1

2

3

4

5

16.0%

7.0%

1.3%

0.4%0.5% 0.4% 1.0%

1.5%

1.3%

0.8%1.7%

Co

st

of

Eq

uit

y

Best-

in-C

las

s C

ou

ntr

y

Po

we

r M

ark

et

Ris

k

Perm

its R

isk

So

cia

l A

cce

pta

nce

Ris

k

Deve

lop

er

Ris

k

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d /

Tra

nsm

iss

ion

Ris

k

Co

un

terp

art

y R

isk

Fin

an

cia

l S

ecto

r

Ris

k

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liti

cal

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k

Cu

rre

ncy

/Ma

cro

.

Ris

k

Co

st

of

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uit

y

Kazak

hsta

n B

AU

Cost of Equity (USD)

6

Risk Category

Policy Derisking

Instruments

Financial Derisking

Instruments

Power Market

Risk

• Update transparent, long-term national renewable energy strategy

• Establish and run IPP bidding process, with bankable PPA

• Establish a renewable energy office in the regulator

NA

Permits Risk • Streamlined process for RE permits (dedicated one-stop shop)

• Contract enforcement and recourse mechanisms

NA

Social Acceptance

Risk

• Awareness-raising campaigns NA

Developer Risk • Technology R&D

• Support for industry associations

NA

Grid/Transmission

Risk

• Strengthen KEGOC’s grid management capacity

• Transparent, up-to-date grid code

• Policy support for long-term national transmission/grid road-map

• Take-or-pay clause in PPA

Counterparty Risk • Reform and maintain creditworthy Financial Settlement Centre structure

• Government guarantee for PPA payments

• Public loans to IPPs

Financial Sector Risk • Fostering financial sector reform towards green infrastructure investment

• Strengthening financial sector’s familiarity with renewable energy and project finance

• Public loans to IPPs

Political Risk NA NA

Currency/

Macroeconomic Risk

NA • Partial indexing of PPA tariff to hard currencies

7

16.0%

0.3% 0.1% 0.1% 0.0%0.6%

0.9% 0.1% 0.0%0.9%

13.2%

Co

st

of

Eq

uit

y

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hsta

n B

AU

Po

we

r M

ark

et

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k

Perm

its R

isk

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cia

l A

cce

pta

nce

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k

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lop

er

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k

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d /

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ion

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k

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un

terp

art

y R

isk

Fin

an

cia

l S

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r

Ris

k

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liti

cal

Ris

k

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/Ma

cro

.

Ris

k

Kazak

hsta

n

Po

st-

Deri

skin

g

Co

st

of

Eq

uit

y

Cost of Equity (USD)

-2.8%

8

5.7

9.2

7.1

Baseline(unsubsidised)

Wind InvestmentBAU

Wind InvestmentPost-Derisking

LC

OE

(U

SD

cen

ts/k

Wh

)

LEVELISED COST OF ELECTRICITY (LCOE)

9

Report’s 2021 (5 year) wind investment targets: 1 GW

If USD 275.6 million

• USD 1.6 billion in private sector investment in wind

• USD 804.7 million savings due to derisking (lower wind costs)

• USD 310.6 million savings due to avoided fossil fuel subsidies

• Wind energy generation costs decrease from USD 9.2

cents/kWh to USD 7.1 cents/kWh

• Emission reductions of 56.3 million tCO2e over 20 years

10

11

2.9

High Risk Investment Environment

Solar PV/Battery(off-grid)

Financing Cost (Equity)Financing Cost (Debt)

Investment Cost/Depreciation

Diesel Generator(off-grid)

Diesel Generator(off-grid)

Maintenance CapEx

Low Risk Investment Environment

15.2

4.3

11.7

39.3

30.1

2.839.6

Solar PV/Battery(off-grid)

Operating Cost(incl. fuel cost)

2.95.3

3.62.1

2.915.2

50.1

72.3

27.9

12.0

45.2

2.05.0

3.61.6

1.0

+83%

+14%

PR

E-TA

X L

CO

E (U

SD C

ENTS

/kW

h)

12

REDUCE

RISK

TRANSFER

RISK

COMPENSATE

FOR RISK

Policy

Derisking

Financial

Derisking

Financial

Incentives

Examples:

Clear regulations

Examples:

Loan guarantees

Examples:

Tax incentives

Streamlined customs Grants

DIVERSIFY

RISK

Aggregation

(By Private

Sector)

Public loans

13

14

15

GLOBAL INDUSTRY WORKING GROUP

(Composed of key industry actors)

OUTPUTS:• Strategic work programme• Regional, national, technical

sub-committees

STANDARDISEDTOOL KITS

OUTPUTS:• Develop and disseminate best

practice, standardised:• Template contracts• Installation and O&M• Due diligence metrics• Transaction structures

IN-COUNTRY DEMONSTRATION AND SCALE-UP

(In partnership with other development actors)

OUTPUTS (project funds for 4 countries):• Technical support for pilot first-

of-a-kind transactions • Technical support for

policy/market architecture

CLIMATE AGGREGATION PLATFORM

16

Aggregating

Entity

Special

Purpose

Vehicle (SPV)

S S S S

S S S S

S S S S

Investor Investor

Investor

Investor Investor

End Users Cons. Credit

Info Companies

Solar Co.

Legal Counsel

Investment

Bank

Development

Bank (credit

enhancement)

Installers

Manufacturers

Credit Rating

Agencies

Institutional

Investors

Securities

Regulator

Financial

Regulator

(Tax Investors)

STAKEHOLDERSDEAL STEPS BARRIERS & PUBLIC MEASURES

Limited data on credit

worthiness of end-users

Support to develop national

credit information markets

Fragmented approach

to contracts, installation

and O&M

Standardized contracts,

installation and O&M,

performance metrics

Lack of experience;

high costs for deal

structuring

Piloting first-of-a-kind

deals; online platforms for

project ID; national industry

associations

Lack of experience;

inefficient due diligence;

unconducive regulations

Mock filings; common due

diligence metrics;

securities law reforms

Low demand due to lack

of familiarity; lack of

liquidity; inefficient due

diligence; unconducive

regulations

Engage and raise

awareness of investors;

common due diligence

17

18