National Human Development Report in the Russian Federation 2009 Energy Sector and Sustainable Development The United Nations Development Programme (UNDP) is the UN’s global development network, advocating change and connecting countries to knowledge, experience and resources to help people build a better life. National Human Development Report in the Russian Federation 2009 Energy Sector and Sustainable Development Moscow 2010 The 2009 National Human Development Report (NHDR) for the Russian Federation has been prepared by a team of Russian experts and consultants. The analysis and policy recommendations in this Report do not necessarily reflect the views of the UN systems and other institutions by which the experts and consultants are employed. Chief Author: Isak D. Froumin, Dr.Sc. (Pedagogics), Lead Education Prof. Sergey N. Bobylev, Dr.Sc. (Economics), Faculty of Specialist, Russia Country Department, World Bank; Head of Economics at Lomonosov Moscow State University Research Institute for Education Reform, State University - Higher School of Economics Denis V. Nikolaev, MA in Education, Consultant in Authors: Education Sector, Human Development Department, Russia Leonid M. Grigoryev, PhD. (Economics), President, Country Department, World Bank Institute for Energy and Finance; Chairman of the Board, Education for Energy Sector (Box 3.1) WWF-Russia; Dean of Management, Moscow International University Evgeny A. Zenyutich, Ph.D. (Engineering), Director, Alexander A. Kurdin, Expert, Economic Research, Research Institute of Energy Efficient Technologies, Nizhny Department of Economics, Institute for Energy and Finance Novgorod State Technical University; General Director, Chapter 1 Nizhny Novgorod Investment Center of Energy Efficiency Programme of the Ministry of Education and Science of the Natalia V. Zubarevich, Dr.Sc. (Geography), Professor, Russian Federation: Integrated Solutions for Saving Energy Department of Geography, Lomonosov Moscow State and Resources to Promote Innovative Development in University; Head of Regional Programs, Independent Various Sectors of the Economy (Box 5.1) Institute for Social Policy Energy efficiency indicators used by the Federal Education Chapter 2 Agency (Box 8.2) Lilia N. Ovcharova, PhD. (Economics), Research Director, Prof. Rafael V. Arutyunyan, Dr.Sc. (Physics and Independent Institute for Social Policy; Mathematics), First Deputy Director, Institute for Safe Head of Laboratory of Distributive Relations, Institute of Development of Atomic Power Engineering, Russian Social and Economic Studies of Population, Russian Academy of Sciences Academy of Sciences Irina L. Abalkina, PhD. (Economics), Senior Researcher, Alexandra Ya. Burdyak, MA (Economics), Senior Laboratory of Systems Analysis, Institute for Safe Researcher, Independent Institute for Social Policy Development of Atomic Power Engineering, Russian Chapter 3 Academy of Sciences Nuclear Power Opportunities (Box 6.3) Prof. Boris A. Revich, Dr.Sc. (Medicine), Professor, Head of Laboratory, Institute of Forecasting, Russian Academy of Victoria R. Bityukova, Ph.D. (Geography), Associate Sciences Professor, Geographic Department, Lomonosov Moscow Chapter 4 State University Environmental Sustainability of Russia’s Urban Igor A. Bashmakov, PhD. (Economics), Executive Director, Development (Box 7.2) Center for Energy Efficiency (CENEf) Chapter 5 Alexander S. Martynov, PhD. (Biology), Director, Independent Ecological Rating Agency Igor S. Kozhukhovsky, PhD. (Economics), General Director, Power Efficiency Rating of Russia’s Constituent Entities Energy Forecasting Agency (the EFA) (Box 8.4) Olga A. Novoselova, Head of Ecology and Energy Efficiency Program, Energy Forecasting Agency (the EFA) Chapter 6 National Human Development Report 2009 for the Russian Federation /Edited by Prof. Sergey Bobylev; editing in English Victor I. Danilov-Danilyan, Dr.Sc. (Economics), by Ben W. Hooson/ Design and prepress and printing by Corresponding Member of the Russian Academy of LLC ‘Design-project ‘Samolet’. – M., 2010 – 166 pages, 45 tables, Sciences; Director, Institute of Water Problems, Russian 50 figures, 21 boxes. Academy of Sciences Chapter 7 Readers are invited to inspect the latest Human Development Prof. Sergey N. Bobylev, Dr.Sc. (Economics), Faculty of Report for the Russian Federation. National reports such as this Economics at Lomonosov Moscow State University are published on the initiative of the United Nations Chapter 8 Development Programme (UNDP) in many countries of the world. Global reports are also brought out annually. The reports are compiled by teams of independent experts. Box Contributors: The 13th Human Development Report for the Russian Federation Alexander A. Averchenkov, PhD (Economics), Senior assesses impact of