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Title:
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Russian energy markets: current situation and opportunities for co-operation
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Author(s):
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Published by:
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Publication date:
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ECN
Policy Studies
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1-2-1999
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ECN report number:
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Document type:
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ECN-C--99-027
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ECN publication
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Number of pages:
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Full text:
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66
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Download PDF
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Abstract:
The Russian economy has been and is characterised by a relatively veryhigh energy intensity, abundantly available energy supplies and resources and
central planning. In the transition towards a more market-oriented economy
the energy sector plays an important role, because of its relative importance
to the Russian economy and to stop the wasteful use of the energy resources
necessary for a sustainable long run development of the Russian economy and
European supply security. In this study it is clearly shown that, although
the major policy objectives in Russia are in practice more or less the same
as in the European Union (EU), insufficient attention is paid to energy
saving and efficiency improvement of end-use in all economic sectors. In
order to increase the competitiveness of the Russian economy it is necessary
for the government, local authorities, etc., to pay more attention to the
development of efficiency programmes and policies, to enhance the skills,
knowledge and particularly payment of the energy bills by consumers
(currently the average non-payment is about 80%). With respect to supply, the
abundant reserves of gas, oil and coal did lead to an inefficient
exploration, production and distribution. Therefore, it is necessary to
gradually implement cost based pricing of fuels for production, transport,
distribution and trade, which will result into a more efficient supply to
consumers and allocation of fuels between regions. The gas market, with
Gazprom as the major supplier, should continue its plans for a more efficient
production, transmission and distribution of natural gas. It should also pay
attention to appropriate pricing of gas, namely based on interfuel
substitution. Furthermore, stabilisation of the economy should also allow and
encourage more joint ventures to invest in energy projects, particularly in
the field of improvement of efficiency of production, transport and
distribution of gas, oil, coal and electricity. As a consequence of improving
the efficiency of the entire energy sector, including end-use in economic
sectors, trade between Russia and EU member states can be enhanced, which is
to the benefit of both the EU as well as the Russian Federation. 15 refs.
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