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bne February 2022 Companies & Markets I 29
bne:Green
Russia's $6.5 trillion decarbonising plan will launch next year
Ben Aris in Berlin
Russia is revving up to launch a four-decade-long, RUB480 trillion ($6.5 trillion) investment campaign to reduce carbon emissions by 60% before 2050 from 2019 levels, of which RUB89 trillion ($1.2 trillion) will come from public funds.
President Vladimir Putin offered an optimistic scenario of Russia’s attempts to reduce its CO2 emissions during his speech at the Russia Calling! Conference on 30 November. The president said Russia could reach carbon neutrality even
Russia is about to launch a 40-year-long campaign to make the country carbon neutral by 2060 that will cost about $1.2 trillion.
Then on July 1 next year Russia will formally launch a massive climate initiative with the goal of reaching carbon neutrality by 2060. A new programme of energy efficiency will also be finalised by October 1, 2022.
After a slow start a string of environmental disasters in
2021 seems to have woken the Kremlin up to the dangers and encouraged it to grasp the nettle. As bne IntelliNews has reported, Russia’s permafrost is melting and could cause over a trillion dollars worth of damage to the Russian economy.
Russia has a relatively good starting point as, featured in the Cost of carbon in Russia, the collapse of the Soviet Union
and the subsequent investment into modern equipment and technology have already seen emission levels fall dramatically over the last three decades. And on top of that, Russia is home to the largest forests in the world. But at the same time, it also hosts some of the most polluted places on the planet and any emissions by Russia are big emissions, as the country is so vast. Russia has a key role to play in the fight to avoid a global warming catastrophe.
The rate of temperature rise in Russia is now triple that of the global average. This summer was plagued by wildfires over territories the size of European countries.
In addition, warming weather led to a power unit belonging to Norilsk Nickel spilling over 20,000 tonnes of oil into Arctic rivers in the Pyasino region in June 2020, which was declared a federal emergency by the Kremlin and cost Norilsk $2bn in fines. Also in June 2020, a once-in-a-1,000 year snow melt flooded the TGK1 power station near Murmansk, putting
two of its hydropower units out of action. A few months
later, in October 2020, an unusual algae bloom off the coast of Kamchatka killed all sea life along several kilometres of coastline. And most recently Russian oil major Lukoil spilled 100 tonnes of oil in the Komi Peninsula, although very little of that got into the local rivers that flow into the Barents Sea.
Costly reductions
Decarbonising Russia is going to be expensive. The effort, so far, has been led by Russia’s leading corporations after some found their shares excluded from Scandinavian pension funds
earlier than the 2060 target if all the goals in the plan are met on time. The country has “a whole set of tools for reducing the economy’s carbon intensity” and a comprehensive roadmap will be ready by March 1, 2022.
The president also promised Russia will develop renewables and hydrogen projects (including green hydrogen), and will benefit from the current large share of low-carbon generation in the mix.
“The country should also use the absorption potential of its forests, fighting forest fires more effectively and growing new forests,” said Putin, highlighting a big part of Russia’s plan to reduce its emissions.
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