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RISKS IN FINANCING GREEN PROJECTS BY COMMERCIAL BANKS IN
UZBEKISTAN (2025–2030 OUTLOOK)
Au ho : Ka shie a Ma jona Alishe kizi
E-mail: [email p o ec ed]
In ecen yea s, Uzbekis an has made subs an ial p og ess in p omo ing g een and sus ainable
economic ans o ma ion. The go e nmen ’s “G een Economy S a egy o 2030” ou lines ambi ious
goals o educe ene gy in ensi y, expand enewable ene gy capaci y, and ensu e en i onmen al
sa e y
1
. Wi hin his amewo k, comme cial banks a e expec ed o play a pi o al ole in mobilizing
p i a e in es men owa d low-ca bon and clima e- esilien p ojec s.
2
Howe e , inancing g een p ojec s di e s om con en ional lending. I in ol es highe unce ain y,
new echnological and egula o y amewo ks, and longe payback pe iods. As a esul , banks ace a
complex mix o inancial, ope a ional, echnical, and policy isks ha mus be p ope ly iden i ied and
managed.
3
This epo analyzes key isk ypes aced by Uzbek comme cial banks in g een inancing
and p o ides p edic ions o hei e olu ion by 2030, based on cu en ends, ma ke de elopmen ,
and egula o y p og ess.
As epo ed by he OECD (2023)
4
, g een p ojec inancing in ol es complex isk s uc u es including
c edi , echnology, and egula o y isks.
1. C edi Risk (P ojec Viabili y and Repaymen Capaci y)
C edi isk emains he dominan conce n o banks inancing g een p ojec s. Many enewable ene gy
and ene gy e iciency p ojec s depend on new echnologies wi h unce ain ope a ional his o ies,
especially in Uzbekis an’s clima e and in as uc u e con ex .
By 2030, as he enewable sec o ma u es and go e nmen -backed c edi lines expand, he a e age
c edi isk is expec ed o dec ease om e y high o mode a e-high. Howe e , s a -ups and SMEs in
g een inno a ion will s ill ace limi ed colla e al and highe de aul p obabili y.
To mi iga e his, banks should de elop g een c edi sco ing models, collabo a e wi h de elopmen
inance ins i u ions (DFIs) o pa ial gua an ees, and implemen phased disbu semen linked o
miles ones.
2. Regula o y and Policy Risk
Uzbekis an’s policy en i onmen is ansi ioning apidly. Re o ms in enewable ene gy a i s,
en i onmen al codes, and in es men incen i es c ea e oppo uni ies bu also unce ain ies.
Policy isk is p ojec ed o decline om high o medium by 2030, as he go e nmen ha monizes
na ional g een inance s anda ds wi h in e na ional axonomies and clima e disclosu e amewo ks.
Ne e heless, ansi ion isk — linked o he g adual phase-ou o high-ca bon indus ies — will
inc ease.
1
Republic o Uzbekis an. (2022). Dec ee o he P esiden o he Republic o Uzbekis an No. PQ–4477 “On he S a egy o he
T ansi ion o he Republic o Uzbekis an o a G een Economy o 2030”. Tashken .
2
Wo ld Bank. (2023). Uzbekis an Coun y Clima e and De elopmen Repo . Washing on, DC: Wo ld Bank G oup.
3
The Asian De elopmen Bank (2024) emphasizes ha inancial ins i u ions in Cen al Asia ace s uc u al challenges in building
g een inance po olios due o limi ed isk assessmen expe ience.
4
OECD. (2023). G een Finance and In es men : Managing En i onmen al and Clima e Risks. Pa is: OECD Publishing.
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Banks a e encou aged o pe o m policy s ess es s, main ain dialogue wi h ene gy and inance
minis ies, and inco po a e egula o y change scena ios in o isk assessmen s.
3. Ma ke and P ice Risk
Ma ke isks s em om ola ili y in ene gy p ices, ca bon c edi alues, and demand o enewable
ene gy. Cu en ly, mos p ojec s ely on ixed Powe Pu chase Ag eemen s (PPAs), bu elec ici y
ma ke libe aliza ion will g adually expose hem o p ice luc ua ions.
By 2030, he de elopmen o anspa en ma ke mechanisms and ca bon ading schemes will
s abilize p ices, hough compe i ion will igh en ma gins. Ma ke isk will likely emain mode a e.
