Market News

 August 25, 2009
Russian Renewable Energy Ready For Bigger Slice of Power Pie

 GLOBE-Net - 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.

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."

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.

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.

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.

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.

Water     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.

Wind     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.

Solar 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.

Geothermal     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.

Biofuel     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.

For More Information: Russia Today