the energy sector on the country’s economy Climate Change Adviser, UNDP and human development. The global economic crisis has Correlation between climate change, the energy sector and brought many problems, but it also offers a window of human development (Box 1.1) opportunity for Russia to transform its energy sector, which Opportunities for use of carbon market instruments to raise evolved in its present form during the late 20th century, into a power efficiency of the Russian economy (Box 5.2) modern, high-tech vanguard for the national economy in the 21st century, with due respect for the environment and human Olga A. Murashko, Research Scientist, Institute for Research health. Issues, which are the traditional subject matter of human Studies and the Museum of Anthropology, Lomonosov development reports – economic development, income levels, Moscow State University; Journal Editor, Russian Association employment, education and health care – are discussed in the of Indigenous Peoples of the North context of the energy theme. Native Minorities of the North and the Energy Sector The Report is intended for top managers, political scientists, (Box 2.2) scientific researchers, teachers and high school students. 2 National Human Development Report in the Russian Federation 2009 ACKNOWLEDGEMENTS The authors express their gratitude to the management and employees of the Department of International Organizations at the Ministry of Foreign Affairs of the Russian Federation: Gennady M. Gatilov, Director of the Department; Dmitry I. Maximychev, Deputy Director of the Department; Victor I. Zagrekov, Head of the UN Technical Assistance Division and the National Project Director, as well as to the staff and management of the UNDP Russia Team: Frode Mauring, UN Resident Coordinator/UNDP Resident Representative; Sascha Graumann, Deputy Resident Representative; Elena A. Armand, National Programme Coordinator; Victoria K. Zotikova, Communication Analyst; Mikhail V. Babenko, Project Manager and Natalia V. Voronkova, Project Coordinator. The authors also thank the Federal State Statistics Service (also called ‘Rosstat’) for data provided for the Report, as well as the participants of Public Hearings on the Report draft for their constructive comments. 3 Address to readers The 2009 National Human Development of energy transportation routes, increase of Report (NHDP) for the Russian Federation, energy efficiency, market transparency, entitled ‘Energy Sector and Sustainable development of renewable energy sources and Development', outlines issues associated with a creation of national management institutions for prime concern in Russia today, which is energy efficiency. development of the fuel & energy sector. The An important step will be change of authors provide a detailed analysis of the Russia’s technical control legislation in order to situation, make forecasts and study the options increase energy efficiency and environmental for overcoming current negative trends in supply safety of such industries as power generation, and consumption of energy resources. construction, transportation, and housing The energy sector currently supports all utilities. Power efficiency indicators will become other parts of the Russian economy, consolidates mandatory requirements of the new technical constituent entities of the Russian Federation and control system. has major impact on formation of the country’s Utilization of existing technical and main social and economic indicators. In order for structural potential for improved energy the sector to develop, meet modern challenges efficiency will enable greater balance between and provide sustainable development of the production and utilization of energy resources country’s economy, the government is and significantly reduce greenhouse gas conducting a policy that aims to maximize the emissions without compromising high rates of efficiency of energy resource utilization and the economic growth. These goals will require potential of the energy segment. creation of adequate incentive mechanisms to Energy preparedness and environmental promote energy efficiency among power safety, as well as energy and budget efficiency vendors and consumers. are the cornerstones of long-term government I am absolutely convinced that the 2009 energy policy. A key condition for achieving them National Human Development Report for the is formation of an adequate, modern regulatory Russian Federation will be of interest and help to system, which could provide stability, as well as a wide variety of politicians and officials, a proper legal environment and dynamic scientists and journalists, as well as to all those development of both the energy market and the who are concerned about the development of fuel & energy