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Pain without gain? Reviewing the risks and rewards of investing in Russian coal-fired electricity
journal contribution
posted on 2023-06-08, 23:31 authored by Natalya Gorbacheva, Benjamin SovacoolBenjamin SovacoolCoal use—and thus investment—is expected to grow considerably in the Russian Federation over the next few decades. Projections suggest that at least $200 billion of investment will be needed to modernize existing coal-fired power plants by 2030, but the bulk of this financing is to come from the private sector or foreign enterprises. This study asks: what are the possible investment risks and rewards of pursuing this expansion of coal in the Russian power sector? To provide an answer, the study uses a mixed methods approach consisting of elite semi-structured interviews and a review of English and Russian peer-reviewed literature. The study provides a brief overview of the Russian electricity sector before discussing five distinct rewards to investing in coal such as low production costs, competitive returns on investment, rural modernization, expansion of exports, and the acceleration of innovation. These benefits however are offset by five risks: inferior performance to investments in oil and gas, development challenges, air pollution and climate change, social degradation from mining, and a tradeoff with existing policies incentivizing renewable energy and energy efficiency. The study concludes by analyzing what these disparate risks and rewards mean for policymakers and energy analysts.
History
Publication status
- Published
Journal
Applied EnergyISSN
0306-2619Publisher
PergamonExternal DOI
Volume
154Page range
970-986Department affiliated with
- SPRU - Science Policy Research Unit Publications
Full text available
- No
Peer reviewed?
- Yes
Legacy Posted Date
2016-02-22Usage metrics
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