Green energy awaits state impulse
The second Green Business Lunch in the frame of EcoLounge project took place at Baker&McKenzie premises (a law firm, Moscow office) on 11 December 2009. During the meeting perspectives of using RER (renewable energy resources) in Russia were discussed .
Green Business Lunch is a type of a meeting for experts in energy efficiency and climate change, authorities, business leaders, NGOs and leading consulting companies. Such lunches coincide with the UN conference on climate change in Copenhagen (KC15).
Oleg Popel the Head of Renewable energy resources and energy conservation Laboratory at United institute of high altitude RAN has stressed the huge RER usage capacity in Russia. Nowadays RER (hydro-, wind and sun energy) generate annually not more than 8,5 billions kWh which makes <1% of the total energy production in Russia. The Russian Government order dated 8.01.2009 №1-p stipulated that by 2020 renewable energy sources should reach 4.5% of the countrie’s energy balance. As Oleg Popel says the centralized energy save-up covers only 1\3 of the country’s area and growing prices on heating and electricity make RER economically efficient in the remote regions.
But the lack of legislative base hinders RER progress. On 23 November 2009 the Russian President signed Federal Law № 261 "Upon energy save-up and increasing energy efficiency" which lays the foundations for the state regulations in this area. Russian energy strategy until 2030 was authorized by the Russian Government order on 13 November 2009 №1715-р. Unfortunately, as RAWI vice-president Anatoly Kopylov concluded, RER theme was not covered by these legal acts. But due to the experts, all developed countries where now RER is developing with rapid speed have gone through skepticism era. The aim of Russian energy community is to talk as loud and often as possible about economic, environmental and other RER benefits. "We should take the current situation in the industry as the low point start-up and work on changing the society and state relations with RER" – said Anatoly Kopylov.
What awaits state business in this area? First of all, the market price premium over RER power will be set as well as the order of reimbursing small grid connection expenses by budget funds (up to 25 MW). Thereat as NTC Atmograph General Director Vladimir Nikolaev says, the premium rate which is currently prescribed by Minenergo project, will not be able to give any real impulse for RER development. “Until there are economic benefits for investing in RER, renewable energy will remain a hobby for large-scale business” - repinded Vladimir Stanev from LUKOIL. “Russia has neither state policy in part of RER support nor tax premium for the industry development” - added Vladimir Vasilevich from NITOL (the company produces polysillicon – raw material for plates for solar elements) – therefore export is our strategy.
RAWI vice-president Georgiy Ermolenko thinks that besides legislative regulation, RER development could be withholded by the internal industry which currently is not ready for large-scale manufacture of big generators, electronics etc. Thereat there are examples where RER benefits are clear. Like even now to heat up a multy-familiy house in Podmoskovie it is sometimes more beneficial to set up a boiler on pellets (wood processing products) in the cellar than get connected to the central heating system.
Max Gutbrod - a partner of Baker & McKenzie - reminded, that all around the world the main green energy projects’ customers are municipal authorities therefore industry regulation should be bounded with changes in Housing and Public utility sectior.
“In Russia the companies that wisely invest in their future are involved in renewable energy in particular wind power” - noted Igor Bryzgunov RAWI president. Today prior to any state support the RER project payback is 14 years on average. But apart of all difficulties and the main withholding factor – lack of tariff premium, RER market exists in Russia. Right now 6 companies invest their money, efforts and resources into wind power projects development. During the next 5 years they have planned to launch wind parks with total capacity about 6 000 MW. Due to Igor Bryzgunov this shows that players interest in the market precedes events. When the premium is authorized, a boosting market growth could be expected which is grounded not only by the industry investors’ interests but by the investors departing other markets – the ones that prior to crises were brining high profits.
EcoLounge project is a community of experts and enthusiasts concerned about Russian environment and sustainable development. The project established in the frame of popular international concept Green Drinks carries monthly meetings about environment, energy and efficiency as well as actively partakes in different eco-projects. The project has a webpage - ecolounge.ru and posts econews on greeen.ru
Baker & McKenzie is an international law firm with 67 offices in 39 countries around the world. Their Moscow office has been operating since 1989. In 2009 the guide Chambers Europe called Baker & McKenzie the best law firm of the year in Russia. Since 2004 Baker & McKenzie has been consulting leading Russian and foreign companies as well as Russian and foreign state bodies in part of climate change and energy efficiency.
