Far East: Central Asia’s Emerging Role in Alleviating Europe’s Energy Crisis and Fostering Clean Energy Transition

Europe is now grappling with an energy crisis in the wake of Russia’s invasion of Ukraine. Natural gas shortages and rising energy prices as a result of sanctions on Russian energy exports have caused widespread concern and political fallouts, prompting European countries to search for new energy suppliers. This is particularly evident when it comes to Germany, which has historically been the largest European importer of Russian gas with over half of the total share. In mid-September, German Chancellor Olaf Scholz embarked on a three-day summit in Astana, Kazakhstan, with the goal of bolstering economic ties between Central Asia and Europe. This high-profile visit marked a shift in Germany and Europe’s approach to Central Asia, which, with its abundant energy resources, presents a potential solution to the European energy crisis. Central Asia has the potential to be a key player in mitigating the ongoing energy crisis, with prospects in clean energy transitions under the Europe-Central Asia partnership.

Natural Gas, Oil, and Energy Security

Central Asia, particularly Kazakhstan, Turkmenistan, and Uzbekistan, is known for its large reserves of oil and natural gas, positioning the region as a potential solution to Europe’s energy needs. Significant oil exports to Europe via the Caspian Pipeline Consortium (CPC), which links Kazakhstan to European markets, have helped alleviate Europe's dependence on Russian energy exports. However, connecting these supplies to Europe is a major challenge, where pipeline systems play a key role. A project in this regard is the Trans-Caspian Pipeline (TCP), which aims to transport Turkmen gas across the Caspian Sea to Azerbaijan, connecting to the Southern Gas Corridor and ultimately delivering it to Europe. While the region is well-connected to China and Russia via existing pipelines, expanding westward would bolster Europe’s energy diversification efforts. Yet, geopolitical tensions, particularly with Russia, have slowed the development of direct routes to Europe. 

With Europe seeking alternatives to Russian-controlled infrastructure, expanding pipelines through Azerbaijan and Turkey presents an opportunity to secure oil flows while bypassing Russian territory. Meanwhile, Turkmenistan, the region’s largest untapped gas supplier, is increasingly seeking international cooperation to expand its energy reach. Transit routes from Turkmenistan to Turkey and into Europe would significantly lessen Europe’s reliance on Russian gas. The Caspian Sea Convention, signed in 2018, has also improved prospects for regional collaboration, making the TCP more viable, though environmental and political obstacles persist.

To support these efforts, Europe could invest in Kazakhstan's energy infrastructure, helping to develop alternative export routes through the Caucasus and the Caspian Sea. Such investments would not only enhance Europe’s energy security but also provide a stable and reliable partner in Central Asia.

Clean Energy Transition

While Central Asia’s fossil fuel resources are critical to Europe’s immediate energy needs, the long-term potential for collaboration lies in the clean energy sector. Both Europe and Central Asia have committed to ambitious climate goals, and cooperation in renewable energy development and technology transfer could play a pivotal role in achieving these targets. Kazakhstan, for instance, has set a goal of generating 50% of its electricity from renewable sources by 2050. The country’s vast wind and solar potential, particularly in its sparsely populated regions, offer immense opportunities for renewable energy development. Meanwhile, Uzbekistan has embarked on an ambitious program to develop solar and wind energy, aiming to increase the share of renewables in its energy mix to 25% by 2030.

For Europe, investing in Central Asia’s renewable energy sector presents a twofold opportunity: securing access to clean energy and fostering technology transfer that can benefit both regions. European companies specializing in wind, solar, and energy storage technologies can play a key role in helping Central Asian countries transition to renewable energy sources. In turn, Central Asia’s clean energy potential can contribute to Europe’s efforts to decarbonize its energy supply and reduce its dependence on fossil fuels. Joint research and development initiatives, supported by European and Central Asian governments, can accelerate innovation in areas such as energy storage, grid integration, and hydrogen production. The EU’s European Green Deal, which aims to make Europe climate-neutral by 2050, provides a framework for supporting green investments in Central Asia, further strengthening ties between the two regions. European companies can benefit from Central Asia’s strategic location, abundant natural resources, and growing consumer markets, while Central Asia can leverage European investment to modernize its industries and integrate into global value chains.

Chancellor Scholz’s visit to Central Asia highlights the growing importance of the region in addressing Europe’s energy crisis and fostering sustainable development. By developing oil and gas projects, collaborating on clean energy transitions, and promoting technology transfer, Europe and Central Asia have the potential to build a mutually beneficial partnership that supports both regions’ economic and environmental goals. As Europe seeks to diversify its energy sources and accelerate its green transition, Central Asia stands poised to play a key role in shaping the future of Europe’s energy landscape.