Green Energy in Russia

Green Energy in Russia

Green energy is continuing to gain importance in Russia. More and more investments are being attracted in renewable and green energy projects. A state support program for renewable energy has currently been prolonged until 2035. 

The aim of this ambitious program is to increase electricity generation through alternative energy sources. The high growth rate of green energy demonstrates the need for further development in this area, which is why the Russian government decided to approve a plan to extend the program until 2035. 

There are three main types of renewable energy in Russia: solar, wind and hydropower, among which solar power is the most advanced. Due to the rapid development of solar power worldwide as well as in Russia, the costs for its generation have been significantly reduced over the past years. More and more small and medium-sized enterprises are showing interest in less environmentally damaging technologies, which include solar power. Wind power is also gaining more and more attention: about 30% of its economic potential is concentrated in the Far East and is currently used mainly in rural areas. With regard to hydropower, Russia is second only to China in terms of global hydropower reserves: about 80% are in Siberia and the Far East and 20% in the European regions of the country. The first results of the government’s “Renewable Energy Support Programme” show the growing role of green energy. In 2020, after all 40.4% of the electricity generated in Russia came from nuclear and hydropower (including large hydroelectric power plants), while thermal power plants provided in total 53% of the energy production. The share of renewable energy sources, which include wind farms and solar plants, was 0.3%, or 3.36 TWh in electricity generation. Importantly, by 2035, it is planned to produce more than 12 GW of generation capacity based on renewable energy sources, such as wind, sun and small hydroelectric power plants. 

Price advantages through green energy 

Many experts say that if Russia continues to develop green energy projects, green energy could become even cheaper than conventional energy. As the cost of equipment for solar and wind power has decreased significantly, natural sources of energy, such as sun and wind could be among the most affordable energy suppliers in the next few years. 

Therefore, Russia soon plans to launch green certificates in order to confirm that industrial products were created through renewable energy and low-carbon sources, such as nuclear power plants and large hydropower plants. Experts say that these certificates could have a positive impact on consumers and electricity producers. Thus, the use of renewable energy will increase significantly, as many companies will start to meet their energy needs exclusively through it. Following the European Green Deal, the introduction of a Carbon Border Adjustment Mechanism (CBAM) for imports to the EU Member States is planned, which should have positive effects on Russian companies that operate in the European market. Thus, green certificates will be a good opportunity for Russia to involve the use of renewable energy sources and to cooperate with the EU. 

According to the leading state information agency, in the future there will also be a great need for energy technology equipment required for renewable energy production. For example, many large Russian companies are currently trying to reduce carbon production and help maintain a healthy environment. A prominent example is Fortum, a leading producer and supplier of heat and electricity in the Urals and Western Siberia, which cooperates with the Wind Energy Development Fund – a joint investment fund set up on an equal basis by Fortum and RUSNANO. It produces renewable energy equipment that contributes to decarbonisation and helps market leaders implement sustainable development strategies. 

Another leading company in this field is Hevel Energy Group, which supplies photovoltaic modules and solar panels and is also the largest investor in solar parks in Russia and the CIS. But green energy technology could also be a promising area for potential investment. 

In summary, Russia is a good example of the rapid growth of renewable energy and is also a favourable location for international investment in green energy projects – especially in wind, solar and small hydropower plants. LGP Vienna advises and supports potential investors interested in green and renewable energy in Russia with its many years of experience and broad expertise in this field. 


AUTHOR:

Angelina Arkhangelskaia, M.A., graduated in Law from the Russian University of Friendship of Peoples and European Union Studies from Paris Lodron University Salzburg. She has

My documents

Add page

There are currently no documents in your basket.