Siemens Energy and the Afghanistan government have signed the Afghanistan Energy Hub agreement, to establish the country as an energy hub in central Asia. This multi-phase agreement aims to develop a modern, sustainable, and cost-effective power system, incorporating the massive potential of renewable energy generation in Afghanistan. Prior to this, a Memorandum of Understanding had been signed between Siemens and the Government of Afghanistan in January 2019, to support the country’s sustainable development. 

The first phase of this agreement will focus on establishing the commercial and technical feasibility. The next phase will focus on grid expansion to build a national grid with international connections. It will also include the formation of local generation hubs utilizing renewable energy. The third and final phase will include expanding the renewable energy sector for sustainable and cost-effective energy production. 

At present, a small portion (28 per cent) of the country’s population has access to electricity with parts of the country’s grid network fragmented. Thus, this Afghanistan Energy Hub agreement aims to improve electricity access for greater economic growth through exploitation of the country’s vast domestic renewable energy potential.