The Russian government’s recent initiatives to develop renewable energy supplies should come as a further boost for the industry. A report from the International Energy Agency (IEA) suggests that the country has great prospects in the years that lay ahead. For example,
“It is estimated that Russia’s renewable energy potential could provide as much as 30 per cent of total potential energy supply (TPES). In terms of biomass fuel, forests cover 40 per cent of the entire landmass, and account for nearly a quarter of the world’s forests. Although the forestry industry is important to the Russian economy, and it is a large potential supplier and consumer of biomass, these resources are, so far, only being minimally exploited.” (Power Economics, 2003)
Similarly, with Russia having plenty of rivers, Hydro power provides enormous opportunities for the energy industry in the country. As with the biomass fuel, hydro power is yet to be tapped into. In many ways this is still a nascent industry in Russia with tremendous growth potential. The IEA report further points out that this energy source could provide nearly 10 percent of the total energy needs for the country. On top of that, plans have been charted out to explore Wind energy. This again offers huge opportunities for the country, especially since the “Pacific and Arctic coasts, as well as those of the Caspian, Baltic, Azov and Black Seas, and the high plains and mountain regions” are ideally suited for wind-mills. Nearly 37 per cent of the country’s wind resources are found in European Russia, and nearly sixty percent in the upper reaches of the country (especially Siberia). The Far East is the other region being considered for wind mill projects. With population being very low in these regions, conditions must be perfect for the setting up of Wind energy plants. The following table illustrates the future potential of these renewable energy sources, which could strengthen Russia’s position in the global energy market (Power Economics, 2003).
Table 1: Potential of Renewable Energy Sources in Russia *
Resource Gross Technical Economic
potential potential potential
Small Hydropower 360.4 124.6 65.2
Geothermal Energy * * *
Biomass Energy 10x10 53 35
Wind Energy 26x10 2000 10.0
Solar Energy 2.3x10 2300 12.5
Low Potential Heat 525 115 36
Total Renewable 2.34x10 4593.0 273.5
Energy Source
* (million tonnes of coal equivalent) (Power Economics, 2003)
It is accepted that there are potential dangers associated with the rising dominance of Russia in the energy market, but there are other positive aspects as well. For one thing, Russian ascendancy will neutralize the clout held so far by Saudi Arabia and Venezuela in setting global oil prices. But, with the introduction of Russia and China into leadership positions in the energy market, tougher competition will persist, which will ultimately benefit the consumers across the world (The Economist (US), 2006). In other words,
“The oil market is tight, but price is a wondrous mechanism, and rising prices have spurred investment. Though high prices may persist for several more years, the danger of disruption will recede. With oil, as Mr. Chavez well knows for all his huffing and puffing, aiming this “weapon” is especially difficult, since oil, unlike gas, can be loaded on tankers and sold into a single world market. As ever, the Middle East is volatile. China’s growth is sucking in energy. In 2003 it overtook Japan to become the world’s second-biggest consumer of oil after America. Energy security therefore plays a growing part in China’s foreign policy.” (The Economist (US), 2006)