The Energy Transition in the Housing and Utilities Sector and State Support for Programmes to Renew Municipal Infrastructure
Reducing emissions and achieving a high level of energy efficiency, including in the housing and utilities sector amidst the backdrop of tightening international legislation is a strategic objective for the Russian Federation
“We are seeing increased public interest in environmental issues, as well as tightening international legislation on the consumption of hydrocarbon resources. This is a challenging scenario, but it also presents an opportunity to improve the quality and reliability of services and increase economic efficiency. Achieving high levels of energy efficiency is therefore a strategic objective of national importance. The housing and utilities sector is no exception here. In fact, it is one of the industries that deserves the greatest scrutiny… Efforts to increase energy and environmental efficiency are being incorporated into national projects and government programmes," Alexander Lomakin, First Deputy Minister of Construction, Housing and Utilities of the Russian Federation.
High-quality modernization must be carried out across Russia’s housing and utilities system
“Something must be done in order to stem the tide of greenhouse gas emissions and absorption rates… If the housing and utilities sector isn’t transformed in the coming decades, it will become a serious obstacle to reducing the carbon intensity of the Russian economy,” Petr Bobylev, Deputy Minister of Energy of the Russian Federation.
“As for housing and utilities infrastructure, large-scale modernization is required, based on modern, energy efficient equipment that meets all safety standards,” Alexander Lomakin, First Deputy Minister of Construction, Housing and Utilities of the Russian Federation.
Decreased efficiency and reliability of housing and utilities systems, losses for companies when citizens on benefits use energy service equipment
“The key challenge for larger residential units today is so-called beneficiaries. The benefits do not cover energy providers, which must either collect the funds from tenants or suffer losses. The alternative is the benefits recipient paying more than they were paying when the energy service equipment was installed,” Irina Bulgakova, Head of the Housing and Utilities Commission of the Public Council of the Ministry of Construction, Housing and Utilities of the Russian Federation.
Developing a set of standards for construction and modernization in the housing and utilities system, utilizing the ‘infrastructure menu’
“We must develop regional reconstruction programmes that take into account the need to increase energy efficiency and create energy efficient standards for key design solutions. The question of attracting investment from property owners and private investors should also be looked at… We now have a significant number of instruments that could be used to modernize utilities infrastructure, most notably the infrastructure budget loans that allow us to modernize municipal facilities. Another effective support mechanism which is available on a repayable basis is the National Wealth Fund. The mechanism, which is currently being fine-tuned, has so far allocated RUB 150 billion of project financing, covering up to 80% of project costs at a per annum interest rate of 3.5% over 25 years. This is a fairly promising mechanism on preferential terms, and the possibility of doubling funding for the National Wealth Fund is currently being looked at,” Alexander Lomakin, First Deputy Minister of Construction, Housing and Utilities of the Russian Federation.
Increasing the energy efficiency of existing facilities by carrying out major renovations
“As for buildings that have already been constructed, a programme to improve the energy efficiency of major renovations is being implemented. This is beneficial for citizens and the state alike, as it makes it possible to reduce spending on the most expensive utility, which is heating. Costs can be reduced by up to 30% and in some cases as much as 50%,” Alexander Lomakin, First Deputy Minister of Construction, Housing and Utilities of the Russian Federation.
“The energy transition in the housing and utilities sector means, first and foremost, reducing the energy consumption of buildings. It also means the construction of energy efficient housing and mass-scale renovations,” Irina Bulgakova, Head of the Housing and Utilities Commission of the Public Council of the Ministry of Construction, Housing and Utilities of the Russian Federation.
“Mass-scale renovations, which began in 2005–2006, have of course altered the picture. Here [during the discussion], however, I have heard people talk about energy efficient and inefficient major renovation works. Any major renovation is effective as it changes the situation,” Evgeny Gasho, Head of the Research Laboratory for Methodological Problems of Energy Saving, Moscow Power Engineering Institute.
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On 3 October, the panel discussion ‘Stimulating Oil Extraction in the Russian Federation’ was held at the REW 2019 Forum.
Dear Friends, I would like to welcome you on the occasion of the opening of the first Russian Energy Week. The Forum will bring together representatives of government bodies, major industries, business circles and the expert community from Russia and other countries to discuss main global energy development trends. In the framework of the intensive program of the Forum, they will conduct a serious and comprehensive analysis of the current situation in the global energy market and offer effective solutions to the challenges facing the energy sector. Sustainable growth of the modern world economy greatly depends on ensuring energy security. And naturally Russia stands to play a special role as one of the guarantors of energy security for the entire Eurasia. The participants and guests of the Forum will have an opportunity to learn about the prospects of the Russian fuel and energy complex, the strategic projects that are being implemented, as well as to map out areas of cooperation, including in the fields of energy efficiency and introduction of cutting edge technologies that meet the highest environmental standards. I hope that a substantive dialogue among the participants in the Russian Energy Week will be instrumental in working out common approaches to development of the international energy agenda and launching new mutually beneficial initiatives. I wish you every success. Vladimir Putin.