Decarbonization of Russian real economy

Ivan Zhidkikh
Member of RSPP Committee on Climate Policy and Carbon Regulation
Head of special projects and sustainable development department MCC EuroChem

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00:00:00 RSPP
00:01:09 Carbon emission real sector measures
00:04:25 Russian companies competitive advantage
00:05:48 Further plans
00:08:18 Risks and opportunities for climate agenda
00:11:37 Climate projects potential in Russia
00:14:25 CBAM
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The Institute of Economic Forecasting of the Russian Academy of Sciences (IEF RAS) specializes in fundamental, applied and exploratory scientific research in the field of analysis and forecasting of the socio-economic prospects of Russia and its regions, and the development of recommendations and proposals with a goal to improve the quality of economic policy in Russia.

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Notes:

Decarbonization is a priority for Russian business

RSPP is the largest business association in Russia, uniting thousands of the largest Russian companies -representatives of industrial, scientific, financial and commercial organizations in all regions of Russia.

- Climate issues have been in the focus of attention of RSPP and its members since this agenda was brought up.
- In 2020, RSPP set up a Committee on Climate Policy and Carbon Regulation to address relevant climate issues.

Many activities have been implemented since 1990 to help reduce greenhouse gas emissions

Case studies

►Energy efficiency improvement (including cogeneration)
►Reducing the share of oil products and coal in fuel mix
►Construction of hydro and nuclear power plants
►Power generation modernization (capacity supply agreements)
►Increase in the share of processed APG
►Reducing methane emissions
►Decommissioning of open-hearth furnaces
►Increasing the efficiency of coke usage
►Implementing DRI technology
►Increasing fuel efficiency of passenger cars
►Implementation of measures to combat traffic jams in cities

$380 bn were invested in GHG emissions reduction measures in Russia from 1990 to 2017, of these:
►$ 102 bn–increasing energy efficiency of equipment and production, expansion of cogeneration
► $ 40 bn–decommissioning of open-hearth furnaces
► $ 36 bn–construction of hydro and nuclear power plants
► $12 bn–increase in the share of processed APG

These measures made Russia an absolute world leader in reducing greenhouse gas emissions (48% reduction by 2018)

Structural features and the implementation of targeted measures allow Russian companies to be in an advantageous position relative to competitors from other countries

Recent years saw attempts to neutralize the competitive advantages of Russian companies, incl. with the help of such artificial and non-transparent tools as proposed EU CBAM

Many activities are already planned for the period up to 2030 to help reduce greenhouse gas emissions

By 2030, the Russian Federation will remain one of the world leaders in reducing emissions relative to 1990 levels, even with growing production volumes

The development of the climate agenda brings both opportunities and risks for the real sector of the economy

Opportunities

o Participation in global trade of GHG emission reduction units (results of
climate projects - under the mechanisms of Article 6 of the Paris Agreement)
o Gaining new market niches through competitive advantages associated with the low carbon intensity of Russian goods
o Development of energy efficient and digital technologies

Risks

o Reduced demand for certain carbon-intensive products
o Possible expenses under European Carbon Border Adjustment Mechanism (СВАМ)
o Growth in tariffs for heat and electricity, other housing and communal services, transportation, etc. for all types of consumers in Russia in case of application of restrictive mechanisms of climate policy

[inp-ran]

00:00:00​ RSPP
00:01:09​ Carbon emission real sector measures
00:04:25​ Russian companies competitive advantage
00:05:48​ Further plans
00:08:18​ Risks and opportunities for climate agenda
00:11:37​ Climate projects potential in Russia
00:14:25​ CBAM