Green energy and global warming: a double whammy for Russia

RUSSIA / FSU POLITICS - In Brief 09 Jul 2021 by Alex Teddy
On July 8 the Finance Minister said that Russia has to tighten its belt because green energy is leading to a radical reduction in the need for fossil fuels. Carbon pricing and carbon taxes are a major headache for Russia, which earns 40% of state revenue from hydrocarbon exports. It is the biggest energy exporter in the world. For other post-Soviet states such as Azerbaijan and Kazakhstan, the situation is even worse because they are even more reliant on hydrocarbon exports.The carbon border tax in the EU will be a major problem for Russia. Russia sells more energy to the EU than to any other country or trade bloc. The carbon tax will cost Russia at least several billion EUR per annum. The tariff will impact over 40% of Russian exports.Green energy is also a golden opportunity for Russia. With the vastest land mass in the world the country has an unparalleled capacity to capture renewable energy. Wind energy, solar, energy, wave energy, hydroelectricity and biomass could all be harnessed in Russia. With a low population density Russia would still have a huge amount of energy for export. But this requires decades of investment. Russia garners only 1% of its energy from renewables. Renewable energy is becoming cheaper and more efficient. In the UK the government is reducing subsidies as more companies want to pay for access to seabed sites so they can set up wind farms at sea. In 2020 renewable energy became the EU's main power source for the first time. It is a trend that is going to continue moving away from hydrocarbons. By 2050 the EU hopes to eliminate coal (the most polluting fuel) and use minimal oil with only a little gas. Russia is touting gas as a transition fu...

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