Vice-Prime Minister of the Russian Federation
This year, the Russian electric power industry is celebrating a landmark event – the 100th anniversary of the adoption of the State Electrification Plan (GOELRO), which has become a defining document for the industry for many decades to come. In those challenging years, our fellow specialists in energetics laid a solid foundation for the creation and successful development of the power grid complex in Russia, which is now one of the largest and most modern in the world. To date, access to electricity has been provided throughout the entire country, which is essential not only to ensure comfort for the citizens, but also to successfully develop the industry, and therefore the economy as a whole. At the same time, the electric power industry constantly improves, introduces innovative and breakthrough solutions that allow increasing the reliability and quality of energy supply to consumers day after day.
History of GOELRO
By 1913, the Russian Empire generated more than 18 times less energy per capita than the then-recognized leader in this indicator – the United States. The case is that all the stations under construction were designed literally for one to several dozen consumers and were not interconnected into a single network. At the same time, the Russian School of Electrical Engineering was considered one of the best in the world, and the level of equipment at the stations was in line with foreign counterparts. Therefore, experts increasingly called on the authorities to systematize the process of energy supply to the country so that the development of industry would be facilitated by the expansion of the energy base. The task was also to electrify transport, housing and utility sector and unite the entire infrastructure with an extensive power transmission network.
By 1914, domestic scientists and engineers had developed the foundations
of the strategy for the electrification of Russia and arranged the construction
of individual large power stations, but the outbreak of the First World War
hindered the formation of a national program at that time. Immediately after
the October Revolution, the new leadership of the country set the task to create
a unified program for country revival and development, which was based on
accelerated electrification aimed at the development of industry, construction,
transport and agriculture.
As a result, by the end of 1920, the State Commission for the Electrification of Russia prepared the Plan for the Electrification of the RSFSR or the GOELRO Plan.
The GOELRO Plan, with a budget of 17 billion rubles and a term of duration of 10 to 15 years, determined in detail the trends, structure and proportions of development not only for each industry, but also for each region. The authors of the GOELRO Plan proposed the Russia’s first economic zoning based on the consideration of the proximity of sources of raw materials (including energy), the existing territorial division and specialization of labor, as well as convenient and well-organized transport. As a result, seven main economic regions were identified.
The GOELRO Plan envisaged the construction of 30 district power plants (20 TPP and 10 HPP) with a total capacity of 1.75 million kW, as well as the construction of a network of high voltage power lines. In 1922, the country’s first 110 kV power line – Kashirskaya SDPP – was put into operation in Moscow, and in 1933, a more powerful line – 220 kV – Nizhnesvirskaya HPP – Leningrad was brought into service. There began the aggregation of the power stations of Gorky and Ivanovo and creation of the energy system of the Urals.
The program of the GOELRO Plan, which envisaged the restoration of the battered energy economy of the country, was implemented as early as in 1926. And by 1931, the tenth anniversary of the program, all the leading indicators for energy construction were exceeded. By the end of 1935, that is, by the 15th anniversary of the GOELRO Plan, 40 district power stations with a total capacity of 4.5 million kW were built instead of 30 designed ones. By 1935, the Soviet energy industry reached the level of world standards and took the third place in the world after the US and Germany. It must be said that many power stations built within the framework of the GOELRO Plan, after repeated upgrades, are still operating successfully.
A special merit was the complete import substitution of power equipment. Considering that in 1923 the Elektrosila plant manufactured only the first four hydrogenerators with a capacity of 7.5 MW each for the Volkhovskaya HPP, since 1934 the USSR no longer needed imports for power engineering. The technological level of enterprises has significantly increased. By 1937, the majority of machines in the industry was switched to electric drive.
The production of a sufficient amount of energy made it possible to successfully develop energy-intensive industries, in particular, metallurgy, as well as to automate agricultural work; ordinary citizens no longer had to save electricity.
This year, the 75th anniversary is also celebrated in the Russian
nuclear industry. When it comes to the use of peaceful nuclear energy, in 1954
the world’s first nuclear power plant with a capacity of 5 MW was launched in
Obninsk. As early as in October 1954, the Council of Ministers of the USSR
approved a large-scale program for the construction of a NPP, panned for 1956–1960.
In the same years, the construction of nuclear power plants started in the
countries of Eastern Europe, Asia and Africa, where 25 nuclear units were built
in the period from 1957 to 1967.
Electric Power Industry Today
In the 2000s, the electric power industry was reformed, which made it possible to solve a number of urgent issues of the 1990s. Some of them are shortage of investments in the sector, problems of reliability of electricity supply, and the presence of an imbalance in market regulation. As a result of liberalization, the electricity market became more flexible and began to develop at a much faster pace. From 2000 to 2020, the installed capacity in the Russian electric power industry and electricity consumption increased by about a quarter.
