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25 Aug, 2009 07:37

Russian renewable energy prepares for a bigger slice of the power pie

Russian renewable energy prepares for a bigger slice of the power pie

As the world’s largest producer of gas, and one of the worlds major producers of oil and coal, Russia isn’t generally seen as being at the forefront of the global thrust towards greater use of renewable energy sources.

There is a good reason for this – Russia ranks amongst the world’s top oil, gas and coal producers, with reserves of all which most of the rest of the world would envy. But it has a downside. Russia is one of the world most inefficient users of energy, and with the world increasingly looking to promote renewable energy, it means that Russia’s renewable energy sector hasn’t been as prominent as those elsewhere.

That outlook is slowly beginning to change with a range of projects across Russia looking to promote biofuels, wind energy, geothermal power, water power, and even solar energy. But it doesn’t mean things are easy for the pioneers of Russia’s renewable energy renaissance, with legislative hurdles, financing problems, artificially cheap mainstream sources of energy, and a general public perception that Russia has so much hydrocarbon based energy that renewable energy doesn’t need to be a focus just yet. Despite this backdrop corporate and political leaders are increasingly preparing for a future where renewable energy is a far greater part of the energy mix than it currently is.

Renewable potential

The natural environment provides Russia with possibly the world’s best scope for making use of the potential of renewable energy. Between the vast acreages of vegetation which could conceivably become biofuel raw materials, and some of the worlds largest virtually untapped snow fed rivers which could be harnessed further for hydro power, there’s also the geothermal energy potential of active tectonic zones in the far east, a belt across the country which could support solar power generation, and much of the same which could support wind power generation. Oleg Popel, a renewable energy expert at the Russian Academy of Sciences, notes that the potential depends on the region, and that in some areas a mix of renewable energy types is likely to be better than one variety alone, but that taken as a whole, Russia has massive renewable potential.

“Russia is a big country with various climatic conditions. It largely depends on the region we are talking about. Transbaikalia and Yakutia have a lot of sunny days, seaside areas are rich in strong winds, while Kamchatka and the Kuriles are known for their geothermal sources. A lot of Russia’s regions have favorable conditions for efficient use of biomass energy gained from waste timber conversion and agricultural waste conversion, etc. The energy of small rivers, sea tides on the Kola Peninsula, and the Sea of Okhotsk also have good prospects. In summer we could use the energy of sun while during colder months wind could provide for the necessary energy. A combination of, say, solar panels and windmills could be a good choice in some regions.”

Why isn’t it bigger?

Renewable energy currently comprises just 1% of Russia’s energy output, with the government planning to increase this to 4.5% by 2020, in the face of estimates suggesting that up to 30% of Russia’s energy demand could come from renewable sources.

That compares poorly with many international counterparts. The European Union is expecting to get 11.5% of its energy from renewable sources in 2010, rising to 20% by 2020 and 30% by 2030. In Canada the figure varies between 3.5% and 15% depending on the province, with the US figure varying between 5% and 30% depending on the state. Even fellow BRIC, India, is getting an estimated 10% of its energy from renewable sources.

The largest factor in why Russia doesn’t have a more sizeable renewable energy sector is its wealth of hydrocarbon based resources – copious amounts of oil, gas and coal. This coupled with a history which sees Russia dependent on energy exports for an estimated 80% of its foreign trade earnings has meant renewable sources have traditional been viewed as minor players.

The electricity generation capacity and transmission system that Russia has is a key factor impeding the takeup of renewable resources. Coal and gas plants provide most of Russia’s energy – with one renewable energy source, hydroelectric power, being the one shining light for the energy and ecology conscious – with massive historical investment meaning that the generation and transmission system in place, provides relatively reliable and cheap energy. Although the sector is being liberalized with a view to having market based prices in the medium term future, currently industrial and household consumers get their energy on the cheap, from the traditional sources, and with the government concerned about the inflationary potential of rapid increases in energy costs, it is expected that energy will remain cheap for some time to come. According to Popel this is a major factor in the relatively minor use of renewable energy in Russia so far.

“People in our country have got used to the idea that our resources of gas and oil are virtually inexhaustible, therefore both ordinary people and the government are quite relaxed about the future. Some federal and regional authorities simply don’t know enough about alternative energy and its advantages. At the same time prices and tariffs for centralized power supply services are still much lower compared to those in the rest of the world, which undermines the economic competitive advantage of renewables. And last, but not least, is insufficient financing of research, pilot planning and, most importantly, demonstration projects in Russia’s regions."

Despite this, Popel sees plenty of scope for increasing renewable energy use, starting the large areas of Russia which arent part of existing centralized supply networks.

