On January 14, President of the Republic of Uzbekistan Shavkat Mirziyoyev reviewed a presentation on improving energy efficiency and introducing market-based mechanisms in electricity supply. The proposed initiatives focus on rational use of resources, infrastructure modernization, and the creation of a competitive energy market.
Energy efficiency as a strategic priority
Uzbekistan is among the countries with high levels of energy consumption. In particular, buildings account for nearly 50 percent of final energy use nationwide, while energy consumption per square meter is several times higher than in European countries.
To address this issue systematically, a dedicated Energy Efficiency Agency was established last year. The agency has been tasked with reducing overall energy consumption in the economy by at least 20 percent by 2030, and by 15 percent in government institutions and social facilities.
The presentation outlined the agency’s plans for 2026. It was noted that a large share of buildings in Uzbekistan were constructed in the 1960s and 1970s, resulting in persistently high energy losses. Therefore, large-scale measures are planned to transform social facilities and residential buildings into energy-efficient properties. In the current year, 150 billion soums will be allocated for subsidies and compensation to support these efforts.
Special emphasis was placed on expanding the involvement of international financial institutions and private sector investments to improve the energy efficiency of nearly 30,000 social facilities nationwide. Under this year’s investment program, 770 social facilities will be modernized in line with energy efficiency standards, with 264 million US dollars expected to be attracted from international financial institutions.
The development of income-generating mechanisms through energy savings was also discussed, including the formation and expansion of the energy service company (ESCO) market. Plans were presented to widely apply digital technologies and artificial intelligence in energy audits, building design, and energy modeling.
In the industrial sector, solar panels are planned to be installed at 142 textile enterprises this year, which is expected to save 722 million kilowatt-hours of electricity and reduce company expenditures by 693 billion soums. In addition, 300 pumping units are scheduled to be upgraded within the drinking water supply system.
Existing challenges in the centralized heat supply system were also addressed. Due to the deterioration of boiler houses and heating networks, energy losses remain high. In this context, plans for the current year include modernizing heat supply systems, transitioning them to closed-loop systems, installing 400 individual heating substations, and upgrading at least 100 kilometers of heating networks.
Responsible authorities were instructed to develop effective energy efficiency standards and regulations to be applied in construction, renovation, and reconstruction projects.
Development of the wholesale electricity market
The presentation also covered progress in introducing competitive market mechanisms in the electricity sector. The transfer of low-voltage electricity networks to the private sector will begin in Samarkand region and later expand to Andijan, Jizzakh, Namangan, Syrdarya, Tashkent region, and the city of Tashkent.
These measures are aimed at attracting investment for network upgrades and significantly reducing electricity losses.
Information was provided on the formation of the wholesale electricity market. To date, a list of large consumers using more than 10 million kilowatt-hours of electricity per year has been compiled. For these consumers, it is proposed to introduce direct contracts for purchasing electricity on the wholesale market at hourly, market-based prices.
Work is currently underway to establish regulators in the energy and utilities sectors. Based on international experience, a proposal was put forward to create a single, unified regulator covering both areas.
President Shavkat Mirziyoyev approved the presented proposals, emphasizing the importance of increasing energy efficiency, ensuring rational resource use, and fostering a competitive environment in the energy market. Relevant instructions were issued to responsible officials.
Law enforcement and prosecution authorities were tasked with ensuring strict compliance with legal requirements in the discussed sectors, guaranteeing the inevitability of accountability, and working closely with local governments to ensure the full implementation of planned measures.