Losses in electrical networks have been reduced by almost 9 % over 7 years. Average time needed to restore power supply to residential consumers due to technological disruptions decreased by 45 %
Today, the electric power complex of the Russian Federation is still one of the most developed in the world. There are more than one thousand power plants in our country, including 11 nuclear power plants, 170 hydro power plants, 935 thermal power plants and more than 90 renewable energy generation plants. In total, more than 2.6 million km of power lines have been laid in Russia and 885 thousand megavolt-amperes of transformer capacities are generated. Over the past 7 years, electricity consumption and generation have grown by almost 5 %. At the end of this year, electricity generation is expected to be at the level of 1,075 billion kWh, and in this indicator Russia ranks 4th in the world.
A significant contribution to the renewal of power generation funds was made due to the program for the construction of power plants under capacity interconnection agreements (CIA), which has become one of the largest and most successful investment attraction instruments in the Russian economy. The CIA resulted in major development of domestic power engineering, design and construction industries. Consequentially, the installed capacity of power plants increased by 30 GW over 7 years, of which 29 GW were due to CSA. In total, more than 130 projects have been implemented.
In 2019, the CIA program was replaced by a new mechanism for attracting investments in the modernization of outdated key equipment of thermal power plants based on the long-term capacity market. The program will help to modernize 41 GW of generating capacity of thermal power plants until 2035. As a result, we will receive a 16 % renewal of fixed assets and new investments of up to 1.86 trillion rubles. The fundamental condition of this mechanism is the mandatory maximum localization of the key generating equipment, which means that significant emphasis is put on import substitution. Currently, 17.2 GW have already been selected until 2025. Except for this year, which is associated with the coronavirus pandemic, there is a progressive increase in electricity consumption, but the industry is consistently coping with the needs of the economy and the social sphere in electricity and heat energy.
Particular attention is paid to the quality and reliability of energy supply to consumers in the country.
Russia’s energy balance is consistent with the logic of the global decarbonization trend. Today 85.6 % of electricity generated comes from carbon-free or low-carbon sources
electrical networks have been reduced by almost 9 % over 7 years. Over the past
7 years, the number of regions with high risks of power supply disruptions has
decreased threefold – from 9 to 3. The average time to restore power supply to
household consumers due to technological disruptions has decreased by 45 %,
from 4 hours 24 minutes to 2 hours 25 minutes. In large cities, consumers
in most cases do not feel technological disturbances – for several minutes, the
voltage is supplied from backup sources.
In the field of heat supply, stable, long-term and transparent conditions have been created to attract investments in the industry. By December 1, 2020, 13 municipalities have already switched to a new model of the heat supply market with the expected volume of private investments in the heat supply complex of these cities in the amount of about 92 billion rubles. This issue is being actively worked out in at least 18 other municipalities with the expected total volume of investments, according to our estimates, of about 152 billion rubles.
In recent years, the nationwide tasks of ensuring independent and reliable power supply to a number of strategic regions of Russia, such as the Republic of Crimea and Sevastopol, the Kaliningrad Region, the Far Eastern, North Caucasus and Siberian Federal Districts, have been solved.
Since the previous year, at the legislative level, there has been a basic platform for the transition to long-term tariff regulation in the electric power industry, which introduced the possibility of concluding regulatory agreements in the power grid complex and setting long-term tariffs for electricity transmission services. The changes will allow local authorities to more comprehensively influence the situation with tariffs in the regions, as well as provide more predictable parameters for the industry, which will stimulate investment inflows.
By the end of 2020, commissioning of new renewable energy facilities is expected at the level of at least 1,150 MW, and the installed capacity of renewable energy facilities in the UES of Russia will reach about 2.85 GW by this time
Over the past few years, a lot of work has been done in terms of connecting consumers to power grids, as a result, the connection procedure has been simplified, and the Russian Federation has risen from the 188th to the 7th place in the World Bank Group’s Doing Business rating in terms of “Connection to the power supply system”, which was the best result among all indicators of our country in Doing Business. In terms of “Electric power supply reliability index” and “Transparency of tariffs” (on electricity), the country has shown the maximum possible scores for the 5th year in a row – 8 out of 8.
Despite the positive results in the development of the energy industry, we are faced with the task of improving the main components of the country’s power grid complex – areas traditional for the energy sector, which have a key impact on reliable operation today and tomorrow, need further adjustment. At the same time, new technologies will be developed simultaneously for the production, storage and transmission of electric power, which can become the key to successful competition in the world market as early as the day after tomorrow.
