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Russia’s State-supported Renewable Auction Heavily Favored Solar

Russia’s second renewable energy project auction held in June has distributed state subsidies for the years of 2015, 2016, 2017 and 2018. Subsidies were offerred for up to 496 MW of solar, 415 MW of hydropower and 1.65 GW of wind capacity. Fifty-seven applications were submitted, of which an impressive 53 were for solar generation, three for hydro development and a single wind bidder.

The entire offered solar capacity was distributed, while only a mere 51 MW was allotted for wind and slightly over 20 MW of hydro.

China-based Solar Systems has received the bulk of the state-supported solar capacity with 175 MW, while state-owned Energija Solnce scored 165 MW and Avelar Solar Technologies, part of Renova Group was allotted 155 MW.

In the first Russian RES project auction last year, 1,100 MW in wind capacity were offered and 710MW of solar to be built from 2014 to 2017.

“In Russia, the priority in renewables development and expansion is definitely solar power. The sector has got off to a great start in the country mainly thanks to the true ideologist of solar energy Viktor Vekselberg [president of Renova Group-L.J]. He has been actively investing in the development of thin-film solar in the Russian Federation, as well as in the construction of solar power plants,” said Vitalij Davij, president of Ukraine’s Sustainable Energy Market Participant Association. “Renova Group is the linchpin of the sector in Russia, also a very strong lobbyist.”

Unlike last year, the selected projects received the Russian Government’s guarantee that each will see a return on investment in 15 years with a yield of 14 percent.

Anton Usachiov, president of Russia’s Solar Energy Association (RSEA) said he was not surprised to see solar’s land-slide win and the technology is “in the groove.”

“Wind investors were drawn back by the requirement to have no less than half of the facility equipments locally made. This has not been an issue for solar developers,” said Usachiov.

But some Russian experts, who spoke on the condition of anonymity, insisted that the Russian Government has been “impartial” and giving in to lobbyism.

“There are strong speculations the holding has been a major donor of the ruling party United Russia and the holding group president has been a staunch ally of the Russian President. Others simply stood no chance in the competition, hence a very low turnout of wind and hydro bidders,” explained a Russian expert.

The list, compiled and handed in to the European Union by some Russian activists in the wake of the annexation of the Crimea, included and sought EU sanctions against Vekseberg, President Vladimir Putin’s elite circle member and a $17.2 billion asset owner.

Russia’s AltEnergo CEO Victor Filatov said the solar auction results should be viewed rather skeptically because high competition has unrealistically brought down the costs of construction for some photovoltaic facilities.

“For example, IEC-engineering [controlled by UEPC Corporation, headed by former Russian Minister of Fuel and Energy Anatoly Dyakov-L.J] is planning to build two power plants in Dagestan, 5 MW each, for 60,768 and 79,513 rubles [US $1.770 and $2,315] per 1 kWh respectively. This is just too low. I reckon it is impossible to build a solar plant with that rate. The [lowest possible] level should be around $2,915 per 1 kWh,” Filatov maintained.

Lead image: Russian flag via Shutterstock

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I'm a 42-year-old Lithuanian editor and freelance journalist with an extensive journalistic experience. I contribute for a dozen of English publications, including the Baltic Times,, UK-based Energy, New Eastern European, Global Water Inte...


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