Page 1

SU M M AR Y

Wind Power Status in Russia and the CIS Countries Regional Wind Power Market and Potential

Armenia Azerbaijan Belarus Georgia Kazakhstan Kyrgyzstan

Moldova Russian federation Tajikistan Turkmenistan Ukraine Uzbekistan

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ISSUE 2 June 2012

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Foreword Imprint

Wind Power Status in the CIS Countries Published by:

World Wind Energy Association WWEA Head Office Charles-de-Gaulle-Str. 5 53113 Bonn Germany Tel: +49-228-369-4080 Fax: +49-228-369-4084 E-mail: secretariat@wwindea.org www.wwindea.org

Editor: Stefan Gsänger Author: Alina Prokopenko Cover: Jean-Daniel Pitteloud Valuable inputs of the following experts are acknowledged and appreciated:  Andriy Konechenkov (Ukraine)  Georgiy Doroshin (Kazakstan)  Pavel Bezrukih (Russian Federation)  Sergey Nikitin (Belarus)  Temur Pkhovelishvili (Georgia)  Tony Nelson (Kyrgyzstan/Tajikistan/United Kingdom)  Viktor Elistratov (Russian Federation)

Acknowledgements by the author: The author of this report expresses her deepest gratitude to all contributors of the given publication: the Secretary General of the World Wind Energy Association and the personnel of the organisation for overall support during the working process, local experts and NGOs from the CIS countries who kindly shared their knowledge, valuable insights and experiences. Special thanks to Andriy Konechenkov, Athanasios Papazoglou, Peter Zhang and Stefan Gsänger for their assistance in reviewing and editing the texts. © WWEA 2012 Duplication, reproduction, translation or distribution of the whole report or its parts requires a prior consent of WWEA. 3


Foreword

Wind Power Status in the CIS Countries

Dear Readers of the CIS Report, The CIS countries are representing a world region with huge wind potentials, but where so far wind energy plays only a marginal role: The total wind installations have only reached 178 MW, a tiny share of the global wind capacity of 254’000 MW (as of June 2012). The reason for this minor share is certainly not a lack of wind potentials, although existing estimations are still very conservative. The main reason lies rather in the current political and economic structures: Only few countries do have comprehensive policies for renewable energy in place. And some countries do have major fossil resources such as coal, oil or gas – which may create the illusion that there is no need to look for alternative options. However, the global debate on climate change, environmental pollution and simple economic considerations are recently leading to an increasing interest in wind power in most of the CIS countries. Ukraine, without doubt, is currently in the pole position, representing by far the largest share of wind power installations, with 151 MW installed. The country has also started to establish a domestic wind turbine industry, in cooperation with international companies. Also without doubt, many more countries in the region do not only have big wind resources, but at the same time the basic industrial capacities that are necessary for manufacturing and hence to make full use of the benefits of wind power utilisation. WWEA has decided to publish this book in order to highlight the huge economic and social potentials and to provide a comprehensive overview of the situation in the CIS countries. We want to contribute with this report to kick-start the deployment of wind technology in the region by providing information and by raising awareness amongst decision-makers from within and outside the region, amongst governments, industry as well as academia – and civil society. May this report contribute to this important objective – and may it be useful for your work!

Stefan Gsänger Secretary General World Wind Energy Association 5


Foreword

Wind Power Status in the CIS Countries

Dear Friends! “Energy independence is a ‘lifeline’ of any nation. The development of renewable energy is an urgent need; only renewable energy sources can ensure a sustainable development!” said the 11th President of India, Dr. Abdul Kalam. Renewable energy development is an irreversible process based on environment-friendly sources of production, reliability and cost effectiveness of “green” technologies. Intensity of the process depends primarily on the politicians’ will to make a decision in favor of creating a secure future independent from fossil fuels. Unfortunately, today it is still too early to speak about largescale deployment of renewable technologies in the economies of the CIS countries, whose governments have so far built their economic prospects on the basis of conventional energies. Meanwhile, it’s worth noting that over the past three years the situation has started to change for better, although very slowly. Many legislative acts aimed at promoting energy-saving technologies and production of electricity and heat from renewable energy sources have already been adopted on the territories of the former USSR. At the same time, the majority of the adopted laws are more declarative in their nature, creating numerous barriers for attracting investments. What can force the political decision-makers to reconsider their approach in favor of local renewable energy resources? In any case, continuously rising natural gas and oil prices will lead to economic turmoil in the countries whose governments do not invest in renewable energy. Legislative support for renewable energy plays a major role in securing not only reliable power supply, but also in preventing the crisis of the economy as a whole. Naturally, changes of the existing situation and general acceptance of the “green” technologies by the population involve, first of all, a national large-scale public awareness campaign, the involvement of business in the development of local renewable energies. Today, renewable energy, and wind energy in particular, stimulates the growth of economic well-being of a nation, increases its energy independence, lowers energy-related expenses, reduces risks associated with the prices for energy carriers, increases competitiveness, facilitates the export of technologies and creates new jobs. Nowadays globally there are more than 5 million jobs in renewable energy. The book on the current status of wind energy sectors in CIS countries by the World Wind Energy Association presents a comprehensive overview of the existing policy and legislative frameworks in the wind energy sectors of these countries. I believe that the publication of this book is very important and timely; it will draw international attention to the new markets with enormous potential for the wind industry. It’s time to take action. A lot of work is waiting for us. Best wishes, Andriy Konechenkov Board Member of WWEA and Representative for CIS Countries Chairman of the Board of Directors, Ukrainian Wind Energy Association (UWEA) Kyiv, November 2012

6


Wind Power Status in the CIS Countries

Contents

Index Foreword.........................................................................................................................................................5 Table of Contents...................................................................................................................................7 I.

