ASTANA — In an interview with The Astana Times, Marco Arcelli, the Chief Executive Officer of ACWA Power addressed Kazakhstan’s potential in renewable energy and water shortages on the sidelines of the Kazakhstan Global Investment Roundtable (KGIR) on Nov. 17.
The Chief Executive Officer of ACWA Power Marco Arcelli spoke to The Astana Times correspondent Aida Haidar. Arcelli said that with the imminent implementation of the Carbon Border Adjustment Mechanism in Europe, Kazakhstan must rapidly decarbonize its economy to facilitate exports to the region, as imports will be taxed based on their originating carbon content. Photo credit: The Astana Times/Aida Dosbergenova.
In March, an agreement was signed between the Kazakh Ministry of Energy, Samruk Kazyna Sovereign Wealth Fund, and ACWA Power, the world’s largest private desalination company, to construct a one-gigawatt wind farm in the Zhetisu Region. Construction is set to commence in 2025.
Renewable Energy Potential in Kazakhsta
Arcelli expressed optimism about Kazakhstan’s significant potential in the renewable energy sector. Beyond traditional sources like solar and wind, he highlighted the importance of embracing emerging technologies such as green hydrogen and ammonia.
According to Arcelli, diversification is not only crucial for Kazakhstan’s decarbonization goals but is also driven by global trends, particularly the European Union’s (EU) Carbon Border Adjustment Mechanism (CBAM).
“There are very ambitious targets set by the country’s leadership, but particularly because Europe is introducing the CBAM that will tax imports based on the carbon content of where they come from. If Kazakhstan wants to export to Europe, it will need to decarbonize the economy very quickly,” Arcelli said.
The mechanism, set to tax carbon-intensive imports, propels countries worldwide to streamline their decarbonization efforts. ACWA Power, having successfully implemented renewable projects in 14 countries, including Saud Arabia, Uzbekistan, South Africa, Morocco, and Indonesia, aims to leverage its experience to enhance cost efficiency in Kazakhstan’s renewable energy endeavors.
Highlighting ACWA Power’s global experience, Arcelli noted the company’s track record in achieving the lowest prices in solar photovoltaic, concentrated renewable power, and green hydrogen positions them as industry leaders. He emphasized the significance of being a first mover, making projects fully bankable and offering the most competitive prices.
Two years ago, Air Products, ACWA Power, and NEOM inked a $5 billion deal to establish a cutting-edge production facility fueled entirely by renewable energy. As the world’s largest green hydrogen initiative, set to produce a staggering 650 tons of hydrogen per day, it promises to revolutionize global transportation by supplying an environmentally friendly alternative. Moreover, this initiative is projected to save an impressive three million tons of CO2 annually, marking a signficant stride towards sustainable and eco-friendly energy solutions on a global scale.
ACWA Power’s Expertise in Water Desalination
Aside from renewable energy, Arcelli underscored the company’s position as the largest private desalinator, operating in Saudi Arabia, the United Arab Emirates, Bahrain, and Oman. With a capacity of 7.6 million cubic meters per day, ACWA Power addresses the critical need for water in arid regions.
“We control a capacity of 7.6 million cubic meters per day, which might not give you a clear idea of how big that is. But that is equivalent to the needs of about 20% to 30% of all four countries mentioned above,” Arcelli said.
The company uses innovative solutions from around the world, collaborating with Japan for membranes, European technology, and Saudi expertise, particularly from the Water Desalination and Reuse Center within King Abdullah University of Science and Technology in Saudi Arabia.
He emphasized the company’s commitment to reducing chemial usage, brine discharge, and environmental impact. ACWA Power’s desalination expertise is now sought by countries beyond the Gulf region, including Mexico, Morocco, Egypt, Indonesia, China, Azerbaijan, and Kazakhstan.
Challenges and Solutions in Renewable Projects in Kazakhstan
Arcelli acknowledged the challenges when initiating large-scale renewable projects in remote areas, such as logistical and weather-related obstacles. However, according to him, Kazakhstan can be a big player in exporting both to the EU and China.
“Consider that the EU aims to import ten million tons of green hydrogen and produce ten million tons by 2030 locally. To produce ten million tonnes of green hydrogen requires land covered by solar panels and wind turbines equivalent to the size of Belgium. So you need a lot of land. Countries like Saudi Arabia and Kazakhstan have a lot of land where you can install the necessary equipment,” Arcelli said.
He emphasized that this will also impact how local industies, such as mining, steel, fertilizer, and petrochemical refining, source their energy. The country can effectively mitigate carbon emissions by opting for green hydrogen instead of traditional hydrogen produced from natural gas or other conventional fuels. This strategic shift can potentially enhance the competitiveness of Kazakhstan’s exports in the European market.
Arcelli said there are challenges that still need addressing, such as connecting power generation, desalination, and green hydrogen production to spur economic growth.
“We can propose an overall solution that brings the power generation, the desalination, the green hydrogen so that it can become like a catalyst for the development of the population and of industries, both for local consumption, but also for exports,” he said.
When asked about potential workforce shortages, Arcelli drew from ACWA Power’s experience in Saudi Arabia, highlighting the initial phase of foreign talent attraction, followed by the rapid deveopment of local expertise. The company has established its own Energy and Water Academy in two countries (Saudi Arabia and Uzbekistan), graduating hundreds annually to support the industry’s growing demand. The company is keen on replicating this successful model in Kazakhstan, contributing to skill development and the local economy.
