Market liberalization and decarbonization of the Russian electricity industry

Two decades from the start of the Russian electricity sector’s reform, outcomes are disappointing for those who favour liberalization and decarbonization. On the one hand, the swing towards a liberalized market from the former centrally planned state owned monopoly has been reversed; large state-controlled corporations now dominate the industry landscape. On the other hand, the penetration of wind, solar and small hydro has been insignificant by international standards; and yet the established industry stakeholders complain that support for renewables imposes an unfair burden. In short, neither market liberalisation nor decarbonisation of the Russian electricity industry appear currently to be priorities for the country.

By: Alexey Khokhlov , Yury Melnikov

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