Banks should p omo e indexed PPAs, hedging ins umen s, and po olio di e si ica ion ac oss
echnologies and egions.
4. Technical and Technology Risk
Many g een echnologies in Uzbekis an a e impo ed, c ea ing dependence on o eign expe ise and
pa s. Technical ailu es o poo main enance can unde mine p ojec iabili y.
By 2030, as local manu ac u ing and se ice capaci y g ows, his isk will all om e y high o
medium. Howe e , he ise o digi alized sma -g id sys ems will in oduce cybe -physical
ulne abili ies.
The e o e, banks mus equi e independen echnical audi s, pe o mance gua an ees, and cybe isk
insu ance o p ojec s ha use au oma ed sys ems.
Table1. P edic ed Risk E olu ion Summa y (2025–2030)
5
Risk Type
2024 Le el
2030 Fo ecas
T end
Key D i e s
C edi Risk
Ve y High
Mode a e-High
↓
DFI gua an ees,
p ojec ma u i y
Regula o y /
Policy
High
Medium
↓
S able g een
inance s anda ds
Ma ke / P ice
Mode a e
Mode a e
→
Libe aliza ion,
ca bon p icing
Technical /
Technology
Ve y High
Medium
↓
Local capaci y,
sma -g id
Ope a ional
High
Low-Medium
↓
Capaci y building
Repu a ional
Mode a e
Mode a e
→
G een axonomy,
epo ing
FX / In e es Ra e
High
Medium-High
↓
Local g een
bonds
MRV
High
Medium
↓
Digi al da a
sys ems
5
De eloped by he au ho based on he Republic o Uzbekis an’s “G een Economy S a egy–2030” (P esiden ial Dec ee No. PQ–
4477, Decembe 4, 2022), in e na ional me hodologies om he Wo ld Bank, IFC, ADB, and OECD G een Finance
F amewo ks, and expe -based assessmen o isk likelihood and impac o comme cial banks in Uzbekis an (2025–2030
p ojec ion).
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Risk Type
2024 Le el
2030 Fo ecas
T end
Key D i e s
Liquidi y
High
Medium
↓
Capi al ma ke
de elopmen
En i onmen al
Liabili y
Medium
Low-Medium
↓
S onge
en i onmen al
codes
5. Ope a ional Risk
Ope a ional isk a ises om insu icien in e nal capaci y among banks — including lack o
knowledge abou en i onmen al isk assessmen , MRV (Measu emen , Repo ing, Ve i ica ion), and
ESG compliance.
Due o ongoing capaci y-building p og ams suppo ed by he Asian De elopmen Bank (ADB),
In e na ional Finance Co po a ion (IFC), and G een Clima e Fund (GCF), ope a ional isk is expec ed
o dec ease o low-medium by 2030.
Banks should in eg a e ESG app aisal checklis s and dedica ed g een inance uni s in o hei
o ganiza ional s uc u es.
6. Repu a ional Risk
The g owing popula i y o g een inance inc eases exposu e o accusa ions o “g eenwashing” —
when p ojec s labeled as g een do no deli e measu able en i onmen al bene i s.
By 2030, as na ional g een axonomy e i ica ion becomes manda o y and public epo ing expands,
epu a ional isk will shi owa ds compliance isk. O e all le el will emain mode a e, bu
anspa ency expec a ions will ise sha ply.
Banks should ensu e independen alida ion, publish annual sus ainabili y epo s, and adop
anspa en impac me ics o sa egua d hei epu a ion.
7. Fo eign Exchange (FX) and In e es Ra e Risk
Many enewable p ojec s a e inanced in o eign cu ency (USD o EUR), while e enues a e in
Uzbek sum (UZS), c ea ing a misma ch.
By 2030, wi h he expec ed de elopmen o a local g een bond ma ke and local-cu ency c edi lines,
FX isk will sligh ly decline bu emain medium-high due o exchange a e ola ili y.
Banks should p io i ize local-cu ency lending, cu ency-swaps, and sha ed hedging cos s wi h
p ojec de elope s.
8. Measu emen , Repo ing & Ve i ica ion (MRV) Risk
Accu a e MRV is essen ial o de e mining eal en i onmen al impac and o accessing pe o mance-
based incen i es. Cu en sys ems in Uzbekis an ely hea ily on manual da a collec ion, inc easing
he isk o e o .
