We think of Russia as a major oil and gas producer, and it is. Renewable energy certainly does not make any great impact on its energy balance but Russian government officials are revisiting the idea of renewable energy as a potentially profitable business for the country, according to Glenn Meyers on the Planetsave website.
Russia Renewable Energy Report
Other than large hydroelectric plants in Russia, all other forms of renewable energy accounts for less than 1% of power generation capacity.
These metrics come from Russia Direct, which reports when it comes to wind, solar and geothermal energy, Russia’s renewable potential is terrifyingly underdeveloped.
Russia’s economically viable wind resources are situated along coastal areas – those of the Pacific and Arctic Oceans, and the Caspian, Azov and Black Seas. Although the bulk of the most promising locations are in no man’s land, many companies have been monitoring sites and conducting feasibility studies in the Far Eastern and Black Sea regions.
Presently there are only four functioning wind power plants in Russia with a combined capacity roughly on par with Guyana or Curaçao (approx. 15MW). It is telling that after Crimea became a part of the Russian Federation, Russia’s wind power capacity increased many times over owing to Crimea’s 6 operational wind plants (74 MW) – however, most of them do not function due to uncertainties over their legal status.
Solar energy production in Russia is expanding, in part, due to interest from businessmen close to the Kremlin.
“Viktor Vekselberg’s RENOVA and the Anatoly Chubais-led Rosnano invested heavily in Hevel, a solar system manufacturer based in Chuvashia, and surprisingly enough, during tenders held in 2014-2015, solar outperformed wind and geothermal with a project portfolio of almost 1200 MW installed capacity.
“The Southwestern part of Russia, particularly the Northern Caucasus, Black and Caspian Sea regions, as well as Southern Siberia and the Far East, constitute the most lucrative zones for solar development with an average radiation level of 1400 kWh/m2 per year – roughly the same as in Bavaria’s sunniest spots.”
Russian geothermal production capacity has tripled over the last decade to 82 MW, its current level of development is regarded as underdeveloped. There are many geothermal sources available in Northern Caucasus, Kamchatka, and the Kuril Islands. According to Russia Direct, “Russia could potentially rival the world-leading United States (with 3.4 GW of power generation capacity).”
IFC Russia Renewable Energy Program
As featured by the International Finance Corporation (IFC), this program aims to mobilize investments and through advisory services increase the scale of private sector involvement in renewable energy.
“The Project also promotes a sustainable market for renewable energy in the Russian Federation by supporting the development of enabling policies, institutional capacity, introduction of financial mechanisms, and expanding access to finance.”
The IFC reports Russia’s current electricity generation portfolio is more than 220 GW installed capacity. Unfortunately, 68% of this capacity comes from oil, gas, or coal.
Some forecasts predict that Russian gas supply could, without significant additional upstream investment, fall short of projected domestic and export demand within the next few years.
“To meet increasing electricity demand, over the next two to four years Russia will need to add a minimum of 20,000 MW of new generating capacity. There is a growing realization by Russia’s policy makers and the private sector that increased use of energy efficient and renewable energy technologies can help meet the growing demand for energy resources. The Energy Strategy of Russia until 2020 sets the target for installed renewable electricity generation to 4.5% by 2020.”
The IFC contends Russia’s abundant resource base of renewable energy sources, with enabling legislation and proper industry support mechanisms in place, achieving the 4.5% target is viable. To accomplish this, however, will require approximately 22 GW of new installed capacity and displace more than 36 million tons of CO2 per year. On the fiscal side, this means approximately $44 billion in capital investment is required.
Key expected Impact
- Direct GHG emission reductions (CO2 eq), estimated at a cumulative 5 million tons over a 20-year investment lifetime, and estimated indirect GHG emissions reductions between 20 and 200 million tons;
- Introduction of an enabling regulatory and incentive framework for renewable-based power;
- 205 MW installed capacity of new renewable power generation.
Planning for the future
According to the nonprofit Bellona Foundation, which targets climate, renewable energy, and pollution issues, Russian government officials are revisiting the idea of renewable energy as a potentially profitable business for the country.
Deputy Energy Minister Alexei Teksler spoke at a conference in Abu-Dhabi, saying renewable energy in Russia “has serious economic foundations” and would be “profitable” for the Russian economy, according to the official TASS newswire.
He added, “within the next 20 years, it’s planned to boost by 10 times the production of energy from renewable sources” in Russia. By 2024, he said the Russian government wants to see 8 to 10 gigawatts of its power coming from renewable sources.
For all of the vast renewable energy resources Russia has at its hand, we certainly hope to report on these future developments.