Russian Energy Minister Alexander Novak and Rosseti CEO Pavel Livinsky have confirmed their participation in the conference, and WEC Secretary General and CEO Angela Wilkinson will give the main report.
Naturally, the content of the report is not known. But interestingly, a few days ago an article was released in London about how Covid-19 is transforming how the European Union works, by Charles Grant, director of the Centre for European Reform. Despite the fact that the UK has left the EU, Grant remains one of the most informed and acute experts and he highlights the following as what he sees as undesirable trends for Europe: deglobalization, specifically the disruption of supply chains, not only for medical equipment but even auto components; the resurgent influence of national capitals aiming to counter Brussels; the strengthening of borders, not just the external border of the Schengen zone, but also the reimposition of controls on national borders between zone members amid increasing suspicion of foreigners; as well as growing divisions within the EU along North-South and East-West lines.
In the latter case, Grant points out that in the European elections in May 19, before any pandemic, the greens performed well overall but won few seats in Central and Eastern Europe. He notes the trend of “hostility to policies that are designed to moderate climate change,” and transition from ‘brown’ energy (based on oil and coal) to greener energy.
Meanwhile, amid the coronavirus pandemic, the leader of Northern and Western Europe, Germany moved ahead with plans to transition away fr om not just brown energy. In the early morning of May 14, the country demolished two 152-meter cooling towers at the closed nuclear power plant in Philippsburg. Due to the pandemic, the authorities did not announce the exact time of the explosion in order to avoid drawing crowds, but, as we see, they have not abandoned the decision of May 2011 to shut down seven old nuclear power plants. Germany plans to completely abandon nuclear energy by 2050 and transition to renewable energy sources. The country is also completely phasing out coal.
However, this certainly contrasts with Central and Eastern Europe, wh ere Poland is fighting for its coal, as well as with Russia, wh ere the appointment of Stepan Solzhenitsyn as CEO of coal mining company SUEK was in the news in recent days. In other words, in Russia the development of the brown sector continues.
For our part, we here at Global Energy did not expect the debate that would be generated by the publication in recent days of first our video talk and then a separate article by American Thomas Blees. The president of the international think tank The Science Council for Global Initiatives begins his article blisteringly: “Germany’s infamous Energiewende, or Energy Transition, has seen a massive national investment failing to provide the environmental benefits that were ostensibly the basis for its existence.”
For the full picture, it should be explained that Blees proposes serial and mass construction of floating nuclear power plants as an alternative reliable energy source, particularly for developing countries. But unlike the Lomonosov floating nuclear power plant that Rosatom recently towed to the town of Pevek, Blees is proposing to return to molten salt reactor (MSR) technology, based on a reactor design built at Oak Ridge National Laboratory in Tennessee back in the 1960s. Naturally, only experts will immediately understand all the nuances related to the properties of the new alloys that have emerged since then, as well as grasp the difference between an MSR and SMR (small modular reactor), which Tony Roulstone, Lecturer in Nuclear Engineering at Cambridge University, Director of Bracchium Ltd and Corporate Transformation Director at Rolls-Royce plc, discusses at our request in comments on Blees’s article.
Roulstone makes the obvious, in his view, observation that “the UK has re-discovered the merits of nuclear energy.”
But what about Germany’s position, even if it is no longer in one union with the UK?
In other words, in preparing for the online conference with our colleagues from the WEC in London, there are things to think about, particularly against the backdrop of UK newspapers the Financial Times and the Guardian simultaneously publishing articles about how the coronavirus pandemic is a good opportunity to rethink the energy economy and begin an accelerated transition to renewable sources. Interestingly, after this the China Daily published similar commentary.
At first glance, what’s there to talk about? Just last month, IMEMO President Alexander Dynkin noted, and Global Energy Prize International Award Committee Chairman and Nobel Laureate Rae Kwon Chung (South Korea) worried that new low oil prices will become an obstacle to the development of alternative energy. Oil prices have risen since then, but not enough to be able to talk about the cost effectiveness of the solar or wind energy model favoured in Europe.
