Energy Efficiency: Is Implementation Delayed?

Alexander Novak, the Russian Energy Minister, has doubts in feasibility of national plans for reduction of energy consumption. Representatives of Russian NGOs are convinced that the government shall not give up the original plans for energy efficiency - the energy saving potential is huge!

Improving energy efficiency is on the priorities list of the Russian authorities since 2008, when the Russian President signed the Decree "On some measures to improve energy and environmental performance of the Russian economy." This decree gave the landmark to reduce by 2020 energy intensity of the gross domestic product of the Russian Federation not less than by 40 % as compared with 2007. In 2009, the Federal Law on Energy Saving was adopted, and since 2010 the State Programme on energy saving and energy efficiency for the period up to 2020 is carried out. By 2020, the first steps in reducing energy intensity planned by the State Programme shall give saving of 1.124 billion tons of oil equivalent of primary energy, 330 billion cubic meters of natural gas, 630 billion kWh of electricity, 1550 Gcal of thermal energy, and 17 million tons of oil products.

The Energy Minister Alexander Novak said: "If by 2020 the GDP growth will outpace growth in energy consumption, the country will reduce energy consumption by 22 % of the current level. The goal set by Presidential Decree is to reduce energy intensity by 40 % by 2020. This difference of 18 percent means that the inertial method does not give us the opportunity to achieve it." According to the Ministry of Energy, the worst situation with energy efficiency is in industry, and especially bad in the housing sector. In the services sector and in transport sector, the situation is not so bad.

According to most economists, increasing energy efficiency in the economy is beneficial for Russia. With high energy intensity, domestic goods and services become less competitive, as their costs grow. Experts note that failure to implement the plan will tell negatively on budget revenues and economic growth in the long term.

Narek Avakian, a financial analyst to Aforex, expressed his opinion on this issue in an interview to Novaya Gazeta: "Most of the problems are associated with housing sector and metallurgy, although the latter is increasingly investing in energy-saving technologies. Therefore, one can say that the minimum task for the government has already been implemented. However, transition to a qualitatively new level needs major breakthroughs in this direction. In particular, advanced energy efficiency technologies and technologies reducing production cost of electricity shall be introduced. Also, prices for utility services shall be liberalized."

Olga Senova, the head of the Climate Secretariat of the Russian Social Ecological Union is sure: "The potential energy savings in different sectors of the economy are huge. Energy efficiency is the most big, clean and cheap source of energy in Russia. Can we afford not to use it?"

Representatives of Russian environmental organizations write in their statement: "More than one third of the potential energy savings are at the stage of final energy consumers. Upgrading only lighting will save 57 terawatt hours in Russia. Efficient and rational use of energy in homes, schools, offices, and industrial premises by reducing heat losses, using energy-efficient lighting, energy-efficient electrical equipment, monitoring and controlling energy resources, and energy-saving practices will give huge total savings in the country and saving of own resources."

According to the International Energy Agency, the energy gained through energy efficiency and energy saving costs four times less than the energy obtained through construction of new power stations. Improving energy efficiency frees up a huge amount of energy, and this is the real source of energy that can be used for energy needs. In addition, the energy obtained through energy efficiency is safer for the environment and people, reduces polluting emissions and greenhouse gas emissions that lead to climate change.

Environmentalists give actual examples demonstrating huge potential and social, economic, and environmental effects of measures on energy saving and energy efficiency in all regions of Russia and in almost all industries.

Green activists are sure that it is important that the State Program for energy saving reaches its goals. This requires detailed development of law, support for energy service companies, environmental standards, and priority crediting environmentally friendly projects by state banks. Namely such actions will involve all other available potential energy efficiency resources; this will enable to release energy for other industrial and social needs.