The government of the Republic of Altay and the administration of the Altay Territory have agreed to relaunch a project for the construction of a hydropower plant on the Katun river. The project was shelved during the collapse of the Soviet Union, and following environmental protests.

The two regions are to set up a joint-stock company called the Energy of Altay Rivers Corp which will draft design documentation and carry out a feasibility study for the hydro scheme. The plant will be located in the Altay mountains, 130km from Gorno-Altaysk. Total cost of the scheme is put at around $1 billion.

The region currently has insufficient capacity to supply local demand. The Republic of Altay receives all its power from Altay Territory; the latter imports 70 per cent of its electricity from neighbouring Siberia.

Under the newly proposed plans, the project will have a 50m dam, only one third of the height of the original proposal.

The Republic of Altay would consume around 15 per cent of the power generated. The remainder would be exported. Current levels of supply in the region are one quarter of that in most of Russia.