Introduction................................................................................................................................9

II.

The Commonwealth of Independent States: An Overview............13

III.

Assessment of Regional Wind Potential.................................................17

IV.

Country Reports................................................................................................................... -

Armenia............................................................................................................................................

-

Azerbaijan......................................................................................................................................

-

Belarus..............................................................................................................................................

-

Georgia..............................................................................................................................................

-

Kazakhstan....................................................................................................................................

-

Kyrgyzstan.....................................................................................................................................

-

Moldova............................................................................................................................................

-

Russia.................................................................................................................................................

-

Tajikistan........................................................................................................................................

-

Turkmenistan..............................................................................................................................

-

Ukraine.............................................................................................................................................

-

Uzbekistan..................................................................................................................................

V.

Analysis: Common Trends, Shared Problems.................................21

VI.

Recommendations: Paving the Way to Sustainable Energy Supply.............................................................................................................................................26

VII. Conclusion..................................................................................................................................31 VIII. References.................................................................................................................................35 7


Acronyms

Wind Power Status in the CIS Countries

Acronyms and Abbreviations ADB – Asian Development Bank BWE – Bundesverband WindEnergie (German Wind Energy Associaion) CHP – Combined Heat and Power (Power Plant) CIS – Community of the Independent States EBRD – European Bank for Reconstruction and Development EU – European Union FIT – feed-in tariff GW – gigawatt (1 GW = 1000 MW) HPP – Hydropower Plant IEA – International Energy Agency IRENA – International Renewable Energy Agency kW – kilowatt (1 kW = 1000 W) kWh – kilowatt hour MW – megawatt (1 MW = 1000 kW) OSCE – Organisation for Security and Cooperation in Europe REEEP - Renewale Energy and Energy Efficiency Partnership REN21 – Renewable Energy Policy Network for the 21st Century RES – renewable energy sources UN – United Nations UNDP - United Nations Development Programme VAT – value added tax W – watt

8


Introduction

Wind Power Status in the CIS Countries

Introduction After the dissolution of the Soviet Union, the history has witnessed a radical change of the political world map and the emergence of a number of newly sovereign states. In the wake of their newfound independence, these countries have been facing an earnest challenge of overcoming an uneasy phase of transition from state planned to market economy. Simultaneously, the conversion of their energy sectors, previously incorporated into a single centralised system, has also become a critical task for the former USSR republics. Whereas the Soviet Union was energy self-sufficient, supplied by its resource-rich regions, the independent countries that appeared after its downfall are now confronted with the situation that they have to secure the domestic energy supply on their own – whether with local energy resources or via imported ones. Considering that the distribution of fossil energy reserves among the ex-Soviet republics is uneven, some of them encountered a severe need to cover the domestic demand purchasing fossil fuels from elsewhere, allocating large expenses for this purpose and accumulating increasing debts. At the same time, the vast regional potential of renewable energy sources (hereinafter – RES), which could be utilised in order to substitute the share of imported hydrocarbons, still remains untapped. Indeed, bearing in mind that energy security of a country is an intrinsic element of statehood integrity and stability, and that it includes vital elements such as independence, invulnerability and sustainability of state energy system, renewable energy could (and should) become an intrinsic strategic component for the countries’ diversification of their national energy supply. Out of the whole scope of available renewable energy sources, wind power deserves a special attention due to its comparative advantages: firstly, it is available everywhere on the planet, secondly, it is relatively cheap and thus commercially competitive, and thirdly, the equipment for wind power generation is easily deployable in almost any location. Of course, the wind resource varies across the countries and regions, but in the light of the regional specific characteristics (geographical location, type of landscapes, level of economic development etc.) it obviously appears as one of the most reasonable options for the analysed states. Moreover, exploiting renewable and wind energy is actually beneficial for both fossil resource-poor and energy self-sufficient countries: the former should opt for it in order to enhance their energy supply security and decrease the dependence on imported fossil fuels, and the latter could save more hydrocarbon reserves e.g. for export. 9


Introduction

Wind Power Status in the CIS Countries

This publication is a unique comprehensive overview of the renewable energy and wind power sector in twelve countries of the former Soviet Union (see the map below): Armenia, Azerbaijan, Belarus, Georgia, Kazakhstan, Kyrgyzstan, Moldova, Russian Federation, Tajikistan, Turkmenistan, Ukraine and Uzbekistan. The report is comprised by separate country chapters and a general analysis of renewable and, more precisely, wind energy status on the territory of the CIS. Figure 1.1

