Green energy in Russia may soon become cheaper than conventional energy

Extension of the program to support the development of renewable energy until 2035 will lead to the fact that green electricity in Russia will become cheaper than electricity from traditional sources. This is stated in a study conducted by Vygon Consulting.

Power plants based on renewable energy sources (RES) are being built in Russia under Return on Investment Power Supply Agreements (PSAs). According to the first program, by 2024, about 5.5 gigawatts of green capacity will be built. The government is now discussing the parameters of a new program until 2035. In particular, we are talking about increasing the requirements for the localization of production of equipment and the introduction of requirements for its export.

According to the new program, it is possible to build another 6.9 – 9 gigawatts of green capacity, Vygon Consulting experts say. As a result, the share of renewable energy in the total electricity generation in Russia will grow to 2.9-3.3%.

The first program stimulated the creation of enterprises for the production of equipment, the extension of which will provide an inflow of up to 50 billion rubles. New investment, which will increase the demand for equipment and services. As a result, the volume of specified capital investments in the construction of the new generation will decrease by 30-45% by 2030, says Nikolai Pozybanko, head of energy market regulation at Vygon Consulting. As a result, in new projects, the cost of RES electricity will be lower than that of conventional power plants. Thus, in 2020, the average price of electricity from new solar power plants was 9.5 rubles / kWh, wind power plants – 6.3 rubles / kWh, nuclear power plants – 5.1 rubles / kWh, new combined cycle plants – 3.6 rubles / kWh. By 2030, the price of electricity from wind power plants will drop to 5.2 rubles / kWh, solar – to 7.5 rubles / kWh, while at nuclear power plants it will rise to 7.5 rubles. / kWh, at combined cycle plants – up to 5.3 rubles / kWh, says the expert. He added that when compared to some operating power units of thermal power plants, the difference could be dozens of times in favor of renewable energy sources.

Over the past 10 years, the cost of equipment for solar and wind power plants has decreased by 60 and 40%, respectively, and their efficiency and reliability are increasing, says Alexey Zhikarev, director of the Association for the Development of Renewable Energy (ARVE): Until recently, the efficiency of solar panels was lower From 15%, it now exceeds 20%. The capital costs identified in new Russian solar projects at the global level, having decreased by more than 2.5 times since the start of the program, are invested in the construction of solar power plants and solar panels, said Igor Shkhrai, CEO of the company. Manufacturer Hevel Group, at a press conference at TASS May 22. Electricity from wind farms is almost equal in price to new coal generation and is cheaper than a number of inefficient gas-fired power plants, says Alisher Kalanov, head of investment at Rosnano Management: “The second industry support program for the 2025-2035 company. Government approved minimum volumes that will allow the development of current industrial competencies in high-tech power engineering, which have export potential.” Zhikharev believes that in the next ten years, wind and sun will become the most affordable sources of energy.

The investment in the second program would cost the wholesale market an additional 2.1% in the final price of electricity in the first price zone and 1.1% per second at its peak in 2035, Vygon Consulting calculates. “But there is also the opposite effect: the commissioning of renewable energy generation will reduce the “exorbitant” supply of the price in the wholesale market, which will lead to a decrease in prices in the next day market (DAM) by an average of 1.1-1.6% and saving consumers up to 17 billion rubles per year , and in total – up to 300 billion rubles. By 2035, Posypanko determined. In general, the implementation of the second program will ensure the growth of GDP by 1.3 trillion rubles, and reduce greenhouse gas emissions by 0.5%, the study says.

Valery Dzyubenko, Deputy Director of the Energy Consumers Society, believes that the price reduction in the narrow part of the DAM does not justify large-scale payments for RES capacity that ensures electricity generation due to its dependence on meteorology. “With such huge costs, both in renewable energy and in other industries, more convincing effects can be obtained, from the economy to the environment,” he says.

The cost of a green kWh is getting cheaper due to the rapid development of technology: since 2009, the price of solar panels in the world has fallen by 80%, and “windmill” turbines by 30-40%, so far the average cost of electricity from renewable sources is comparable to generation based on fossil fuels, and by 2030 it could fall another 58% for solar panels and 25% for wind farms, says Dmitriy Stabran, director of strategy and operational efficiency at PwC. He noted that it is difficult to talk about comparing the cost of green and traditional energy existing in Russia by 2030, given the cost of localizing renewable energy sources and the dependence of conventional generation on fuel prices.

Denis Krasnovsky, senior analyst at ACRA, sees it as unrealistic to reduce the cost of green energy to a level below the traditional level in the next 15 years: “In addition to the renewable energy facilities themselves, in order to meet the localization requirements, investors are forced to set up production facilities new renewable energy components”. This will require new capital expenditures, and the RES-2 CSA will have to pay 1 kWh not only to the generation facility itself, but to establish component production, he says: “If RES-2 CSA projects lack the possibility to compensate for such costs, they simply It will not matter to investors.”

Krasnovsky believes that the operation of renewable energy facilities will have a minimal impact on prices in the wholesale market, since the 5 gigawatts of renewable energy generation, which the Department of Energy plans to introduce, is a negligible amount, only about 2% of installed capacity. capacity of the entire power system. With the current pricing mechanism, the cost to the end consumer is likely to increase, Stubran believes. But for retail generation, renewable energy can become attractive, given the speed of construction of renewable power plants and proximity to the consumer.

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