Moreover, this week Moscow newspaper Kommersant reported that “investors in renewable energy sources are sending out letters en masse about a force majeure due to the pandemic.” And this was just days after a new solar power plant was opened in Adygeya, and blades from Ulyanovsk were delivered for wind turbines in Denmark. But, according to Kommersant, “Enel Russia has reported problems at wind farms in Rostov and Murmansk regions,” the Wind Energy Development Fund, a joint venture between Fortum and Rusnano, “sent a letter about a force majeure at a wind farm in Kalmykia,” and so on.
And unlike in the EU, in Russia such companies cannot count on massive subsidies. While the publications in the Financial Times, the Guardian and China Daily look like a warmup ahead of the distribution of anti-crisis packages promised by the EU and Chinese, the article in Kommersant is more of an assertion.
All the more surprising against this backdrop is the recent announcement that state corporations Rostec, Rosatom and VEB.RF have entered into an agreement to cooperate on the construction of 25 waste-to-energy plants in Russia. Overall investment in the project is estimated at 600 billion rubles, with VEB expected to contribute about 200 billion rubles.
On the one hand, the problem that these companies are aiming to solve is obvious: landfills in Russia are growing by about 400,000 hectares per year and their total area has already exceeded 4 million hectares, which is comparable to the area of Moscow Region or Denmark. About 7 billion tonnes of waste are generated in Russia every year (2018 data), and about 70 million tonnes of it is just buried. And this is waste that could be processed.
One of the definite optimists in this regard is William Byun, Global Energy Prize International Award Committee Member and Managing Director of Asia Renewables in Singapore. In a conversation with this writer, Byun said he sees the fact that the municipal sector always generates large amounts of waste as a stabilizing factor. This takes place 24 hours a day no matter what happens, and there is always demand for processing of this waste, so the waste-to-energy sector is in a far more stable position than other sectors of renewable energy, he said.
Global Energy Prize Laureate and Russian Academy of Sciences Academic Sergei Alekseyenko pointed out that waste-to-energy is a global trend. The share of incineration is 55% in Denmark, 54% in Norway, 50% in Sweden and 35% in Germany, and in Denmark almost 6% of electricity is generated with waste. In Japan, a leader in this area, 69% of solid municipal waste is incinerated, generating 6.6 TWh with installed capacity of 1.5 GW.
“But in Russia, solid municipal waste can only be incinerated with electricity generation at three plants located in Moscow with combined power capacity of just 26.6 MW. Accordingly, in developed countries only processed (neutral) waste is subject to dumping, and with minimization of its amounts to as low as zero (0% in Switzerland, 1% each in Germany, Sweden and Denmark). But in Russia, the share of landfills is 95%, and only 5% of solid municipal waste goes for processing, with a small share of incineration,” Alekseyenko said.
The International Energy Agency has also said that energy from waste, with controlled incineration and technology to control environmental pollution is the best alternative to landfills.
The problem, however, is that, as Byun acknowledges, generating energy from waste is currently far more expensive than other means, including hydro, solar, wind, coal, oil and gas. This is partly because the technology has not yet reached the threshold wh ere it so widely adopted that there are cost savings through economies of scale. Byun estimated it is twice as expensive as wind and far more expensive than solar energy, simply because solar has reached a point wh ere it crossed the threshold and the price fall dramatically, and it is also far more expensive than conventional sources.
In conclusion, let’s return to what Centre for European Reform Director Charles Grant wrote in his article about the new challenges facing the EU. “The economic consequences of the coronavirus seem likely to strengthen opposition to climate-friendly policies. Many voters whose standards of living are falling dramatically will not want to take a further hit by embracing radical measures designed to lessen climate change,” he wrote.
Grant also quoted French economist Jean Pisani-Ferry, who said: “Poorer citizens will likely be more reluctant to bear the cost of replacing obsolete ‘brown’ capital embedded in heating systems, cars and machines with greener but costly capital, because this would destroy even more of the old jobs and leave even less income available for short-term consumption.”
This raises two main philosophical questions that I also intend to raise, if possible, at the upcoming online conference with WEC. A philosophical economic question: Perhaps it’s time to stop being hostages to slogans and catchwords, and resume a calm conversation about the energy balance that will, among other things, solve the issue of preserving jobs after the pandemic? And a philosophical ethical question: Who should assume the cost of offsetting the higher price of electricity from more expensive but admittedly appealing waste incineration plants?
Now if only one could explain to the British why in Russia the owners of the most expensive cars cover their license plates with a piece of paper when parking.