Russia remains one of the largest electricity producers in the world, siting only behind China, USA, Japan and India. Strong electricity demand is driven by the relatively low energy efficiency of national industries. This strong demand consequently challenges the limited and ageing energy producing capacity and explains the permanent tariff growth and the reason why this is one of the sources for high investment programs by the power generating companies.

In 2013, the electricity output in Russia decreased by 1% year on year and reached 1,057 billion KW/h.

Russia’s power complex includes approximately 600 power plants each with an individual capacity of over 5 MW. In 2013, the total capacity of Russian power plants amounted to 241.7 GW, exceeding the 2012 level by 6.7 GW. Growth was driven by the construction of new power facilities and the modernisation of existing infrastructure.

The power industry has the following components of generation: thermal plants (68%), hydraulic (21%), nuclear (approximately 11%).

The long-term outlook of the Russian power industry is influenced by the “General scheme of energy development for the period till 2020”.

Thermal power plants

In the main, thermal power stations in Russia use organic fuels such as gas or coal and basically consist of steam-turbine power stations.

In 2013, Russia’s overall installed thermal power plant capacity installed was 166.7 GW, up 2.9% compared to the previous year.

The infrastructure in the thermal power sector is quite outdated — almost 55% of the installed capacities over 30 years old. As such, Russian plants have an efficiency ratio of 37%, which is lower than the 41% level for developed economies. This discrepancy dictates the necessity for equipment upgrades by all the major power generating companies. This is also the reason why the technical modernisation and reconstruction of the existing power stations is a primary development goal of the Russian thermal power sector, in addition to the start-up of new modern generating capacities. Around 25 projects have been executed in 2013 with a total capacity of 4.7 GW.

The sector’s investment grew by 14.8% year-on-year in 2013 and reached Rub 365 billion.

Nuclear power plants

Russia has a full-cycle technology for the nuclear industry — from the extraction of uranium ore to electric power generation. Currently, 33 nuclear power units, with an overall installed capacity of 25.2 GW, are operated at 10 sites by Rosenergoatom. They account for 16% of domestic electricity generation. The share of nuclear generation in the European part of Russia reaches 30%, and, in the North-West part of Russia, 37%.

Currently, there is an ongoing process of large-scale NPP construction in Russia. The following construction projects are underway: Novovoronezhskaya NPP Phase II, Leningradskaya NPP Phase II, Baltic NPP, and the world’s first floating nuclear co-generation plant Academic Lomonosov. Another nuclear power unit — the fourth reactor of Beloyarsk NPP — is close to completion. In addition to construction in Russia, nuclear power plants are being built in overseas countries, including Kudankulam (India), Bushehr (Iran), Akkuyu (Turkey), Ostrovets (Belarus), and Tianwan Second Stage (China).

Most of the 33 nuclear operating reactors in Russia are ageing; 80% of capacity has a maturity of 20-40 years. This has led to the development of a large-scale investment programme by the state operator Rosatom, under which several initial steps have already been taken.

In 2013, electricity output grew by 2% year on year and reached 172.7 billion KW/h.

The estimated investments in the sector increased 16.3% year-on-year in 2013 and reached Rub 300 billion.