Renewables in Russia: From Opportunity to Reality by Organisation for Economic Co-Operation and Development

By Organisation for Economic Co-Operation and Development

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Notes: 0 is negligible, - is nil 1. Includes lignite and peat. 2. Comprises solid biomass, biogas, industrial and municipal waste. Data are based on partial surveys. 3. Total supply of electricity represents net trade. A negative number indicates that exports are greater than imports. * For a more detailed discussion of the Russian energy sector see IEA/OECD Russia Energy Survey, Paris 2002. 62. The fact that the energy sector was state-controlled in Soviet times has left a legacy of inefficiency and distorted prices.

Subsidies and cross-subsidies are common. When the cost of using renewable energy resources is compared with the cost of conventional energy sources in this environment, it is not surprising that renewable energy is viewed unfavourably. Energy Pricing and Accession to the WTO Artificially low domestic energy prices have been one of the most debated questions in the negotiations of Russia’s entry into the World Trade Organisation. The gap between domestic and export prices is seen as an implicit subsidy for Russian manufacturers, which gives them an advantage over their foreign competitors.

Nuclear power generation currently accounts for over 15% of overall domestic generation. Figure 9 illustrates how the Russian electricity sector is organised and regulated. The Russian government, through the authority of the Federal Energy Commission, sets the maximum level of electricity tariffs to different groups of consumers (industrial or residential), while the regional energy commissions (REC) regulate electricity retail tariffs in the regions, based on these set maximums. Although formally independent, in practice the regional energy commissions tend to be closely connected to the regional governments.

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