By Swann Bigot, legal expert and consultant – Eurasia Network – May 11, 2017
Rusnano and Finnish energy company Fortum have agreed to establish a Wind Energy Development Fund, revealed a press release of the Russian state corporation.
Partners are planning to invest jointly $ 513 million (RUB 30 billion) in wind farm projects with a total capacity of several hundred megawatts in the next five years.
Large banks would have expressed their interest to take part in the new investment fund.
Besides, Rusnano and Fortum have identified a foreign supplier of wind turbines for future energy joint projects. However, its name was not disclosed. Partners would be in the final stage of negotiations with this supplier.
Last November, Rusnano signed a preliminary agreement with Fortum on the construction of wind farms over the next few years with a total capacity of several hundred megawatts.
The new agreement confirms the attraction of investments for construction of wind farms and localization of the manufacture of wind turbines, as well as venture projects in the renewable energy sector.
One of the main conditions for choosing a supplier of wind turbine is the acceptance of the localization criteria regarding the production of equipment. The level of localization in Russia will increase annually and should reach 65% by 2019.
State corporation Rusnano intends to invest in local production of wind turbines up to $ 17 million (RUB 1 billion). Localization projects will be implemented jointly with the selected supplier and its OEM (Original Equipment Manufacturer) partners as well as Russian technology partners. Investments will be dedicated to the creation of production capacities of parts and components of wind turbines: blades, towers, generators and other elements.
Moreover, equipment will be produced using nanotechnologies. The implementation of wind power projects is expected to generate industrial activity in related sectors (metallurgy, power mechanical engineering, construction, engineering, logistics and services). That would enable Russian companies to develop expertise in this field, join the wind energy global supply chain and create an export potential.
Fortum is planning to include in the partnership with Rusnano the 35 MW wind farm under construction in the Ulyanovsk region and which is expected to be completed this year. The total investment in this renewable energy facility amounts to € 65 million. Note that local authorities strongly support the initiative and have even decided to reach 1 GW of wind power capacity by 2024.
A significant impact across Russia
So far, the Rostov, Ulyanovsk, Murmansk regions, Krasnodar krai and Stavropol krai, the Republic of Tatarstan and a number of other regions have been identified as promising territories for the construction of wind farms eligible for the new Wind Energy Development Fund.
Territories are selected on the basis of wind speed, logistics, accessibility of the electric grid infrastructure and readiness of local authorities to support the program.
The announced joint initiative is expected to have a significant effect since the establishment of the Wind Energy Development Fund with the launch of new wind farm projects across Russia will create new industrial sectors and jobs: manufacture of wind turbines with related components and construction and exploitation of wind farms.
Russia has a high wind potential thanks to its geography and climate. Today, several wind farm projects are implemented across the country. Therefore, a 60 MW wind farm project in the Republic of Karelia was announced last November with a Chinese investor. Moreover, a 90 MW wind farm is being built by a German company in the Rostov region while a 150 MW wind farm will be launched in the Caucasus by 2019 and a 35 MW wind power plant built by the Finnish company Fortum in the Ulyanovsk region should be completed by the end of this year.
Russia’s wind atlas from Martex Invest LLC (ООО Мартекс Инвест)
The places with the fastest average wind speed are shown in blue. Good industrial potential starts at 6 m/s.
Renewable energy sources have become a new investment opportunity in Russia as the country set the official target of 4.5% of renewable energy share in the national energy mix by 2024. A program to support the construction of 3,600 MW of wind power capacities is currently implemented.
The next tender for wind and solar power capacities will take place from May 29th until June 7th 2017. The results of the competition will be released on June 30th 2017.
While Russia is developing its wind power sector, more than 54 GW of wind turbines was installed across the global market in 2016, which now gathers more than 90 countries according to the Global Wind Energy Council. Global cumulative capacity grew by 12.6% to reach a total of 486.8 GW in 2016.
Thank you for reading us !
We got already 20,000 monthly visitors !
Sign up now to get access to our last articles, it’s free !
© Copyright 2017 – Swann Bigot, legal expert and consultant.