Electric Power Industry of the Future
The leading role in the global energy balance in the coming decades will remain with hydrocarbons. At the same time, the latest global trends confidently indicate that in the 21st century electrical power will become the final link in the delivery of energy to the end consumer.
Herewith, given the global trend towards decarbonization of the world economy and the desire for a low-carbon future, primary energy sources, that is, the feedstock for generating electricity, will play a significant role. It should be emphasized that in terms of electricity generation, Russia’s energy balance is already consistent with the logic of a low-carbon world and is one of the “cleanest”.
Zero-carbon sources of power generation account for more than a third (35.9 %) of the total output: 17.4 % relate to HPP, 18.5 % – to NPP. Plus another 0.2 % relate to the emerging renewable energy industry. As for carbon sources, another 49.7 % of the output account for gas, which is the most environmentally friendly type of fuel.
That is, more than four-fifths (85.6 %) of electricity generated today comes from zero-carbon or low-carbon sources, and by 2035 this figure will almost reach 90 % (88.6 %). Until 2035, it is planned to put into operation new 78.6 GW of generating capacities, of which 16.8 GW will account for NPP, 2.2 GW – for HPP, 50.1 GW – for TPP (with 41 GW due to gas and 8.9 GW due to coal use), and 9.5 GW – for RES. In 2019, as compared to 2014, Russian TPP reduced emissions of pollutants into the atmosphere by 19.6 % (average decrease amounted to 3.3 % per year), greenhouse gases – by 6.48 % (average decrease amounted to 1.1 % per year).
At the state level, considerable attention is paid to the development of renewable energy sources. For Russia, which has huge reserves of hydrocarbon resources, this is important for two main reasons. The first is power supply to remote and hard-to-reach regions of the country. The second is maintaining leading position in the world energy markets, which in the future may become impossible without a sufficiently high level of competence in renewable energy sources.
In 2019, the commissioning of new renewable energy facilities in Russia amounted to 594 MW. By the end of 2020, commissioning of new objects is expected to be at the level of 1,150 MW, which is 93 % higher than the indicators of the previous year, resulting in reaching about 2.85 GW in terms of installed capacity of renewable energy facilities in the UES of Russia.
In 2016–2019, the average capital expenditures for projects per 1 kW of installed capacity decreased: in solar energy, this indicator decreased by 59.5 %, in wind generation – by 58.2 %
Over the past five years, there has been an increase in competition in
the renewable energy market. As a consequence, there is a gradual reduction in
the cost of renewable energy production both in the world as a whole and in our
In 2016–2019, the average planned capital outlay for projects per 1 kW of installed capacity decreased significantly: at the end of 2019, this indicator fell by 59.5 % compared to 2015 in terms of solar energy, and by 58.2 % in the field of wind generation over the same period.
The gain involves not only the generation of electric power based on renewable energy sources, but also the production base of this industry, which is new for the domestic power engineering industry. For example, last year, after the completion of the second stage of modernization of the Hevel plant in Novocheboksarsk, the annual output of heterostructure solar modules was increased from 160 to 260 MW, which made it possible to meet the current needs of the Russian solar energy market by 50 %. As for the wind power sector, in 2019, the first blades for wind turbines manufactured at the Ulyanovsk plant began to be shipped for the construction of a wind farm in the Rostov region, and the assembly of the first wind turbine nacelles in Russia was completed.
At the same time, it is important for us to make RES production technologies export-oriented. This year, the Russian government has already provided for the possibility of using mechanisms to support the export of generating equipment applied in power generation with the use of RES. It is planned to extend this practice to the renewable energy support program on the wholesale market after 2024, introducing the condition of compliance with the target indicators for the export of renewable energy equipment and services related to its design and installation into the system of requirements that apply to participants in the competitive selection of renewable energy projects in the wholesale market.
In Russia, the share of nuclear power plants in electric power production in 2019 increased to 19 %, in the European part of the country it exceeds 40 %. This is a new record in the entire history of the domestic nuclear industry.
The relevant draft regulatory documents are being considered by the government of the Russian Federation.
Today, conditions are being created in our country to develop renewable energy sources not only in the wholesale, but also in the retail electric power markets, including for their smallest segment, namely microgeneration (up to 15 kW) based on RES. Laws have been adopted to simplify the procedure for accommodation of micro-generation facilities, provide their owners with the opportunity to sell surplus generated electricity in retail markets and create tax incentives for the development of this sector. The necessary by-laws will be adopted by the government of the Russian Federation in the nearest future. It is worth noting that they provide, inter alia, preferential terms for connecting micro-generation facilities to the electric grid, which will make such projects available to a wide range of citizens.
