Uzbekistan, Afghanistan sign 10-year electricity supply contract
The supply of electricity in the first year would be 4.2 billion kWh, and starting from the third year, this figure will reach 6 billion kWh annually, Deputy Energy Minister Sherzod Khodjaev said at a press conference.
Khodjaev noted that despite the “take-or-pay” contract formula, the Uzbek side made concessions and agreed to sign the contract on “soft terms”.
With the “take-or-pay” contract, one party of the contract either takes the product from the other or pays the other party a penalty.
“Given the difficult situation in Afghanistan, we agreed to have a more flexible supply schedule not to force them to pay fines,” the deputy minister said, adding that the contract is not seasonal, but designed for a year-round supply of electricity.
Uzbekistan has been supplying electricity to Afghanistan regularly since 2002. Over the years, the supply volume has increased from 62 million kWh to almost 2.6 billion kWh in 2019, according to experts.
Before the signing of the contract, supply contracts between the two sides were conducted on an annual basis.