Decarbonization Potential of Uzbekistan’s Economy

Amidst the global shift towards a low-carbon economy, Uzbekistan recognizes the need for active measures to reduce greenhouse gas emissions and enhance energy efficiency.
For Uzbekistan, decarbonizing the economy is a strategically crucial task that will encompass all key sectors, from energy and industry to transportation and agriculture.
Uzbekistan’s Commitments under the Paris Agreement
Under the Paris Climate Agreement, at the 26th session of the Conference of the Parties to the UN Framework Convention on Climate Change in Glasgow (COP26), Uzbekistan committed to reducing greenhouse gas emissions per unit of GDP by 35% by 2030 compared to 2010 levels (previously, this reduction target was set at 10%). To achieve this goal, the development of a National Low-Carbon Development Strategy is planned.
As President of Uzbekistan Shavkat Mirziyoyev stated at the COP28 Summit held in December 2023, “The global transition to a low-carbon economy must be fair, transparent, and inclusive. The shift to a ‘green’ economy and achieving carbon neutrality are top strategic priorities of the New Uzbekistan.”
Decarbonizing Uzbekistan’s economy represents a vital step toward sustainable development and combating climate change. Achieving the set goals requires a comprehensive approach.
Energy Market Liberalization as a Key Step toward Decarbonization of Uzbekistan’s Economy
The main sources of emissions across Uzbekistan’s economy are the energy sector (76%), agriculture (18%), industry (5%), and waste (1%).
At the same time, it is estimated that by 2030, the country’s electricity demand will reach 120 billion kWh.
In this regard, one of Uzbekistan’s primary steps to accelerate decarbonization efforts has been the liberalization of the energy market. The energy market liberalization initiative is tied to the Presidential Decree on the "Strategy for the Development of New Uzbekistan for 2022–2026," which aims to end the monopoly on electricity supply and introduce market mechanisms.
Additionally, there is a goal to create a unified electricity trading platform and launch it by the end of 2024. By 2026, a free wholesale market is expected to be implemented, based on supply and demand for electricity.
This will contribute to energy savings and create a favorable environment for the private sector to invest in renewable energy sources.
Achieving the goal of increasing the share of renewable energy to 25% of total generation by 2026 will allow Uzbekistan to save natural gas and prevent a CO2 emissions increase of 37.4 million tons. Overall, Uzbekistan aims to raise the share of “green” energy to 40% by 2030.
Additionally, implementing measures to reduce CO2 emissions in Uzbekistan’s economy will help achieve the Sustainable Development Goals and support “green” growth. This is a key priority for the government of Uzbekistan and international financial institutions, such as the World Bank and the IMF.
Decarbonization Prospects
As mentioned above, the energy sector is the primary source of greenhouse gas emissions. In this regard, large-scale transformations are underway in this area aimed, first, at modernizing existing gas-powered thermal plants to increase efficiency and reduce energy intensity; and second, at developing and widely implementing renewable energy systems.
In the coming years, the country has set several specific goals and objectives aimed at sustainable development and reducing greenhouse gas emissions, in particular:
 exploring the feasibility of implementing carbon capture and storage (CCS) projects in industry and energy;
 introducing advanced waste management practices and utilizing biogas from agricultural waste;
 implementing Uzbekistan’s decarbonization strategy for transportation, which includes transitioning to electric vehicles, developing rail transportation, and improving public transit;
 establishing a favorable regulatory framework to support “green” projects, including economic incentives, subsidies, and tax benefits for investors in renewable energy and low-carbon technologies;
 actively developing public-private partnerships in the construction and modernization of environmentally sustainable infrastructure;
 strengthening the professional training system for specialists in renewable energy, environmental monitoring, and decarbonization project management.
Conclusion
In the long term, Uzbekistan plans not only to maintain the pace of decarbonization but also to develop an advanced regulatory and incentive system for low-carbon projects, including the integration of modern approaches and digital technologies for emissions monitoring.
In the near future, the region will face many challenges, but with a comprehensive approach and clearly defined strategic objectives, Uzbekistan can serve as a model for other Central Asian countries in sustainable development and decarbonization.
Ultimately, the successful implementation of all planned measures will lead to an improved quality of life for the population, an enhanced environmental situation, and long-term economic stability for the entire region.
Public Relations Sector
Center for Economic Research and Reforms