Kyrgyzstan Considers Increased Compensation for Toktogul Hydroelectric Impact

A Kyrgyz parliamentary committee has approved the first reading of a bill to increase compensation for damages resulting from the construction of the Toktogul Hydroelectric Power Plant and its reservoir. The proposed amendments seek to raise annual payments from 70 million to 358 million soms. While the government supports the principle of indexing the payments, the Cabinet of Ministers has recommended a lower increase to 119 million soms.

Minister of Energy Altynbek Rysbekov stated that the government’s proposal reflects current inflation levels. The compensation amount was last adjusted in 2016 – when it was raised from 56 million to 70 million soms – and the proposed 119 million soms accounts for inflation since 2017. Rysbekov added that should this sum be approved, the government will implement a mechanism for automatic annual indexing of the compensation.

The minister warned lawmakers of the financial implications for the energy sector. He noted that the state has no access to external funding to cover these additional expenses, meaning the costs will be reflected in electricity tariffs.

During the legislative session, debates centered on the distribution of these funds. Member of Parliament Ulugbek Ormonov criticized the management of the special fund directorate currently responsible for payments to residents in the Toktogul impact zone. Ormonov referenced reports from the Accounts Chamber indicating that auditors frequently uncover the misappropriation of funds, which has led to multiple criminal investigations.

The discussion highlighted concerns that a significant portion of the compensation is currently used to pay the salaries of the fund’s administrative staff. Legislators have proposed liquidating the directorate – transferring the funds directly to the regional development fund – to ensure the money reaches its intended recipients without administrative overhead.