News & Analysis

Russia has the world’s largest natural gas reserves, the second-largest coal reserves and seventh-largest oil reserves. It is the largest exporter of natural gas and since 2009 has periodically overtaken Saudi Arabia as the world’s largest oil producer. It currently supplies around 30% of the oil and 25% of the gas that the EU consumes, and is also a significant global force in the nuclear power industry.

Russia is, after the US, China and Japan, the world’s fourth-largest electricity producer. Russia is a net exporter of electric energy, but unlike in other energy commodities, electricity exports are not at all important for the system as a whole.

Thermal generation accounts for a very high proportion of total electricity generation in Russia. Over 60% of electricity is generated in thermal power plants, with hydro-electric and nuclear power making up the rest. All this fossil fuels comfort makes the Russian Government reluctant to pay attention to renewable sector development and solar and wind sectors. However, the picture started to change at the end of 2012. Russia’s aim is for renewables to supply 2.5% of power by 2020, up from 0.8% now. In May, Russia announced a target of reaching 6.2 gigawatts of renewable vitality capacity by 2020 (excluding massive hydro).

The Russian Federation has excellent potential for wind power generation. An attempt to utilize just 25% of its total potential would yield some 175,000 MW of power. The highest wind energy potential is concentrated along seacoasts, in the steppes’ vast territories, and the mountains. Russia has a total theoretical potential of 2,213 TWh/yr for solar energy, with an economically feasible amount of 101 TWh. The southern parts of Russia, especially the North Caucasus, have the greatest potential for solar energy.

Russia has organized its first state government auction, which given support for renewable energy. Subsidies will receive 39 renewable energy projects with a total capacity of 504 MW. Solar projects won 399 MW of this quota, while the wind power sector won less than 100 MW. In the 2nd auction in 2014, 1,645 MW of wind, 496 MW of solar and 415 MW of modest hydro will be open for bids.

Our forecast for 2013 and 2014 for wind and solar sectors in Russia is moderate positive. We expect first solar PV projects with capacity above 3 MWp and wind project with a capacity above 15 MW to start operation. However, they would play more “testing the ground” role. More information about these promising market you may read here: CIS Countries Solar and Wind Market Outlooks 2013 – 2018