Each country chapter encompasses socio-economic, geographical and political background of a state, as well as the actual data on national energy sector structure and management, provides an assessment of wind power potential, reviews current and planned wind power projects, analyses existing political and legislative environment and the degree of governmental support of RES, and outlines perspectives for the RES and wind power development. Alongside with that, the report contains a general insight into the Commonwealth of the Independent States, analysis of common trends and barriers to wind power development and recommendations for future policies and actions. Furthermore, after each country chapter a listing of useful contacts in the fields of state and governmental agencies, local non-governmental organisations and non-profit associations, research and scientific institutions, business and investment partners can be found. In such a way, a 10


Introduction

Wind Power Status in the CIS Countries

multifaceted review with selective and country-specific data on 12 analysed countries presented in this report can assist the RES industry professionals, investors and prospective developers to shape an understanding of the local and regional markets and project possible business opportunities. The geographical scope of this publication, as follows from the heading, encompasses a vast land area of the Commonwealth of the Independent States (CIS) members stretching from Eastern Europe to Russia’s borders with Alaska and from the Arctic Ocean to Central Asia1. The data used in this report is based on publicly accessible sources, as well as on nonpublic papers and partly on personal expert interviews and assessments. Although the information presented in this report was thoroughly collected and analysed by the author and appeared as the best available at the time, some minor inaccuracies may remain due to the information scarcity and senescence. The given publication is intended to be of a specific significance to a broad group of readers, including renewable energy manufacturers, technology providers, wholesalers, suppliers, project developers, operators, services companies, planning offices, consultancy firms, financing institutions. The report is meant to be also useful for politicians and decisionmakers, as well as for academia, scientists, researches, students, different actors from the public and private sector, NGOs and civil groups. The report might be valuable for both those who are already active in the region or its markets, and for those exploring new possibilities for their business activities.

1 Please note that the term “Commonwealth of Independent States� (CIS) is used in this report in reference to the geographic area, and does not claim to reflect the peculiarities of the membership of each of 12 countries encompassed by the report (i.e. Turkmenistan is unofficially an associate member, Ukraine is a de facto participant, and Georgia, after possessing a full-fledged membership for over a decade has withdrawn itself in 2008).

11


ISSUE 3 September 2012

News Analysis

11


The Commonwealth of Independent States: An Overview


Wind Power Status in the CIS Countries The Commonwealth of Independent States: An Overview The territory of the Commonwealth of Independent States spans over 2,1 million km2 covering 16,4% of the Earth surface with various climatic zones and distinct geomorphic structure. The member countries of the CIS are homelands for 4,4% of world population 272,5 million people of wide range of nationalities and ethnicities. The soil occupied by the CIS countries is immensely rich in natural resources and minerals of all kinds, including energy and renewable energy resources. As much as 20% of world oil deposits, 40% natural gas deposits and 25% of coal reserves are located within the borders of the CIS states with the latter generating 10% of world electricity. At the same time, more than 10 million people in the region are not connected to power grids and suffer from unstable electricity supply provided by the use of expensive and unreliable small gasoline or diesel generators. In comparison with the international standards, the levels of energy use intensity in the CIS remain extremely high, remarkably not only in the energy exporter countries, but also in those deprived of fossil fuels, such as Belarus and Ukraine. Renewable energy potential is also large and diverse, including massive solar, tide, biomass, hydro, geothermal and wind resources, which remain almost untapped at the moment. Even though the level of technically achievable economic potential of renewable energy varies among CIS states, virtually in all CIS countries this RES potential by far exceeds the current energy consumption. The current contribution of RES to total primary energy consumption only comprises 5% in the whole region, out of which 85% is represented by hydropower and biomass. The wind power capacity installed in the whole region represents only less than 0,1% of the world share. The diversity of natural resources in the Commonwealth of the Independent States also applies to their allocation: the member states of the CIS can clearly be divided into fossil fuels rich countries and energy importers. Practically, among the CIS states only Azerbaijan, Kazakhstan, Russia (which have large reserves of both oil and gas) and Turkmenistan (rich in gas) possess – or, rather, produce - sufficient amount of energy locally to satisfy domestic energy needs and even to export the excess abroad. Uzbekistan has significant gas reserves, too, but still imports oil from its neighbours. Besides, Russia and Kazakhstan possess substantial uranium reserves. Out of 12 countries, 4 have nuclear power plants with a joint capacity of around 35 GW. All other states, except for those listed above, to a higher or lower extent depend on primary energy imports; especially grave is the situation in energy-poor countries such as Armenia, Georgia and Moldova. 14


Wind Power Status in the CIS Countries

Table 1.1. Country Data of the CIS Member States Country

Territory, km2

Population

Population Density, per km2

Geographical Position

Armenia

29’743

2’970’495

108

landlocked

Azerbaijan

86’600

9’493’600

109,6

landlocked

Belarus

207’600

9’542’883

46

landlocked

Georgia

69’700

4’570’934

65,6

access to sea

Kazakhstan

2’724’900

15’522’373

6,4

landlocked

Kyrgyzstan

199’951

5’587’443

27,5

landlocked

Moldova

33’851

3’656’843

108

landlocked

Russia

17’098’242

138’739’892

8,4

access to sea

Tajikistan

143’100

7’768’385

54,3

landlocked

Turkmenistan

488’100

5’054’828

10,4

landlocked

Ukraine

603’550

44’854’065

74,3

access to sea

Uzbekistan

447’400

28’394’180

63,5

landlocked

Source: composed by the author.

