Turnover of Renewable Energy Markets is Estimated at RUB 2.7 trln by 2035

12 December 2019

Alisher Kalanov, Head of Investment Division RES of RUSNANO Management Company, took part in the 8th Annual Conference The Future of Renewable Energy in Russia organized by the Vedomosti newspaper. Two sessions devoted to the current state of the RES industry and the prospects for localization of equipment were also attended by representatives of the Ministry of Energy of the Russian Federation, Ministry of Economic Development of the Russian Federation, Ministry of Industry and Trade of the Russian Federation, infrastructure organizations, investors in projects for the construction of RES generation and localization of equipment production.

Turnover of renewable energy markets is estimated at RUB 2.7 trln by 2035.

The speakers agreed that the development of the renewable energy sector is in line with the government's goals of creating a new knowledge-intensive economic industry and increasing Russia's high-tech exports. It is also relevant for the implementation of the objectives of the Russian climate agenda.

Alisher Kalanov spoke about the results of the RES stimulation program for the period up to 2024 and outlined the prospects of the industry development up to 2035. “The first 5.4 GW RES Energy Supply Contracts (ESC) program predetermined the appearance of the industry: a large industrial cluster with prospects for export markets and potential for Russian R&D has been created,” believes the Head of Investment Division RES of RUSNANO Management Company. “The task of the second program of the RES ESC up to 2035 is to strengthen the established competencies in the field of solar and wind energy, increase the competitiveness of the Russian RES industry in the domestic and foreign markets and ensure the export of high-tech products and services. The parameters of the RES support program adopted by the Russian Government for the period of 2025-2035 make it possible to build another 7-9 GW of RES capacity on the wholesale market.”

In addition to the wholesale RES market, Alisher Kalanov predicts the development of retail market, markets for isolated power systems and microgeneration as the support measures are improved. “According to our conservative estimate, by 2035, the potential of these markets is estimated at up to 10 GW in addition to wholesale generation. Thus, the minimum industry volume will reach 25 GW by 2035. The total turnover of all existing markets of the renewable energy industry on this horizon is estimated at RUB 2.7 trln,” he said. According to him, the renewable energy industry creates a large investment demand for both the engineering sector and manufacturers of base materials, as well as for services of engineering, logistics, leasing, insurance and financial organizations. The emergence of up to 15 thousand new jobs will create demand for highly qualified staff and require new educational programs. And the increase in the share of RES in the energy balance will stimulate the development and introduction of advanced digital technologies in the power industry. These factors in aggregate will create a significant positive impact of the RES sector on the Russian GDP growth, says the manager of RUSNANO Management Company.

At the next stage of support, investors in equipment localization projects will master new renewable energy technologies, Alisher Kalanov expects. “The players will think about increasing the efficiency of solar modules, the size of wind turbines for the wholesale market, the introduction of new materials and deepening the localization of equipment produced. Solar power generation solutions over 5 MW, which have a low rated cost of electricity generation (LCOE) and prospects for export, will have a competitive advantage,” he said. At the same time there will be multi-megawatt solutions for offshore wind turbines (marine type), which are already widely used in the world, as well as effective wind turbines of average capacity (about 1 MW) for the retail market.

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RUSNANO Joint-Stock Company was founded in March 2011 through reorganization of state corporation Russian Corporation of Nanotechnologies. JSC RUSNANO contributes to implementation of the state policy on the development of the nanotechnology industry by investing directly and through investment funds of nanotechnology in financially effective high-technology projects providing the development of new production facilities in the Russian Federation. Its primary investment focus is in electronics, optoelectronics and telecommunications, healthcare and biotechnology, metallurgy and metalwork, energy, mechanical engineering and instrument making, construction and industrial materials, chemicals and petrochemicals. 100 percent of RUSNANO’s shares are state owned. Thanks to RUSNANO’s investments, there are currently 126 factories and R&D Centers opened in 38 regions in Russia.

Management of assets of RUSNANO JSC is carried out by Limited Liability Company established in December 2013, RUSNANO Management Company.

Work to establish nanotechnology infrastructure and carry out educational programs is fulfilled by RUSNANO’s Fund for Infrastructure and Educational Programs, which was also established during the reorganization of the Russian Corporation of Nanotechnologies.