In addition, changes were made to the regulatory basis this summer,
which significantly optimized the procedure for competitive selection of
renewable energy projects in retail markets (with an installed capacity of up
to 25 MW). As a result, the investor will receive a guaranteed price for
electric power for the entire payback period of the investment project and,
accordingly, the opportunity to compete by the criterion of the minimum price
for electric power, which gives an incentive to implement the most efficient
renewable energy generation projects for the respective region.
These measures provide both the reduction of the price burden on end users and the choice of the most modern and efficient energy production technologies.
Intellectualization and digitalization of all technological processes will play a decisive role in most industrial sectors, including the electric power sector. Smart power grids in combination with consumer services are going to bring the quality of power system operation to a new level, allowing to change its operating mode in real time, thereby reducing the number of technological disturbances and accelerating recovery from them.
It is indicative that in the situation with a pandemic, when we were faced with limited mobility, electric power companies, where the advanced introduction of digital technologies has been going on for several years, managed to competently introduce existing developments and implement new digital formats in the shortest possible term. It is obvious that in modern conditions digitalization can become the real driving force for the technological progress. Currently, work continues on the “Strategy for the digital transformation of the electric power industry.” The document will reflect the main indicators of the effectiveness of digital transformation of companies and the target vision of the future model of the industry as a whole in the medium-term (until 2024) and long-term (until 2035) planning horizons.
In Russia, the electric vehicle segment is still at its initial stage, but in the first 6 months of this year, the number of electric vehicles in the country increased by more than 25 %, up to 7,295 units.
One more promising area is nuclear power. By now, many countries of the world are returning to the use of the peaceful atom as one of the most highly productive energy sources with low emissions of pollutants and unlimited fuel reserves.
I am sure that the share of electric power generation at nuclear power plants will grow.
In Russia, the share of nuclear power plants in electric power production at the end of 2019 increased to 19.04 %, in the European part of the country it exceeds 40 %. This is a new record in the entire history of the domestic nuclear industry. In addition, Russia is a recognized leader in nuclear energy on a global scale: the portfolio of foreign orders of Rosatom exceeded $130 billion at the end of 2019. And we eager to develop this potential. A new technological platform in nuclear power, which includes a closed nuclear fuel cycle and fast neutron reactors, may become an extensive power source in the future. These technologies allow minimizing the accumulated radioactive waste and massively expand the fuel base of the nuclear power industry.
Another breakthrough technology of the future may be nuclear fusion, the advantage of which consists in the absence of the threat of an uncontrolled reaction, which, accordingly, eliminates the possibility of occurrence of man-made disasters. Today, scientists around the world are working to create an effective model for generating energy using such a system that can provide the entire population of the Earth with the required amount of electric power in the future.
A separate major task, the solution of which will help to make a breakthrough in the use of electric power, is the creation of powerful and mobile storage units. The need for the development of such technologies will grow with the spread of renewable energy sources and electric vehicles. Today, the US and China are most active in the world in working on this issue, the latter considers energy storage as one of the 8 key areas of energy development. Russia has also begun to form the basis for creating energy storage systems based on next generation technologies. In our country, energy storage systems can optimize the operation of micro-power systems, both for residential and commercial consumers, as well as for large-scale energy sector and the grid complex, including at grid infrastructure facilities and in areas where generators included in the UES are currently used. A separate area of application is hydrogen energy, which is also actively developing. In addition to meeting domestic needs, the task is to develop export potential in this direction.
Improving energy storage systems is especially important for the development of electric transport. All over the world, there is a tendency to replace cars with internal combustion engines with electric vehicles, which is associated with efforts to combat global warming and the implementation of the Paris Agreement, as well as with the strategies of states to gradually reduce the use of hydrocarbons in the fuel and energy complex.
By 2030, 10 countries have announced their intention to end the registration of vehicles with internal combustion engines: Norway, Sweden, Denmark, Israel, Ireland, Iceland, the Netherlands, France (in the capital Paris), China and India.
In Russia, the electric transport segment is still at the initial stage of development, but since the beginning of the year, quantitative and percentage indicators have improved significantly. According to the Autostat analytical agency, during the first 6 months of this year, the number of electric vehicles in Russia increased by more than 25 % and amounted to 7,295 units. This is just 0.014 % of the total car fleet of Russia. At the same time, at the level of the state and companies, a comprehensive program for the development of charging infrastructure is already being implemented to create conditions for the introduction and use of electric transport, including personal and public.
The trend towards increasing energy efficiency is of particular importance in modern conditions. Rational use of energy will help to significantly save resources, thereby also to reduce the impact on the environment and to ensure reserve for the further successful development of the industry. That is, the electric power industry of the future is a reliable system, safe for humans and the environment, capable of providing affordable electric power to every corner of the planet and thereby ensuring maximum comfort for people, for the development of the world industry and economy.