Green Finance and Investment G r e e Promoting Clean Urban Public Transportation n F in Green Finance and Investment and Green Investment in Kazakhstan a n c e a Green growth means achieving economic growth while reducing pollution and greenhouse gas emissions, n Promoting Clean Urban Public d minimising waste and improving efficiency in the use of natural resources. This requires long-term In investment and sustained financing. Public budgets have traditionally been an important source of green v e Transportation and Green infrastructure financing. But given the strains on public finances, large-scale private investment will be s t m needed for the transition towards a green economy. Governments have a key role to play in strengthening e domestic policy frameworks to catalyse and mobilise private finance and investment in support of green n t Investment in Kazakhstan growth. It is necessary to better align and reform policies across the regulatory spectrum to overcome barriers to green investment, and to provide an enabling environment that can attract both domestic and international investment. This OECD series on Green Finance and Investment provides policy analysis and guidance to scale up financing and investment in technologies, infrastructure and companies that will be critical in the transition P r to a low-carbon, climate-resilient and resource-efficient economy. o m o This report discusses the main results of a project on how to reduce air pollution from urban public transport t in in Kazakhstan, by providing an analysis for designing a green public investment programme in this sector. g This sector represents an opportunity for Kazakhstan to address key objectives in its environmental C le and climate-related policies as part of the country’s ambitions to transition to a green economic path a n of development. The investment programme is also designed to support the modernisation of the urban U transport fleet in the country and stimulate the domestic market to shift to modern buses powered by clean r b fuels. The programme is foreseen to be implemented in two phases: the first covers the cities of Kostanay a n and Shymkent and the second, all major urban centres in Kazakhstan. These investments are expected to result P u in significant air improvement. b lic T r a n s p o r t a t io n a n d G r e e n In v e s t m e n t in K a z a k h Consult this publication on line at http://dx.doi.org/10.1787/9789264279643-en. s t a This work is published on the OECD iLibrary, which gathers all OECD books, periodicals and statistical databases. n Visit www.oecd-ilibrary.org for more information. Isbn 978-92-64-27963-6 97 2017 43 1 P 9HSTCQE*chjgdg+ (cid:42)(cid:53)(cid:40)(cid:40)(cid:49) (cid:4)(cid:6)(cid:23)(cid:12)(cid:18)(cid:17)(cid:3)(cid:3)(cid:23)(cid:4)(cid:22)(cid:14)(cid:3)(cid:9)(cid:18)(cid:21)(cid:6)(cid:8) GOVERNMENT OF THE REPUBLIC OF KAZAKHSTAN Green Finance and Investment Promoting Clean Urban Public Transportation and Green Investment in Kazakhstan This work is published under the responsibility of the Secretary-General of the OECD. The opinions expressed and arguments employed herein do not necessarily reflect the official views of OECD member countries. This document, as well as any data and any map included herein, are without prejudice to the status of or sovereignty over any territory, to the delimitation of international frontiers and boundaries and to the name of any territory, city or area. Please cite this publication as: OECD (2017), Promoting Clean Urban Public Transportation and Green Investment in Kazakhstan, Green Finance and Investment, OECD Publishing, Paris. https://doi.org/10.1787/9789264279643-en ISBN 978-92-64-27963-6 (print) ISBN 978-92-64-27964-3 (PDF) Series: Green Finance and Investment ISSN 2409-0336 (print) ISSN 2409-0344 (online) Revised version, July 2018 Details of revisions available at: http://www.oecd.org/about/publishing/Corrigendum_KAZ_Transport.pdf The statistical data for Israel are supplied by and under the responsibility of the relevant Israeli authorities. The use of such data by the OECD is without prejudice to the status of the Golan Heights, East Jerusalem and Israeli settlements in the West Bank under the terms of international law. Photo credits: Cover © mika48/Shutterstock.com. Corrigenda to OECD publications may be found on line at: www.oecd.org/about/publishing/corrigenda.htm. © OECD 2017 You can copy, download or print OECD content for your own use, and you can include excerpts from OECD publications, databases and multimedia products in your own documents, presentations, blogs, websites and teaching materials, provided that suitable acknowledgment of the source and copyright owner(s) is given. All requests for public or commercial use and translation rights should be submitted to [email protected]. Requests for permission to photocopy portions of this material for public or commercial use shall be addressed directly to the Copyright Clearance Center (CCC) at [email protected] or the Centre francais d’exploitation du droit de copie (CFC) at [email protected]. FOREwORD – 3 Foreword This report presents the main findings and conclusions from the project on “Promoting Green Growth and Low-Carbon Development: Analysis and Support to Policy Dialogue on Key Governance Elements of the Green Economy Concept in Kazakhstan”, implemented within the framework of the OECD-Kazakhstan Co-operation Programme and the GREEN Action Task Force, for which the OECD provides a secretariat. The main objective of this work was to assist the Ministry of Energy of Kazakhstan to