“Renewables in Russia could hardly compete with centralized energy network, while it’s important to remember about those 2/3 of Russia’s territory (20 million people), that is not part of the centralized systems and where diesel energy already now is too expensive (in Yakutiya, for example, it’s more than 25 Roubles/KWth). And this (large territories with decentralized energy supply) makes a big difference from Europe, USA, Japan, etc. In this sphere renewables could be really useful and competitive already now. If, in terms of centralized energy supplies Renewables in Russia look poor compared to the rest of the world, then in terms of autonomous energy our country could set an ambitious goal to become the leader with the further plans to promote Russia’s technologies and equipment into developing world with decentralized energy.”

In addition to the perception that energy is inexhaustible Popel also refers to issues with the bureaucracy and administration not having process supportive for the development of renewable energy, and a looming gap in those with the skills to bring it about, on top of the current financial difficulties involved.

“Except insufficient funds, we don’t have a developed legislative system, which hinders the process greatly. But probably the main thing we need to do is to construct those demonstration projects that are so popular abroad. Actually, they let people see the real advantages and details of a particular project, thus convincing the public and authorities they do need them. Among other problems is the calculation of the best price for the energy derived from renewable sources, as well as the linking up process. At the same time, human resources are also decreasing. The age lag between scientists working today and young specialists is too big and in 4 or 5 years we’ll probably have no experienced staff.”

In the face of such issues, there are many who don’t believe that renewable energy will be getting any sort of serious attention in Russia for some time to come. Igor Vasiliev, energy sector analyst at Troika Dialog typifies the view of many who think that in Russia, at least, renewable energy promotion is an issue for later, with more pressing issues on the agenda for now.

“Almost all projects in the area are at the infant stage now with not much prospect of further development. As Russia has huge natural resources supply and it’s not pressing, the industry is very much unlikely to start developing.”

From little things, big things grow

But despite the difficulties there is movement into renewable energy with a range of projects across almost all forms green power starting to come into play. A large part of the reasoning behind this is the attitude of ordinary Russians, and their elected representatives. Like people around the world they are increasingly concerned about global warming and the environment, and they want to do something about it. Head of Renewable Energy Sources at RusHydro, Pavel Ponkratyev, a global leader in renewable energy, says this is a key development driver.

“In 2008, we conducted research while looking at the regulatory framework on renewable energy. The majority of the respondents spoke in support of the Renewable Energy Sources (RES) projects. The positive and approving attitude of the respondents proved that Russian thinking is similar to European thinking on “green” electric power. This, in large part, is due to the public information and education about the meaning and possibilities of the renewable energy under modern economic and ecological conditions.”

So, currently, renewable energy in Russia is on the move, on a broad front. In the coming weeks RT will be taking a look at each major renewable energy sector and what is taking place in Russia, commencing from this general overview.


A key part of Russia’s energy mix and the country’s strongest green energy suite remain the operations of RusHydro, with a generating capacity of 25 gigawatts (GW), and its origins in the massive engineering schemes of the Soviet era. The partially state owned company is a key vehicle through which the Russian government is pushing a greater emphasis on renewable energy, and within the last year has developed a strategy on renewable resources through to the year 2020 encompassing geothermal, wind, tidal, and hydro power.


Currently Russia has wind power operations in Kaliningrad with a capacity of 5.1 megawatts, to go with a 2.5 megawatt capacity wind power station in remote Chukotka, and a further 2.2 megawatts of capacity in Bashkortostan. New wind power projects in the pipeline include those in the Leningrad and Krasnodar region, to go with plants scheduled for Dagestan, Primorski Krai, Karelia, Magadan and Altai, which are expected to add a further 276 megawatts to Russia’s wind power generation capacity.


Surprisingly in the minds of some, Russia has a range of suitable locations for pushing the use of solar power, with large expanses of Siberia and the Russia Far East, as well as the region between the Black and Caspian seas. Russia’s state owned nanotechnology corporation, Rusnano, has recently committed to supporting the development of polysilicons and monosilane in Irkutsk and the establishment of solar batteries in Novocheboksarsk.


Russia currently has four major geothermal power stations in Kamchatka for which expansion proposals are being developed. There is currently 80 megawatts capacity from these plants with plans to expand this beyond 120 megawatts. Russia also has smaller geothermal plants in the Stavropol region and the Kurile islands.


The vast bulk of Russia’s agricultural potential isn’t being used, with experts estimating Russia’s capacity to produce biofuels at 850 million litres. Russia has one complex in Omsk which produces a bioethanol blend with oil and plant based spirit from raw materials produced by Biokhim, a joint venture between Russia and Ukraine sourcing raw materials from both countries.

Business RT: Anastasia Kostomarova, James Blake