All countries, with the exception of Moldova, Armenia and Georgia, cover vast land areas (as seen in the table above), thus theoretically having enough land and resources for renewable energy power plants deployment. The prevalent majority of the CIS countries are landlocked, except for Georgia, Russia and Ukraine (Azerbaijan and Kazakhstan only have the access to the Caspian and Aral Sea, both of which are landlocked). In practical terms that means that for Ukraine and Georgia there is a possibility to consider offshore wind farm development on the Black Sea, and Russia could deploy offshore wind farms on many sea spots that it has direct access to. Generally speaking, the countries of the Commonwealth of Independent States represent an enormous territory with diverse nature, landscapes and resources. Practically all kinds of renewable energy can be introduced and utilised in the given region, moreover, the countries themselves would undoubtedly benefit from RES development. The widespread exploitation of renewable energy thus becomes a mere question of time and political will of the countries’ authorities, who should, holding in their hands such a huge potential, direct all their efforts to make a proper use out of it. 15


Assessment of Regional Wind Potential


Wind Power Status in the CIS Countries Assessment of Regional Wind Potential As stated previously, the CIS countries are endowed with significant renewable energy potentials, including rich wind power potential. The wind resources on the post-Soviet space are allocated unequally (see the distribution on the map below), however, each country has enough suitable spots for wind farm deployment. Giants such as Russia and Kazakhstan possess the highest – total and per capita respectively – wind power potential in the world. As seen on the map below, the highest wind speeds are observed on the coastlines of the Arctic and Pacific Oceans, fast winds are also present around the Caucasus and in the mountainous areas. Figure 1.2.

In order to obtain a comprehensive overview of the regional wind power status, it is necessary to look at such important indicators like the installed wind power capacity. The table below summarises the findings of the country chapters and provides an insight into the states’ wind power sector and potential (as assessed for the current moment).

18


Wind Power Status in the CIS Countries Table 1.2. Wind Power and Total Installed Capacity in the CIS Countries Wind Power Installed Capacity

Assessed Wind Power Potential2

Total Installed Capacity

Ukraine

151,1 MW

16’000 MW

53’549 MW

Russia

16,65 MW

90’000 MW

223’971 MW

Belarus

3,5 MW

1’600 MW

8’025 MW

Armenia

2,64 MW

4’900 MW

3’203 MW

Azerbaijan

2,2 MW

3’000 MW

5’798 MW

Kazakhstan

2,2 MW

350’000 MW

19’128 MW

Georgia

10 kW

2’000 MW

4’538 MW

Tajikistan

5,3 kW

1’900 MW

4’426 MW

Kyrgyzstan

2 kW

1’500 MW

3’720 MW

Moldova

0 MW

1’000 MW

1’029 MW

Turkmenistan

0 MW

10’000 MW

3’106 MW

Uzbekistan

0 MW

4’300 MW

12’551 MW

178,31 MW

486,2 GW

343’044 MW

Country

TOTAL:

Source: composed by the author.

The total wind power potential2 of the region, according to the figures above, is estimated at 486,2 GW, whereas only 178,31 MW of wind power capacity is installed – in practical terms that means that only 0,037% of the explored wind potential is exploited. Unfortunately, half of the CIS states have only negligible number of wind turbines in operation, and those generators are prevalently small capacity stand-alone turbines. Another notable peculiarity following from the table above is that the countries with the highest wind potential – such as Kazakhstan, Russia and Turkmenistan – have also large oil and gas reserves, which for a long time have been a significant disincentive to any kind of renewable energy development. Guided by pure logic, one would suppose that among the CIS states the Russian Federation should possess the greatest wind potential just because of the size of its territory, however, according to existing evaluations by local experts, Kazakhstan claims to have richer wind resources. The given fact clearly indicates that the exploration of wind potential within

2 Please note that this data represents the availiable wind potential in a country as estimated by the local experts and studies. The value of real (unassessed) potential shall appear much higher.

19


Wind Power Status in the CIS Countries the countries progresses with a different pace, and those states lagging behind in this regard should continue their scrutiny of available wind potential. Taking a look at the installed wind power capacity it is easy to single out an absolute leader – Ukraine. Not only it has the largest wind power installed capacity, but the whole process of RES and especially wind power development is progressing faster in this country than in the other eleven countries. Ukraine indeed can be considered a front-runner in this regard, which can, and should, stimulate its neighbouring countries’ activities on advancing in the field of renewable energy, fostering healthy competition and inciting a positive breakthrough.