design a green investment programme that will be financed by public funds, with the purpose of stimulating demand for green investments in the country. The focus of the investment programme is on reducing air pollution and greenhouse gas (GHG) emissions from the public transport sector. Two cities were identified to participate in the first, pilot, phase of the investment programme, Kostanay and Shymkent. In a second phase, the programme is designed to be extended to cover the major urban centres in the country. The report draws not only on the extensive review of environmental legislation – reflecting in particular that of Kazakhstan and the European Union – and technical regulations regarding public transport, but also on extensive primary and secondary data collection in Kazakhstan in the areas of environment, transport and public services. The project contained four main activity areas and outputs: i) an initial scoping and analytical stage; ii) development of a programme costing methodology; iii) design of a programme in line with international good practices; and iv) preparation of an analytical report and training. Activity areas ii) and iii) constituted the backbone of the project, with the aim of demonstrating in practice how to use scarce public funds to incentivise the private sector to invest in clean and socially-important projects. As part of the second activity, a model was designed to support the analysis of the programme and its development. This Excel-based tool was called Optimising Public Transport Investment Costs (OPTIC) model. The model assists in the calculation and optimisation of total programme costs, for both the public financier and private sector investors, the optimal level of the subsidy and the air pollution and greenhouse gas emission reductions that can be achieved as a result of programme implementation. The model is an analytical tool that can help the decision-making process become more objective and more transparent. Over the course of 2016, the project team visited Kazakhstan on several occasions, and had the chance to discuss different elements of the investment programme with a number of experts from government offices in Astana, Kostanay and Shymkent, as well as with experts from various international organisations active in the country. we are grateful to all colleagues who took the time to meet and share their ideas and knowledge with us, helping us better formulate and shape the investment programme. we greatly benefited from the discussions during the stakeholder meeting held in Astana on 13-14 December 2016. we are thankful to participants for their constructive suggestions on improving programme analysis. PROMOTING CLEAN URBAN PUBLIC TRANSPORT IN KAZAKHSTAN: DESIGNING A GREEN INVESTMENT PROGRAMME © OECD 2017 4 – FOREwORD The project was managed by Nelly Petkova with support by David Simek (both OECD). This work, however, would not have been possible without the substantive inputs of consultants Rafal Stanek and David Toft (Kommunalkredit Public Consulting) and the national expert Bakhyt Bayanova (Center for Trade Policy and Development, Ministry of National Economy of Kazakhstan). Their commitment to this work is very much appreciated. Special thanks go to our colleagues from the Ministry of Energy, Makpal Yesmurzina and Olga Melnik, for their help during project implementation. we would also like to particularly thank Yelena Yerzakovich (United Nations Development Programme), Aigul Kussaliyeva (Astana International Finance Center) and Yerbol Tokhtarov and Talgat Arystanbayev (KazTransGaz Onimderi) for their substantive review of the report and thoughtful feedback. we are also grateful to Kumi Kitamori and Krzysztof Michalak (OECD) for their comments and support for this work. Inmaculada Valencia and Irina Belkahia of the OECD provided overall administrative support to the project, while Natalia Chumachenko and Lilia Kucharska translated the report into Russian. The authors would like to thank Victoria Elliot and Peter Vogelpoel for their help with editing and layout, as well as Janine Treves and Lupita Johanson who assisted with the processing of the publication. The project was financially supported by the Government of Kazakhstan through the Ministry of Energy. All these contributions are gratefully acknowledged. The views expressed in this report are those of the authors and do not necessarily reflect those of the OECD or its member countries. PROMOTING CLEAN URBAN PUBLIC TRANSPORT IN KAZAKHSTAN: DESIGNING A GREEN INVESTMENT PROGRAMME © OECD 2017 TABLE OF CONTENTS – 5 Table of contents Abbreviations and acronyms . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .9 Executive summary . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .13 Chapter 1. Programme rationale and main elements of design. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 17 Main elements of the Green Public Investment Programme in Kazakhstan. . . . . . . . . . . . . . . . . . . . .18 Justification for the investment programme . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .23 Note . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .26 References . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .27 Chapter 2. Programme costs, financing and expected outcomes . . . . . . . . . . . . . . . . . . . . . . . . . . . .29 Programme objectives and project pipelines . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .30 Timeframe for implementing the CPT Programme. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .30 Estimated costs and outcomes of the CPT Programme. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 31 Financing strategy and optimal co-financing level . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .44 Social impact of programme implementation . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .47 Types of eligible projects and eligible project costs. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .48 Types of eligible beneficiaries . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .49 Project eligibility criteria. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .49 Project appraisal criteria . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .50 Conclusions for the CPT Programme . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .51 Notes. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .52 References . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .52 Chapter 3. Review of macro-economic and environmental conditions. . . . . . . . . . . . . . . . . . . . . . . .53 Demographic and macro-economic situation . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .54 Kazakhstan’s urban public transport system. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .56 Greenhouse gas emissions and air pollution in Kazakhstan. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .60 Conclusions for the CPT Programme . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .66 Note . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .66 References . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .67 Chapter 4. Policy and regulatory framework for the transport sector. . . . . . . . . . . . . . . . . . . . . . . .69 Regulatory framework for urban public transport in Kazakhstan. . . . . . . . . . . . . . . . . . . . . . . . . . . . .70 Regulatory framework for air pollution. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .75 Conclusions for the CPT Programme . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .77 Notes. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .77 References . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .77 Chapter 5. Market analysis of clean fuels and technologies. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .81 Overview of clean technologies and fuels in the bus transport sector. . . . . . . . . . . . . . . . . . . . . . . . . .82 The market for compressed natural and liquefied petroleum gas in Kazakhstan. . . . . . . . . . . . . . . . .83 PROMOTING CLEAN URBAN PUBLIC TRANSPORT IN KAZAKHSTAN: DESIGNING A GREEN INVESTMENT PROGRAMME © OECD 2017 6 – TABLE OF CONTENTS Production and import of buses. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .89 Public transport fares. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .92 Available co-financing for investment projects. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .92 Conclusions for the CPT Programme . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .96 Notes. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .97 References . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .98 Chapter 6. Institutional arrangements for implementing the programme. . . . . . . . . . . . . . . . . . . . 101 Institutional arrangements to manage a public investment programme . . . . . . . . . . . . . . . . . . . . . . .102 Proposal for CPT Programme institutional set-up. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .104 Minimum elements for operating regulations . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .105 Programme promotion. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .106 Public private partnerships. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .106 Need for complementary (non-institutional) policy action . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .107 Conclusions for the CPT Programme . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 110 Notes. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 110 References . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 110 Chapter 7. Proposed procedures for project cycle management . . . . . . . . . . . . . . . . . . . . . . . . . . . . 113 Pilot phase . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 114 Second phase . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 114 Settling payments with contractors . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 117 Control and monitoring of project effects . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 119 Maintenance of a database of project and programme effects. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 119 Conclusions for the CPT Programme . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 119 Notes. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .120 Annex A. Overview of clean technologies and fuels in the transport sector . . . . . . . . . . . . . . . . . . 121 Compressed natural gas buses. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 121 LPG buses (where CNG is not available). . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .123 Diesel buses with Euro VI engines . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .124 Electric buses. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .126 Notes. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .128 References . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .128 Annex B. Explanatory guide for the use of the OPTIC model. . . . . . . . . . . . . . . . . . . . . . . . . . . . . .129 Purpose of the OPTIC model. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .129 Overall structure of the OPTIC model. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .129 Preparations to start using the OPTIC model . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .130 Determining the subsidy level . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 132 Cost calculation . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .134 Emission reductions calculation. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 137 Programme costing and environmental effects. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 137 Programme costing for Phase 1 (pilot phase) and Phase 2 (scaling-up phase) . . . . . . . . . . . . . . . . . . 139 Sources of information used in the assumptions. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 139 Notes. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 143 References . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 143 Annex C. Example of a project application form . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 145 Annex D. Example of a project pre-appraisal form . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 147 Annex E. Example of a project appraisal form. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 149 PROMOTING CLEAN URBAN PUBLIC TRANSPORT IN KAZAKHSTAN: DESIGNING A GREEN INVESTMENT PROGRAMME © OECD 2017 TABLE OF CONTENTS – 7 Figures Figure 2.1 Proposed timeline . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 31 Figure 2.2 Projection for reducing CO emissions and air pollutants in Kostanay, 2017-21 . . . . . . . . .34 2 Figure 2.3 Projection for reducing CO emissions and air pollutants in Shymkent, 2017-21 . . . . . . . .35 2 Figure 2.4 Amount of reduced GHG emissions in 19 cities of Kazakhstan, Scenario 1, 2020-24 . . . .36 Figure 2.5 Potential reduction of CO and air pollutants as a result of the programme. . . . . . . . . . . . .43 2 Figure 2.6 Relationship between purchase price and fuel costs for diesel and alternatively powered buses . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .46 Figure 2.7 Relationship between consumption and fuel price for diesel and alternatively powered buses . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .46 Figure 2.8 Share of public and private costs in financing the two phases of the programme. . . . . . . .47 Figure 2.9 Altering the age structure of the bus fleet in Kazakhstan . . . . . . . . . . . . . . . . . . . . . . . . . .48 Figure 3.1 Natural increase of the population in selected EECCA countries . . . . . . . . . . . . . . . . . . . .54 Figure 3.2 GDP per capita in Kazakhstan . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .55 Figure 3.3 Passenger transport by transport enterprises in Kazakhstan . . . . . . . . . . . . . . . . . . . . . . . .55 Figure 3.4 Cargo transport by transport enterprises in Kazakhstan, excluding pipeline transport . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .56 Figure 3.5 Public transport fleet composition by age (number of vehicles and % distribution of total). . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .57 Figure 3.6 Public transport fleet composition by fuel type (number of vehicles and % distribution of total). . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .57 Figure 3.7 GHG emissions generated by the transport sector in Kazakhstan. . . . . . . . . . . . . . . . . . . .60 Figure 3.8 GHG emissions from motor vehicles in Kazakhstan compared to total emissions, 1990-2014 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .61 Figure 3.9 Assumed amount of health-damaging substances emitted per distance travelled (normative) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .65 Figure 3.10 Assumed amount of health-damaging substances emitted per distance travelled (real) . . .66 Figure 4.1 Development of European emissions standards . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .73 Figure 5.1 Relation between production of natural gas and CNG in Kazakhstan. . . . . . . . . . . . . . . . .86 Figure 5.2 Production and consumption of liquefied petroleum gas in Kazakhstan. . . . . . . . . . . . . . .86 Figure 5.3 Production of cars, trucks and tractors in selected EECCA countries, 2000-13 . . . . . . . . .90 Figure 6.1 Management scheme for the Austrian JI/CDM programme. . . . . . . . . . . . . . . . . . . . . . . . 103 Figure 7.1 Payment scheme, Option 1: Beneficiary receives public funds . . . . . . . . . . . . . . . . . . . . . 117 Figure 7.2 Payment scheme, Option 2: Implementation Unit pays the contractor directly. . . . . . . . . 118 Figure 7.3 Payment scheme, Option 3: PPP company receives public funds as equity. . . . . . . . . . . . 118 Figure B.1 Percentage of tested vehicles that exceed Euro limits in urban cycle. . . . . . . . . . . . . . . . . 142 Tables Table 2.1 Key input and output parameters of the pilot programme in Kostanay . . . . . . . . . . . . . . . .33 Table 2.2 Key input and output parameters of the pilot programme in Shymkent. . . . . . . . . . . . . . . .35 Table 2.3 Key input and output parameters of the programme’s pilot phase. . . . . . . . . . . . . . . . . . . .36 Table 2.4 Key input and output parameters of the assessed programme scenarios . . . . . . . . . . . . . . .37 Table 2.5 Key parameters of the assessed CPT Programme – Phase 2, Scenario 1, normative pollution factors . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .38 Table 2.6 Key parameters of the assessed CPT Programme – Phase 2, Scenario 2, normative pollution factors . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .39 Table 2.7 Key parameters of the assessed CPT Programme – Phase 2, Scenario 1, real pollution factors . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .40 Table 2.8 Key parameters of the assessed CPT Programme – Phase 2, Scenario 2, real pollution factors . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .41 Table 2.9 Summary of programme costs, KZT million. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .42 Table 2.10 Summary of programme costs, USD million. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .42 Table 2.11 Summary of public support for the programme. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .45 PROMOTING CLEAN URBAN PUBLIC TRANSPORT IN KAZAKHSTAN: DESIGNING A GREEN INVESTMENT PROGRAMME © OECD 2017 8 – TABLE OF CONTENTS Table 3.1 Bus public transport fleet of Kazakhstan, by age and fuel type (electric transport excluded). . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .58 Table 3.2 Air pollution indices . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .62 Table 3.3 Level of air pollution in large cities of Kazakhstan, 2015 . . . . . . . . . . . . . . . . . . . . . . . . . .62 Table 4.1 Bus classes according to category and capacity. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .70 Table 4.2 Upgrading schedule for buses, minibuses and trolleybuses under standard contracts. . . . .71 Table 4.3 Schedule for reduction in the share of outdated buses on regular passenger routes. . . . . . .71 Table 4.4 Emission requirements for buses with petrol-powered engines. . . . . . . . . . . . . . . . . . . . . .72 Table 4.5 Emission requirements for hybrid transport vehicles and power units. . . . . . . . . . . . . . . . .72 Table 4.6 Introduction of European emissions standards in the EU and in Kazakhstan. . . . . . . . . . .73 Table 4.7 Energy-efficiency indicators for vehicles by type of engine . . . . . . . . . . . . . . . . . . . . . . . .75 Table 5.1 Production of natural gas in gaseous and liquid form, 2013-16, million m3. . . . . . . . . . . . .85 Table 5.2 Excise tax rates on petrol and diesel fuel . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .88 Table 5.3 Average fuel producer price, net of VAT and excise tax. . . . . . . . . . . . . . . . . . . . . . . . . . . .88 Table 5.4 Average retail price of various fuels. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .89 Table 5.5 Actual purchase price of buses. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .91 Table A.1 EU emission standards for heavy-duty diesel engines, steady-state testing. . . . . . . . . . . .125 Table A.2 EU emission standards for heavy-duty diesel engines, transient testing . . . . . . . . . . . . . .125 Table A.3 Comparison of fuels to power buses for urban public transport. . . . . . . . . . . . . . . . . . . . .127 Table B.1 Basic assumptions: bus prices and fuel consumption. . . . . . . . . . . . . . . . . . . . . . . . . . . . .130 Table B.2 Assumed emission factors according to emission norms (per km) . . . . . . . . . . . . . . . . . . 131 Table B.3 Public transport and transport infrastructure in selected cities in Kazakhstan. . . . . . . . . 131 Table B.4 Assumptions for calculating the level of public support for CNG buses . . . . . . . . . . . . . . 132 Table B.5 Calculation of the level of public support for CNG buses (KZT 1 000). . . . . . . . . . . . . . . 132 Table B.6 Assumptions for calculating the level of public support for LPG buses. . . . . . . . . . . . . . . 132 Table B.7 Calculation of the level of public support for LPG buses (KZT 1 000) . . . . . . . . . . . . . . . 133 Table B.8 Assumptions for calculating the level of public support for modern diesel buses . . . . . . . 133 Table B.9 Calculation of the level of public support for modern diesel buses (KZT 1 000) . . . . . . . 133 Table B.10 Subsidy calculation for public support for replacement of buses . . . . . . . . . . . . . . . . . . . . 133 Table B.11 Investment costs, subsidies and net costs for beneficiaries . . . . . . . . . . . . . . . . . . . . . . . . 135 Table B.12 Emission reduction based on the purchase of new buses . . . . . . . . . . . . . . . . . . . . . . . . . .136 Table B.13 Adjusting programme costs and environmental effects. . . . . . . . . . . . . . . . . . . . . . . . . . . 137 Table B.14 Relationship between programme costs and environmental effects. . . . . . . . . . . . . . . . . .138 Table B.15 Adjusting programme targets . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 139 Table B.16 EU emissions standards for heavy-duty diesel engines (g/kwh). . . . . . . . . . . . . . . . . . . .140 Table B.17 EU fuel standards . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .140 Table B.18 Estimated emission factors for European heavy-duty diesel vehicles . . . . . . . . . . . . . . . . 141 Table B.19 CO emission factor. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 141 2 Table B.20 Assumed fuel consumption. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 141 Table B.21 Assumed emissions factors adjusted to real values (per km). . . . . . . . . . . . . . . . . . . . . . . 142 Boxes Box 2.1 The OPTIC model. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .32 Box 3.1 Air quality assessment . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .61 Box 3.2 Diesel exhaust emissions. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .64 Box A.1 Main differences between CNG and LPG . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .122 Box A.2 Electricity production . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .126 Box B.1 Determining the optimal subsidy level. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .134 PROMOTING CLEAN URBAN PUBLIC TRANSPORT IN KAZAKHSTAN: DESIGNING A GREEN INVESTMENT PROGRAMME © OECD 2017