ClimateIntel.com

Kazakhstan’s only significant renewable energy source at present is hydropower, accounting for 3 percent of total energy consumption in 2006.  At a June 2008 meeting of the Foreign Investors’ Council, Kazakh President Nursultan Nazarbayev called on the Kazakh Government to address the need for the development of renewable energy, taking into account the country’s wind and solar resources.  Initiatives proposed by the government have the potential to help certain localities address existing electricity deficits and could provide economic incentives for blending gasoline and diesel with more eco-friendly bio-fuels.  Renewable energy initiatives in Kazakhstan are very modest in scope, however, and the main focus of the country will continue to be on the development of hydrocarbons. 

Hydropower Initiatives

Kazakhstan’s five hydropower plants produce about 12 percent of the country’s electricity, while coal-fired plants account for over 80 percent of electricity generation. The government is planning to construct a number of large and small hydropower stations in the Almaty region.  A major ongoing project is the 300 MW Moinak hydropower station, which is estimated to cost about $300 million, including a $200 million credit from China’s Development Bank. 

Bio-fuel Initiatives

Kazakhstan’s bio-fuel sector is in its infancy, and new legislation in the works will for the first time outline the scope of state regulation of this sector.  The Kazakhstan Bio-Fuels Association was founded only in 2007.  The Ministry of Agriculture is expected to present technical standards in 2009 for gasoline and diesel blended with up to 7 percent bio-fuel.

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Ways to increase energy efficiency, reduce environmental pollution, and produce electricity and fuel from renewable sources are being debated by Russian officials and industry experts.  However, unless a well-developed system linking legal, financial, regulatory, and technological issues is developed, regional authorities will have few incentives to encourage private investment in renewables.

The federal government is now working on a program aimed at increasing installed wind power capacity to 7 GW by 2020 (up from 16.5 MW at the end of 2007, according to the World Wind Energy Association).  One aspect of the program would subsidize much needed construction of transmission lines from wind power facilities, with some new wind farms built in close proximity to traditional power stations to supplement their electricity generation.  In addition to the need for investment in transmission infrastructure, the implementation of wind-power projects in Russia will require resolution of tariff issues, as well as various types of federal support, grid connection requirements for wind power plants, and imports for wind energy equipment.  Russian experts stress that Western experience in the area of renewable energy will require adaptation to Russian realities, including the production of equipment capable of operating during Russian winters.

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Akin Gump Senior International Advisor Toby Gati recently authored an important article discussing the future of Russia’s renewable energy industries.

Russia, currently the world’s number one gas producer and number two oil producer, also has the potential to be a giant in the area of renewable energy. The Russian government has recently signaled support for the introduction of technologies to improve energy efficiency, reduce the adverse impact on the environment, and produce electricity and fuel from renewable sources. The articulation of concrete national goals for the development of renewable energy and the creation of a more solid legal framework, including financial incentives and subsidies, can over time make both domestic and foreign investment in this area more attractive.

Click here to read the article

In an op-ed published in today’s Moscow Times, Akin Gump Senior International Advisor Toby Gati analyzes emerging policy signals indicating an increased interest in renewable energy and energy efficiency projects in Russia.

Mrs. Gati is the former special assistant to President Bill Clinton for Russia and the Eurasian States and Assistant Secretary of State for Intelligence and Research.

The Russian Federation’s carbon emissions are significantly lower than the limit placed on the country under the Kyoto Protocol, leaving Russia with the opportunity to sell a portion of its emissions quota. Under current prices, the total potential value of Russian carbon credits is estimated at around US$40 - US$60 billion. Given these facts, one would expect quite a bit of activity on the part of officials and companies to unlock this potential value - especially since the level of actual carbon credit trading in Russia has been quite low.

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In the Russian Federation, there has been scant attention - if any - to the upcoming UN Climate Meeting. The Russian media and press have been exceedingly focused on the upcoming (December 2, 2007) Russian Duma elections. Nevertheless, the Russian government has paid some attention to climate change issues recently.

President Putin issued a decree on October 21, 2007 entitled “On holding in 2008 in the Russian Federation an International Year of Mother Earth” implementing the UN’s declaration of 2008 as the International Year of Mother Earth.

The Russian Federation’s UN Representative offered the country’s position in the UN climate change debate by statement issued in August of this year. In the Statement, we see two key features that we believe reveal the base of Russia’s position on climate change - (1) the fierce clinging (at least for the near future) to the Kyoto Protocol and (2) a call to avoid creating an apocalyptic mood by dramatizing the issue and instead rely on comprehensive scientific research by leading national and international bodies. (more…)