20


Analysis: Common Trends, Shared Problems


Wind Power Status in the CIS Countries Analysis: Common Trends, Shared Problems Even though the CIS countries cover a vast territory of the earth and present twelve states with distinct political configuration, economic development pace and other national peculiarities, they all share one common stratum of history within the borders of the Soviet Union, with each country being a part of uniform centralised system. The given historical fact left its imprint on the modern development progress in these states and endowed them with similar configurations and problems. In this part of the report the trends and findings common for all or for a majority of CIS countries are revealed, alongside with that shared problematic concerns and barriers to RES and wind energy sector development are outlined. Energy Sector. Very often it is the case in the given region that the organisation of the energy sector is represented by vertical, highly integrated and monopolistic structure, fully or to a high extent controlled by the state. Consequently, state owned enterprises receive generous donations from state budget, in reality operating inefficiently and incurring losses. Subsidies given to the conventional energy sector divert funds away from necessary investments in renewable energy, energy efficient equipment, power grid modernisation etc. The lobby of conventional energy representatives in the sector has traditionally been powerful, pushing forward the interests of oil and gas industries. The existing infrastructure is mostly the one left from Soviet times, and therefore often damaged, outdated or worn-out. However, an interesting finding in our view was that the countries that are heavily dependent on energy imports - Armenia, Georgia and Moldova - were actually the first to reform, partly liberalise and privatise, and restructure their energy sectors, eliminating energy underpricing, cross-subsidization, tolerance for payment arrears and huge losses in the energy transmission and distribution systems. Political Environment. Most of the countries have passed through uneasy times after the collapse of the Soviet Union, suffering from intra- and interstate ethnic conflicts, wars and tensions (e.g. issues of Abkhazia and South Ossetia in Georgia, Transnistria in Moldova, dispute over Nagorno Karabakh between Armenia and Azerbaijan etc.). Due to all these events the political environment in most of the CIS states remains unstable, and the political leadership is prone to constant changes. The investment climate in the region cannot be described as attractive either. Regarding the state support to renewable energy, in some countries (such as Moldova, Georgia and Armenia) the officials at the highest political levels declare commitment to RES 22


Wind Power Status in the CIS Countries development, whereas the leaders of other countries do not devote proper attention to this subject, especially those rich on fossil fuels (Russia, Turkmenistan, Uzbekistan). It should be noted here also that Moldova represents a kind of special case with its pro-European orientation and an ultimate goal to join the European Union. Within this course, Moldova is attempting to adjust its policies and legislation to European standards, also in the energy sphere, which is clearly visible from its legislation and statements of the political leaders On the international level most of the countries are moderately active, although the level of their involvement could be increased even more. A number of states receive support from the international organisations and institutions, including UNDP, World Bank, USAID, GIZ, etc. Besides, Armenia, Belarus, Georgia and Moldova have ratified the International Renewable Energy Agency (IRENA) Statute and became its members, Kazakhstan, Kyrgyzstan, Azerbaijan, Tajikistan and Uzbekistan submitted the application for membership, whereas Russia, Turkmenistan and Ukraine remain inactive in this regard. Additionally, all twelve countries except from Russia are participants to EU INOGATE Energy Partnership Programme, which places the increase of energy efficiency and diffusion of RES as one of its main foci. Legislation. Underdeveloped legislative framework coupled with uncertain political and regulatory environment remains a problem in virtually all twelve countries, reducing the investment into local energy sectors. Far not all of the republics have a specific law regulating the renewable energy sector, with other laws covering RES regulation being declarative and fragmentary. In most of the countries Energy Strategies are adopted – comprehensive declarative documents containing the guidelines for energy sector development and setting (often ambitious) targets for the future, including a planned share or quantity of RES installed capacity. A feed-in tariff system is only established in three countries out of twelve: Armenia, Belarus and Ukraine; local content requirements were introduced and underpinned by appropriate legal acts only in Ukraine. The issue of implementation of existing laws and regulations in practical terms also remains problematic. Funding. Inadequate financial support is one of the gravest stumbling blocks of renewable energy sector development in each (with no exception) country of the Commonwealth of the Independent States. The lack of funding is observed from both public and private actors: in case of state funding, it is often an issue that the funds allocated from the budget for renewable energy sector is insufficient to implement the targets of national programmes, not even mentioning a severe lack of funds to repair or replace the worn-out 23


Wind Power Status in the CIS Countries infrastructure. Among local risk-averse businesses and the private sector there is still too little initiatives to invest in renewable energy projects due to poor legislative regulation, long payback periods and general uncertainty. Electricity Prices. In most of the CIS republics the prices for electricity remain low, often artificially low, due to heavy subsidies to conventional energy producers. As it can be seen in the table below, the price varies from 1 to 10 Euro cents per kWh (compare with prices per kWh in Europe: e.g. Spain 18 cents, Germany 24 cents and Denmark 26 cents). Under such circumstances potential investors lose the incentive to enter the energy market, as they may face low and unguaranteed paybacks. Renewable energy producers also act with cautiousness, taking into account that a feed-in tariff system exists only in three out of twelve countries: Armenia, Belarus and Ukraine, and only in the latter the feed-in tariff rate is high enough to cover the associated costs and risks. Table 1.3. Consumer Electricity Prices and Feed-In Tariff Rates in the CIS Countries Country

