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Eni is a leader among global oil companies in the implementation of renewable energy projects in Kazakhstan. In May last year, Mr. Alex Stillavato was appointed to the position of Renewables Business Manager of Eni branch in Kazakhstan. He is also the Managing Director of Arm Wind LLP, which is the main contractor for these projects and is a subsidiary of Eni. Today, Eni’s portfolio in Kazakhstan includes three RES projects with a total capacity of 146 MW.

Mr. Stillavato, could you please share Eni’s experience with the Badamsha Wind Farm project? 

Phase 1 of the Badamsha Wind Farm occupies a special place in Eni’s renewables business, representing our first large-scale investment in wind and the first step of an extensive renewable presence in the Republic of Kazakhstan. This project is a tangible implementation of the Memorandum of Understanding signed between the RoK Ministry of Energy and Eni in June 2017, launching a new era for renewable energy development for Eni in the Country. It is important to note that the project would not be as successful without the active engagement and support of the Local Authorities.  
On 24 March 2020, the Wind Farm produced its first billable electricity to the Financial Settlement Center (FSC). Overall, the execution phase from Balance of Plant (BoP) Contract Award to the Commercial Operation Date took 17 months, completing just ahead of the initial schedule. 
Lifting of the turbine components started in September 2019 and all Wind Turbine Generators were installed by February 2020. By 5 June 2020, all thirteen were fully operational. Badamsha Wind Farm will provide Aktobe Oblast with an annual power generation of 195.6 GWh, with an overall CO2 saving of 172,000 tons per year. 

What are the lessons learned from Badamsha Phase 1 that you intend to implement for Phase 2 of the Badamsha project? 

In general terms, Badamsha 1 represents a very successful case study for future RES project implementation. However, as for any large-scale project, a few areas were identified that if further enhanced would make Phase 2 implementation even more progressive and effective. 

Kazakhstan’s Renewables’ (RES) sector is relatively young and we faced a steep learning curve.  In particular, it took us longer than initially expected to obtain construction permits for Badamsha 1, as we had to familiarize with the process: we now know how to be more efficient in future projects. On the other hand, we managed to substantially offset the consequent slight delay to the work start schedule by recovery actions within the BoP contract, which also taught us important efficiency lessons.

In addition, there was an impact of adverse weather conditions on the erection of Wind Turbine Generators (WTGs). Strong winds, frost and foggy conditions all created difficulties during the project execution. For Phase 2, the WTG erection phase is planned to be executed in the summer/early autumn to avoid the negative impact of the winter season.


Arm Wind LLP is currently implementing the Solar Power Plant project in Shaulder, which was awarded to the company as the result of the Ministry of energy auction held in November 2019. Could you please explain how the auction process was held? How did you manage to reach the offer of 12.49 tenge per kwh? What are the main features of this project? 

Eni has carried out a steady expansion in the RoK RES market.  Today, Eni’s portfolio in Kazakhstan includes three RES projects with a total capacity of 146 MW. The awarding of the Shaulder Solar Power Plant was, to a great extent, the result of the successful implementation of the “Auction with ready documentation” mechanism. This mechanism is the outcome of the extensive work performed by the RoK Ministry of Energy (MoE), KOREM, FSC, United Nations Development Program (UNDP) and RES developers. The new legislative framework was created for a new type of auction and the MoE and UNDP made a significant effort to conduct explanatory sessions with all involved parties. The project was then selected and the preliminary auction documentation was developed allowing investors to analyze the project profitability and investment risks long before the publication of the RES auction schedule. 

In August 2019, the documentation for the project “Construction of 50MW Shaulder Solar Power Plant in Otyrar District, Turkestan Oblast” prepared by UNDP in line with the MoE request was published. Following the publication, detailed analysis of the project’s efficiency and risks was carried out, several economic scenarios of the project with possible proposed prices were evaluated and the trading strategy was defined. As a result, we were well prepared by the auction date. 

We believe that the auction mechanism with documentation is more efficient for both the Country and Developers, optimizing the location of RES Projects in the RoK in terms of energy needs and the grid capability. 
Currently, we target to startthe project execution in Quarter 4 of this year. The Solar Power Plant will produce around 90 GWh per year and approximately 2,700 GWh in 30 years with an overall CO2 saving of 50, 000 tons per year. 

RES industry implies a significant increase in energy costs and has a very long payback period. In addition, severe weather conditions in Kazakhstan often force developers to use more expensive project solutions. Could you please share your experience in dealing with such complexities? 

Consideration of weather conditions is vital for the development of an efficient project execution schedule. During the winter months it is advisable to develop and finalize the detailed design of the project, while construction activities, including concrete pouring, foundation works and WTG installation, should be executed in the milder season to avoid as far as possible a weather standby allowance to pay for idle days.  
Additional specific winterization measures, such as the installation of heat blowers, shelters and canopies, are standard for any work that is performed during the winter season and must be built into capital expenditure budgets. 

Currently, the Government pays great attention to the local content in projects implemented in Kazakhstan. What is the level of local content in works and services rendered within your projects, particularly Shaulder project? 

Our Company’s philosophy is to involve local communities in the projects we realize globally. It is essential for us to ensure that the territory has the maximum benefit and value from our Projects and we continually make our best efforts to address this matter with our general contractors. We instruct our contractors to work with Local Employment Centers ensuring the constant flow of local candidates’ resumes. Our primary goal is to find specialists locally and widen the search borders only if required due to a shortage of specific competences in the local employment market.  

Badamsha 1 retained 85% local personnel during the construction phase and targets retaining 100% during operations.  This will also apply to the Badamsha 2 and Shaulder projects, and we hope to maintain a constant rate of project execution in the future to allow us to keep jobs for local experts, thereby contributing to the development of high level sectoral skills in the relevant District/Oblast. Badamsha 1 and Badamsha 2 are perfect examples of our approach towards local jobs preservation, where work on the Badamsha 2 site commenced straight after completion of Phase 1. 

In the medium to long run, the real increase of local content in the RES industry should be closely linked not only to the works and services rendered during the projects implementation, but also to the progressive growth of the Country’s manufacturing capability. The possible expansion of the renewable market in terms of assigned capacities and provision of long-term investment stability in the sector will inevitably stimulate the domestic production of locally manufactured goods. This measure possibly complemented with ad hoc local content incentives, especially at the initial stages, should create a virtuous cycle, ensuring in the long run a real sustainable renewable market with sustainable qualified jobs.  

Kazakhstan has set an ambitious target for the development of renewable energy sources up to 50% by 2050. How would you describe the overall growth of res industry in Kazakstan compared to other countries? How do you think the Government could reach the goal of 2050? 

Kazakhstan has significant potential in terms of wind and solar energy and we believe that the implementation of these large-scale projects would benefit the current energy mix and contribute to the progressive decarbonization of the power generation system. The Country’s steppe geography is perfect for wind energy solutions and at least half of the territory has a wind speed suitable for energy generation. Southern territories of the country with high solar irradiation are also appropriate for solar power generation. 

As mentioned earlier, RoK RES market is relatively young. Therefore, all stakeholders (both private and public) have to jointly address the existing technical, social and economic barriers based on the experience of RES industry leaders.  Fortunately, today, the majority of these barriers have been reflected in the legislative initiatives of the RoK Government.

In general, the regulatory framework in the field of renewable energy needs to focus on making the unique economic and technical features of the RES industry as efficient as possible in order to consolidate the interests of both the state and the developers. 

We firmly believe that Kazakhstan has all the potential to become a leader in the RES industry of Central Asia meeting and exceeding the goals set by the Government.