EBRD And Green Climate Fund Back €64 Million District Heating Modernisation Project In Bishkek

The European Bank for Reconstruction and Development (EBRD) is supporting efforts to improve environmental sustainability and air quality in Bishkek, the capital of the Kyrgyz Republic, through a financing package of up to €64 million for the city’s two district heating companies, Bishkekteploset (BTS) and Bishkekteploenergo (BTE).

The initiative marks the first district heating project financed by the EBRD in the country and is aimed at modernising heating infrastructure while reducing reliance on fossil fuels.As part of the overall package, the EBRD is providing loans of up to €27.3 million to the two utilities. This includes a sovereign loan of up to €17.2 million for BTS and up to €10.1 million for BTE.

The financing is designed to support major upgrades to the city’s district heating system, which plays a crucial role in supplying heat to homes and businesses, particularly during the harsh winter months.The project is being strengthened through additional support from the Green Climate Fund (GCF).

Concessional financing of up to €22.7 million will be provided through the GCF’s Green Cities Facility, including €16.8 million for BTS and €5.9 million for BTE. The package also includes investment grants totalling up to €10.7 million, with €6.5 million allocated to BTS and €4.2 million to BTE. In addition, the EBRD will provide €3.3 million in grant funding to support project implementation and the development of an equal opportunities action plan.

The investments will enable BTS to modernise its pumping stations and install small-scale solar photovoltaic battery systems, helping to improve operational efficiency and incorporate renewable energy into the heating network. BTE will undertake the installation of large-scale district energy heat pumps, the first such systems to be introduced in Central Asia, along with the modernisation of its boiler houses and the addition of new renewable energy technologies.

Both utilities will also upgrade their broader district heating networks, introduce advanced supervisory control and data acquisition (SCADA) systems to improve monitoring and operational management, and acquire specialised vehicles needed for network maintenance and service delivery.The project is expected to drive a significant transformation in Bishkek’s heating sector by reducing dependence on fossil fuels and increasing the use of cleaner energy technologies.

These upgrades are projected to deliver substantial reductions in greenhouse gas emissions while helping improve local air quality. This is particularly important for Bishkek, which experiences severe air pollution during winter and has been ranked among the world’s worst-performing cities for air quality during the colder months.

The investment aligns with the objectives of the EBRD Green Cities programme, of which Bishkek is a member. In 2024, the city launched a comprehensive Green City Action Plan focused on addressing environmental challenges, climate resilience, and economic inclusion. The modernisation of the district heating system was identified as one of the city’s most urgent infrastructure priorities due to its direct impact on energy efficiency, emissions reduction, and public health.

The project represents an important step towards creating a cleaner, more sustainable urban energy system in Bishkek while supporting the Kyrgyz Republic’s broader climate and environmental goals. By combining EBRD financing with support from the Green Climate Fund, the initiative demonstrates how international partnerships can help cities accelerate their transition to low-carbon infrastructure and improve quality of life for residents.

The EBRD has been operating in the Kyrgyz Republic since 1992 and has invested more than €1.16 billion through 286 projects across the country, with a strong focus on sustainable infrastructure development and private-sector growth.