Price per kWh, EUR

Feed-in Tariff

Armenia

0,04

0,07

Azerbaijan

0,06

---

Belarus

0,02

x1,3 (first 10 years)

Georgia

0,10

---

Kazakhstan

---

Moldova

0,03 0,04 (35 kWh for free) 0,09

Russia

0,06

---

Tajikistan

0,01

---

Turkmenistan

0,03

---

Ukraine

0,05

0,12

Uzbekistan

0,03

---

Kyrgyzstan

-----

Source: composed by the author.

Public awareness. The situation in the analysed countries is often characterised by a low level of public awareness and concerns regarding renewable energy, its advantages and benefits, as well as by the poor public perception of energy saving issues. However, considering the historical background of the countries and relying upon public opinion surveys, the aesthetics of renewable energy power plants (solar panels, wind mills, etc.) do 24


Wind Power Status in the CIS Countries not represent a problem in the given region. The prevalent majority of the informed population would regard such installations as local attraction rather than claiming the distortion of the landscape view. Local Specialists. Generally, the educational base in the countries of the CIS is fairly decent, with low levels of illiteracy among the population and with high level school and university education programmes. Nevertheless, there is a lack of engineers, technicians and experts specialised in the field of renewable energy, including the areas of manufacturing and production, installation, maintenance, and inspection services. Universities, which are mostly funded from state budgets which that are often experiencing a general lack of funding, do not manage to adjust the educational programmes to the needs of modern societal and economic development. Thus, one can observe that virtually all countries of the Commonwealth of Independent States share similar problems and obstacles on their way to a sound renewable energy sector development. Once these barriers are acknowledged and the first steps are made for their elimination, it will signalise a huge leap towards establishing and maintaining sustainable energy supplies and efficient economic development.

25


Recommendations: Paving the Way to Sustainable Energy Supply


Wind Power Status in the CIS Countries Recommendations: Paving the Way to Sustainable Energy Supply Certainly, each of the twelve countries under analysis has its national peculiarities in the way its energy sector is organised and its own problematic issues within the sphere of renewable energy development. However, just as well as there are common trends in the CIS countries’ energy strategies, it is also possible to outline a list of general guidelines and recommendations for all twelve countries which should be followed in order to successfully proceed with RES proliferation. To a different extent, the CIS member states share the similar need of: 

Further Research and Wind Potential Assessment: Accurate, comprehensive and upto-date information about renewable energy resources within a country and its availability are the primary prerequisites for further progress. Scarce and incomplete data on existing wind potential and the absence of wind maps and atlases represent a major obstacle for the development of the wind sector. Therefore, for the CIS states it should be of primary interest to conduct a precise assessment of their wind power potential, to support and fund all research activities in this area and disseminate the findings, approaching an ultimate goal of using all existing renewable energy sources.

Support on Political Level: In order to exercise a successful renewable energy policy, first and foremost it is necessary to officially declare a full commitment to it – starting from the highest political levels. Unfortunately, the enthusiasm of local NGOs and experts alone is not sufficient to give a strong impetus for prospering RES – it is the state and the government institutions that should provide help and support for renewable energy. Such support should be materialised in formulation of a clear, coherent and targeted national energy strategy where renewable energy should occupy an important position, elaboration of country-wide (quantitative) goals and national programmes provided with sufficient funding, creation of a favourable legislative and institutional base.

Improving the Legal and Institutional Framework: The importance of an adequate dedicated policy and predictable and transparent legal and regulatory frameworks for attracting investments in renewable energy and development of this sector can hardly be overestimated. The legislative base should reflect clear and cohesive provisions regulating the affairs in the sector of renewable energy; at best a separate legislative act on renewable energy should be adopted where still absent. The existing laws and 27


Wind Power Status in the CIS Countries regulations should be strictly and effectively implemented in practice, guaranteeing a secure and stable legal environment for investments. Respective institutions and/or committees charged with renewable energy support and regulation should also be set up. 

Creating Fair Market Conditions: The overall situation on the national energy market can strongly influence the proliferation of RES, especially if it does not encourage the entrance of new participants; therefore, favourable market conditions are an inevitable part of RES-friendly policies. The countries should work towards ensuring fair competition in energy markets through opening the markets, guaranteeing a nondiscriminatory third party access to the grid, transparency, elimination of cross-subsidies and gradual liberalisation. An independent energy sector regulator should undoubtedly become a component of a fair energy market.

Granting the Funds: Especially at the initial stage of their development, renewable energy projects may require additional financial support, such as grants from the state, donations from respectively organised renewable energy funds and all kinds of investments, including local and foreign ones. Considering the unstable political situation and controversial international image of some CIS countries, it is extremely important to concentrate on repainting a negative portrait by means of improving investment climate.

