Russia Kicks Off Largest Wind Tender

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Written by Martin Lynch, European News Editor for Industrial Info (Galway, Ireland)--Russia has launched its largest ever auction for renewable energy, targeting 1,900 megawatts (MW) of wind power capacity.

The country's renewable energy sources (RES) tender will be held in two phases between May 29 and June 9 2017, with the results being announced at the end of June. Fortum Oyj (HEL:FUM1V) (Espoo, Finland) could be in line to win up to 1,400 MW of the projects on offer, following a deal it inked in April with Rusnano, a Russian state-owned development company, to pitch for wind contracts inside Russia. The 50/50 venture gives Fortum a distinct advantage in the upcoming auction, as Russia intends to use domestic companies to deliver much of the wind technology. The joint venture company has bid for most of the wind contacts on offer.

Russian authorities received 450 MW of applications on the first day of the auction according to the Russian Association of Wind Power (RAWI). The tender calls for 250 MW of renewable energy capacity to be commissioned in 2018, 300 MW for 2019, 350 MW for 2020, 500 MW in 2021 and a final 500 MW in 2022. The Russian government wants windfarms to generate about 2% of the country's total electricity by 2024.

Russia's state-owned Rosatom Corporation (Moscow, Russia) recently announced plans to start building turbines for the first time. In February, the company announced a partnership with Dutch company, Lagerwey (Barneweld, Netherlands), a smaller European wind turbine designer, developer and manufacturer, with the goal of developing the production of the wind turbines in Russia.

"Here we speak of the formation of the entirely new industry in Russia", stated the first deputy director general of Rosatom, Kirill Komarov. "Rosatom sees its goal not only in the building of windfarms, but in the development of regulatory system, personnel training system, production localisation, certification and an R&D system for the wind sector. We have experience and knowledge second to none in the creation of new industries from scratch. The basis of the future energy balance is based on low-carbon technologies like nuclear power and renewables combined. The decision to diversify our market proposal in low-carbon energy is part of our overall business development. Moreover, it aligns to the government 2017-2025 strategy aimed at shifting to the sustainable 'green' development model."

Rosatom estimates that by 2024, the generation in the domestic wind energy market will amount to 3.6 gigawatt hours (GWh), with annual turnover of approximately $1.6 billion. The estimated value for wind energy equipment, facilities, maintenance and after-sales services is about $6.3 billion.

According to the International Renewable Energy Agency (IRENA), Russia can increase the share of renewables in its energy mix from roughly 3% today to more than 11% by 2030. However, it will need to accelerate investment, as under its current model the share of renewable energy will reach just 4.9% by 2030. In 2015, renewables accounted for about 20% of its electricity output, but about 18% of that comes from long-established hydropower plants.

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