Russia and India need to strengthen cooperation in renewable energy

India and Russia have cooperated in a series of fields in recent years, but cooperation in the field of renewable energy is slightly insufficient. At present, the international community is working hard to reduce the impact of climate change on human beings. Renewable energy sources provide a clean, cheap and efficient alternative to humankind.

Russian President Vladimir Putin will visit India on December 24. Renewable energy cooperation will be the focus of the two countries’ leaders. However, it is still unclear whether an effective agreement can be reached in the end.

Russia naturally hopes to strengthen cooperation with India in the energy field, because each year India has invested more than US$10 billion in clean energy. In addition, investment in renewable energy in India is mainly driven by the private sector, which is also very attractive to Russia.

India currently has 26 GW of renewable energy installed capacity, ranking among the top five in the world, and its power generation share accounts for 12.5% ​​of India's total. India plans to produce 55 GW of renewable energy by 2017.

Sources said that India and Russia decided to jointly invest 180 million U.S. dollars to set up a joint venture company to produce solar modules. The project aims to provide assistance to the emerging solar industry in India. The silicon ingots produced by the joint venture company will be sold to India to protect the majestic solar energy development plan of India. Russia's state-run nanotechnology company, the Russian government's nanotechnology technical committee and the Indian science and technology department have closely discussed the project to ensure the orderly development of India's photovoltaic industry.

India has recently issued a draft for the second phase of the national solar energy plan. In fact, the purpose of India's national solar energy plan is to build India into a global leader in new energy.

In May 2010, Medvedev, the then Russian president, announced that the Russian government will carefully consider the purchase of renewable energy power to promote its development. In the following six months, Russia approved a $300 billion project to help enterprises and buildings save energy. By the end of 2009, Medvedev announced that Russia’s energy consumption would fall by 40% by 2020, and the Russian government plans to use 4.5% of energy consumption from the non-hydropower renewable energy industry.

The latest report of the global renewable energy industry shows that global consumption of renewable energy has risen by 16.7%. However, both Russia and India are falling behind in this regard. In the future, India and Russia should create a win-win situation in this regard. Of course, for Russia, there is still a long way to go to realize this great development goal, because Russia’s current core is oil, natural gas and coal, which accounts for 80% of its total foreign trade.

In addition to new energy cooperation, Russia and India have made remarkable achievements in traditional energy sources. Sakhalin-1 is often seen as a model of energy cooperation between the two countries. In 2001, India gained some momentum in the Russian energy industry. At that time, the oil and gas company’s overseas branch invested 2.7 billion U.S. dollars to obtain a 20% stake in the Russian oil company Sakhalin-1. Sakhalin-1 is operated by ExxonMobil Neftegaz, a subsidiary of ExxonMobil of the United States. ExxonMobil has a 30% stake, and Sakhalin-1 covers an area of ​​1,146 square kilometers. In the earlier period of Sakhalin-1, two offshore oil fields, Chayvo and Odoptu, were put into production in 2005 and 2010, respectively. The third offshore oil field, Arkutun Dagi, is currently in progress.

In order to continue expanding India’s energy business in Russia, India’s oil and natural gas company purchased a London-listed Imperial Energy Company in January 2009 for US$2.1 billion. The company has many energy projects in Tomsk, in the Western Siberia region. Local officials said that India’s oil and natural gas companies paid at least US$1.1 billion to acquire Imperial Energy, because the company’s oil reserves are far less than legendary. According to data from the Indian Oil and Gas Corporation website, Imperial Energy's oil production is less. Judging from the current situation, India intends to continue to strengthen its traditional energy investment in Russia.

In July 2006, Indian Prime Minister Manmohan Singh said during a meeting with Russian President Vladimir Putin that he hopes to get a steady supply of 1 million barrels of crude oil from Russia every day to ensure energy security in India. But even 10 years after the Sakhalin-1 investment, the dream is still far away. Perhaps the current opportunity can change this situation or even become better. Perhaps the two countries’ energy sector will sign the upstream and downstream commercial contracts this month.

In fact, both sides have the will for the energy cooperation between Russia and India. For Russia, they also intend to open up new markets. In 2006, Putin stated at the Russia conference that Russia is willing to open up new oil and gas pipelines and civilian nuclear energy to open up the Asian market.

In addition to conventional oil and gas, Russia also has a strong civilian nuclear energy technology, which can guarantee India's energy security, but the security concerns caused by the Fukushima nuclear crisis have caused this cooperation to decline. The concern of local residents in India is that the Kudankulam nuclear power project will be postponed.