Providing Incentives: In order to attract investments to a country, a number of necessary economic incentives should be considered. Speaking of power and renewable energy sector these are: tax privileges and exemptions, custom duties relief, concessional crediting with favourable rates, equitable or priority access to the grid, preferential tariff schemes. Taken altogether, the whole complex of regulations, frameworks and mechanism should assure legal certainty, transparency and accountability.

Feed-in Tariffs: In the whole range of countries of the world feed-in tariffs have proven to be one of the most successful mechanisms of stimulation of renewable energy development, providing a necessary financial incentive and additional certainty for investors and funders. CIS countries should use the “best experience” pattern and adopt the feed-in tariff schemes domestically.

Launching Local Production: In order not to be dependent on imported renewable energy generators and equipment, it seems reasonable to launch local production of wind turbines, solar panels etc. and respective complimentary products, especially considering the broad industrial base that was created during the Soviet times and retained up to 28


Wind Power Status in the CIS Countries now. Thus, manufacturing of such products could be started using the existing machinery industries and factories. Setting up local fabrication could be also beneficial in the sense of creating new jobs and attracting modern technologies and know-how to a country. 

Scale-up: After a number of experimental and demonstrational RES projects in a country has proved to be successful and economically profitable, the best way forward is to proceed with further installations and to scale-up the existing capacity, so that sporadic RES power generators would turn into a growing energy subsector, imposing a significant influence on the national and regional energy sources landscape.

Expanding the Grid Capacity: The CIS countries should take into consideration that, alongside with setting ambitious goals for RES, they should also pay heed to the existent grid capacity within their states. For if all renewable energy projects planned for the future are implemented, the grids may be not be capable of handling the newly added capacity. Hence, expanding and modernising the national grid should be as much a priority, as well as renewable energy proliferation itself.

International and Regional Cooperation: Establishing intraregional and international ties in order to create cooperation mechanisms and jointly coordinate and advance the status of RES development should become a priority of the CIS countries. Political, scientific and technical partnership including joint projects and programmes, academic and professional exchange, common information database, specialised seminars and conferences would contribute to RES development in the region. The countries should both communicate with numerous existing international organisations dealing with renewable energy exploiting best international practices and communicate within the region, whereas the Energy Council of the CIS could play a vital role as a forum for discussions and a coordination committee.

Raising Awareness: The more wide-spread the knowledge about renewable energy and its favourable impact on the environment is among political decision-makers, business representatives, specialists and local population, the greater is the impetus for RES sector development. Thus, the measures should be taken to develop a positive image and augment the public awareness of renewable energy advantages and benefits among different societal groups. Such proliferation of information would broaden the horizons of the population and stimulate the demand for RES.

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Wind Power Status in the CIS Countries 

Adjusting Educational System: preparing and training professional personnel and specialists in the field of renewable energy is an intrinsic part of RES development strategy. The authorities of the countries should pay attention to arrangement of relevant educational programmes with deep professional insights into the implications of RES exploration and use.

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Conclusion


Wind Power Status in the CIS Countries Conclusion The advantages of renewable energy have already been recognized all over the world, and increasing their percentage in the total energy mix alongside with moving towards a less carbon-intensive economy has become a popular target per se. Nevertheless, in most of the post-Soviet countries the development of RES sector and efforts to increase energy efficiency still remain in the initial stage, especially in those countries that are generously endowed with fossil fuel resources. Moreover, as one can conclude from the country chapters presented in this report, the progress of the wind power sector is unequal in the CIS states, with Ukraine being an absolute leader in this regard, and Georgia, Tajikistan, Kyrgyzstan, Moldova and Turkmenistan having no installed industrial scale wind power capacity at all. The vast territory occupied by the countries of the Commonwealth of Independent States has immense potential of renewable energy of all kinds, including rich wind resources. Nevertheless, it remains practically untapped, and the degree of their utilisation is negligibly low – less than 5%. According to some assessments, the share of RES in total consumption on the territory of the CIS may grow up to modest 15,6% by 2030 – or even much more, given the right policies are in place. For reaching such targets, the countries will have to demonstrate a strong political will and loyal commitment to the strategy of incremental proliferation of renewable energy, to acknowledge their benefits and to finally overcome the monopolism of conventional energy sources. Furthermore, the countries of the region should grasp the opportunity to establish interregional cooperation on renewable energy promotion and benefit from cross-country exchange of information and experience, they should use best practices and implement joint projects. Besides, the Commonwealth of Independent States, being a regional international organisation by itself, represents a fairly suitable platform for such cooperation. Summing it up, we should note that it is realistic to expect that it will take some time until wind power will acquire a major share in many of the CIS countries, mainly due to political challenges. However, it should become an intrinsic and a growing component of it in the nearest future. Even more, it appears feasible if we take into account that there is also a large area for wind energy applications. Namely the energy supply of the rural areas in each of the twelve analysed countries represents a problematic issue for the national governments. The installation of wind turbines (surely, apart from the general option of large-scale, gridconnected wind farms) in remote population centres would eliminate this problem and 32


Wind Power Status in the CIS Countries contribute to more general concerns of rural energy supply, reducing poverty, creating new jobs, and advancing socio-economic development. All this said, we can claim with a firm assurance: There is a future for wind power in the geographical region of the Commonwealth of Independent States, both for the countries with poor hydrocarbon deposits as well as for the republics endowed with rich oil and gas reserves. It is in the countries’ own responsibility to control and advance the pace of RES and wind power sector development. And only in case that the so far sporadic wind power installations and successful single wind projects become mainstream, the countries and their population will be able to benefit from a large, diverse and untapped potential and make an important step forward towards enhancing energy security and contributing to the global protection of the environment.

