
provocation designed to put Tajikistan on notice about Roghun.


14. (C) Comment. Though the Tajiks can sound like a broken
record, never tiring of expounding on their need to increase
power generation, they have a point. The lack of power is a
major hindrance to economic growth as well as a barrier to
improving the quality of life for the population. In the
short term, Tajikistan remains fully dependent on Uzbekistan
for power imports. Given Uzbekistan's increasing lack of
desire to cooperate, Tajikistan understandably is focused in
the medium-term on developing additional power production
capacity and reducing dependence on unreliable imports.


15. (C) Comment, continued. While Rahimov appeared genuine
in his calls for energy independence, like the country's
political leaders he did not broach obvious but difficult
steps such as further reducing Talco's consumption, smoothing
out power production more evenly over the year, or extending
power rationing to Dushanbe to allow more even national
distribution. He seemed unwilling to acknowledge how soon
Nurek could reach its limits; even if his prediction somehow
came true, the power situation would remain precarious for
months.


16. (C) Comment, continued. Bronchi is not the only one who
Q16. (C) Comment, continued. Bronchi is not the only one who
is becoming concerned that rhetoric over water and power
issues is ratcheting up and exacerbating the existing
resentments among the local populations. Regardless, there
is genuine bafflement here - as in much of the region - about
just what Uzbekistan is after, and how they hope to achieve
it with their current tactics. End comment.
JACOBSON