By 2030, digi al MRV sys ems (using IoT senso s and blockchain-based egis ies) will signi ican ly
imp o e anspa ency, educing isk om high o medium. Howe e , da a gaps may pe sis o small-
scale p ojec s.
Banks should in es in AI-d i en moni o ing, ain audi o s, and link MRV sys ems o na ional
clima e da abases.
9. Liquidi y Risk
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G een p ojec s ypically equi e long- e m inancing (10–15 yea s), bu mos Uzbek banks ely on
sho - e m deposi s.
The de elopmen o g een bonds, secu i iza ion, and ins i u ional in es o pa icipa ion will enhance
liquidi y and ma u i y ma ching. Thus, liquidi y isk is p ojec ed o all om high o medium by 2030.
Banks should main ain liquidi y bu e s, explo e co e ed bond s uc u es, and pa icipa e in capi al
ma ke e o ms.
10. En i onmen al Liabili y Risk
I a inanced p ojec causes pollu ion o ails en i onmen al compliance, he inancing bank may ace
inancial penal ies o epu a ion damage.
By 2030, wi h s ic e En i onmen al Codes and manda o y due diligence, his isk will decline om
medium o low-medium, al hough en o cemen gaps could pe sis .
Banks should equi e en i onmen al insu ance, en o ce E&S co enan s, and moni o compliance
h ough pe iodic hi d-pa y audi s.
Be ween 2025 and 2030, Uzbekis an’s inancial sec o is expec ed o unde go a majo ansi ion om
isk-a e se g een lending o s a egically managed sus ainable inance. While he o e all isk p o ile
will decline, new challenges — especially in da a e i ica ion, cybe - isk, and egula o y compliance
— will eme ge.
Banks ha in es ea ly in in e nal capaci y, MRV echnology, and blended inance pa ne ships will
be able o expand hei g een po olios sa ely and p o i ably. Mo eo e , alignmen wi h in e na ional
s anda ds such as he EU G een Taxonomy and IFC Pe o mance S anda ds will help a ac o eign
in es o s.
In conclusion, he nex i e yea s ep esen a pi o al window o comme cial banks in Uzbekis an o
es ablish obus g een inance sys ems. Wi h app op ia e isk managemen , anspa ency, and
inno a ion, hey can ans o m po en ial isks in o long- e m oppo uni ies o bo h p o i and
sus ainabili y.
REFERENCES:
1. Asian De elopmen Bank. (2024). G een Finance in Cen al Asia: Oppo uni ies and Risk
Managemen F amewo ks. Manila: ADB Publica ions.
2. In e na ional Finance Co po a ion (IFC). (2023). Sus ainable Banking and G een Finance: Global
P ac ices and Lessons o Eme ging Economies. Washing on, DC: Wo ld Bank G oup.
3. OECD. (2023). G een Finance and In es men : Managing En i onmen al and Clima e Risks. Pa is:
OECD Publishing.
4. Republic o Uzbekis an. (2022). Dec ee o he P esiden o he Republic o Uzbekis an No. PQ–
4477 “On he S a egy o he T ansi ion o he Republic o Uzbekis an o a G een Economy o
2030”. Tashken .
5. Uni ed Na ions De elopmen P og amme (UNDP). (2023). G een T ansi ion in Uzbekis an:
Financing Mechanisms and Policy Insigh s. Tashken : UNDP Uzbekis an.
6. Wo ld Bank. (2023). Uzbekis an Coun y Clima e and De elopmen Repo . Washing on, DC:
Wo ld Bank G oup.
7. Zhang, Y., & Kuma , S. (2023). Assessing inancial isks in sus ainable p ojec inance: A
compa a i e analysis o eme ging ma ke s. Jou nal o Sus ainable Finance & In es men , 13(4), 811–
829. h ps://doi.o g/10.1080/20430795.2022.2063447
8. Rahman, M., & Chowdhu y, T. (2022). Comme cial banks and he inancing o g een p ojec s:
E idence om de eloping economies. En i onmen al Economics and Policy S udies, 24(6), 1001–
1022. h ps://doi.o g/10.1007/s10018-022-00341-5