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Appendix

Wind Power Status in the CIS Countries List of Tables and Figures

Figures: Figure 1.1. Map of the Commonwealth of Independent States Figure 1.2. Annual Wind Speed Allocation in the CIS Countries at 100 m Figure 2.1. Wind Map of Armenia at 80 m Figure 2.2. Map of Areas with Highest Wind Potential in Armenia Figure 2.3. Location of “Lori-1” Wind Farm in Armenia Figure 2.4. “Lori-1” Wind Farm Figure 3.1. Wind Map of Azerbaijan at 8 0m Figure 4.1. Average Annual Wind Speed in Belarus at 10 m, m/s Figure 4.2. Wind Map of Belarus at 80 m Figure 5.1. Wind Map of Georgia at 80 m Figure 5.2. Potential Wind Farms in Georgia Figure 6.1. Wind Speed in Selected Locations of Kazakhstan Figure 6.2. Wind Map of Kazakhstan at 80 m Figure 6.3. 30 kW Wind Turbines in Almaty Region. Kazakhstan Figure 7.1. Wind Map of Kyrgyzstan at 80 m Figure 8.1. Wind Map of Moldova at 80 m Figure 9.1. Average Wind Speed at 50 m in the Russian Federation Figure 9.2. Location of Existing and Planned Wind Power Plants in Russia Figure 9.3. Barriers to RES Development in Russia Figure 10.1. Wind Map of Tajikistan at 80 m Figure 10.2. Wind Turbine at Poymazor Cellular Power Station, Tajikistan Figure 11.1. Wind Map of Turkmenistan at 80 m Figure 12.1. Wind Map of Ukraine at 80 m Figure 12.2. Novoazovskaya Wind Farm, Donetsk Region, Ukraine Figure 12.3. Ochakovskiy Wind Park, Mikolaiv Region, Ukraine Figure 12.4. Small Wind Turbines at Tendrovskaya Kosa, Ukraine Figure 12.5. Small Wind Turbine (0,75 kW) in Ukraine Figure 13.1. Gross Potential of Wind Energy in the Regions of Uzbekistan Figure 13.2. Technical Potential of Wind Energy in the Regions of Uzbekistan Figure 13.3. Wind Map of Uzbekistan at 80 m

Tables: Table 1.1. Country Data of the CIS Member States Table 1.2. Wind Power and Total Installed Capacity in the CIS Countries Table 1.3. Consumer Electricity Prices and Feed-In Tariff Rates in the CIS Countries Table 2.1. Energy Sector Legislation of Armenia Table 4.1. Energy Sector Legislation of Belarus Table 5.1. Wind Zone Types and Areas in Georgia Table 6.1. Installed Small and Experimental Wind Turbines in Kazakhstan. Table 9.1. Energy Sector Legislation of the Russian Federation Table 9.2. Existing Wind Farms in the Russian Federation 34


References

Wind Power Status in the CIS Countries

Table 9.3. Major Designed and Planned Wind Farms in the Russian Federation Table 12.1. Installed Wind Power Capacity of Ukraine

References: 

Deutsche Gesellschaft für Internationale Zusammenarbeit/GIZ (2009): Renewable Energies in Central Asia. Regional Report on Potentials and Markets – 8 Country Analyses.

Renewable Energy and Energy Efficiency Partnership/REEEP (2007): Renewable Energy: From Exotic to Common Practice. CIS Overview Brochure.

United Nations Development Programme/UNDP (2011): Renewable Energy in Europe and CIS: Results and Lessons Learnt from UNDP Portfolio. Marina Olshanskaya. Astana, Kazakhstan.

Institute of Renewable Energy (2008): Renewable Energy in the CIS Countries. Stepan Kudrya. Kiev, Ukraine.

United Nations Economic Commission for Europe/ECE (2011): Renewable Energy Development in the Russian Federation and the CIS countries. Secretariat Report. Geneva, Switzerland.

Interstate Statistical Committee of the Commonwealth of Independent States (2011): Main Macroeconomic Indicators of the CIS Countries.

European Commission (2008): The Economic Aspects of the Energy Sector in CIS Countries. Centre for Social and Economic Research. European Economy: Economic Papers.

United Nations Economic Commission for Europe/ECE (2001): Energy Efficiency and Energy Security in the Commonwealth of Independent States. ECE Energy Series No. 17. New York and Geneva.

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Summary - Rusia and CIS report  

summary of the report

Summary - Rusia and CIS report  

summary of the report

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