1. What electricity storage projects have been commissioned in your jurisdiction to date?
There are two hydroelectric pumped storage power plants in operation in Russia: the Stavropolskaya GAES in the Stavropol region (15.9 MW, commissioned in 1969) and the Zagorskaya GAES in the Moscow region (1,200 MW). The Zagorskaya GAES was first commissioned in 1987, with full operation achieved in 2000. The power plants are owned and operated by the state-controlled company RusHydro, which owns the majority of hydroelectric power plants in Russia. The Russian state holds a 66% stake in this company. The Zagorskaya GAES provides peak-smoothing services for the Moscow power system, while the Stavropolskaya GAES serves essentially as a seasonal water level regulation in the local irrigation system.
There were reports on the eventual implementation of several pilot projects of electrochemical (lithium-ion, hybrid) energy storage of minor capacity by the Federal Grid Company (FSK EES, a state-controlled transmission company), but information about their actual realisation is not available.
Two pilot projects of lithium-ion and lead-acid energy storage (1,800 Ah and 3,000 Ah respectively) are being tested by RAO ES of the East (a subsidiary of RusHydro, which provides electricity to Yakutia and the Far Eastern regions of Russia) as a part of solar-diesel power plants in two isolated settlements of Yakutia (i.e. the Sakha Republic).
2. What electricity storage projects are anticipated in your jurisdiction in coming years?
There are two pumped storage power plants under construction in Russia: the 2nd stage of the Zagorskaya GAES (installed capacity 840 MW, due to be commissioned in 2018) and the Leningradskaya GAES (installed capacity 1,560 MW, currently the construction has been suspended until financing could be found and the project could be restructured). While the Zagorskaya GAES-2 is intended to provide further peak-shaving for the Moscow region, Leningradskaya GAES is intended as a flexibility option for the Leningradskaya nuclear power plant currently under construction in the same region.
RAO ES of the East has expressed more interest in evaluating energy storage options for isolated regions of Russia. Energy storage is being evaluated in connection with the possible replacement of diesel generators in isolated power systems by renewable energy sources coupled with energy storage. The main technologies being evaluated are different electrochemical energy storage technologies, such as lithium- ion and lead-acid systems. The company has concluded memoranda of understanding for the construction of several power complexes consisting of renewable energy sources and energy storage.
Transmission and distribution companies (mainly state-controlled Russian Grids and FSK EES) also show significant interest in the possible ways of using energy storage as a means of enhancing their power transmission effectiveness.
Energy storage as a means of increasing the flexibility of nuclear power plants is also being evaluated by the state-owned State Nuclear Energy Corporation – Rosatom (a state corporation which owns and operates nuclear power plants in Russia and abroad).
Russia’s System Operator (a power system dispatching entity) is studying possible applications of energy storage for ancillary services, such as frequency regulation and spinning reserve.
Industrial and commercial consumers are adopting energy storage as a means of reserve power supply (for example, electrochemical energy storage is used to provide uninterruptible power supply to cellular operators’ towers).
Generally speaking, energy storage is a topic of increasing interest within the Russian power sector and with consumers, and many different possible applications are being considered and assessed.
3. Is there any specific legislation/regulation or programme that relates to energy storage in your jurisdiction?
Currently, there is no specific regulation or programme to support energy storage in Russia. Pumped storage power plants are functioning under a common regulation applicable to the hydro power plants in Russia (with some individual exceptions such as the elimination of capacity payments for the capacity consumed in the pump mode). The projects developed in the isolated regions are subject to government regulation as isolated fully-regulated power systems.
A National Technology Initiative (the “NTI”) implemented pursuant to a resolution of President Vladimir Putin comprises modern power generation, distribution and consumption technologies (the EnergyNet division of the NTI), which includes energy storage applications. The NTI’s goal is to secure an advantage for the Russian industry in the developing sectors in the mid-term. One of the topics being examined under the EnergyNet initiative is the need and the scope of changes required to the Russian legislation in order to better develop energy storage projects.
National development institutions such as Rusnano, the Russian Venture Company and the Skolkovo Institute of Science and Technology (“Skoltech”) have also expressed interest in creating a programme for supporting the development of the energy storage industry in Russia.
4. Please give examples of challenges facing energy storage projects in your jurisdiction and how current projects have overcome these challenges.
as the differences between daytime and night-time power prices in the Russian wholesale power market are relatively small, the economics of pumped storage power plants faced challenges functioning within the standard market regulations. As stated above, a solution was found by modifying the market regulations so that pumped storage power plants would not pay the capacity payments for the capacity consumed during the operation in the pump mode. The capacity payments are a significant part of the total electricity cost payed by the consumers thus, pumped storage power plants have benefited substantially from this regulatory amendment.
Generally, however, due to the relatively early stages of development of the energy storage sector in Russia, there is very little information on major obstacles that market players faced in such projects.
In our opinion, the main challenge for effective energy storage deployment in the centralised power supply zones of the Russian Federation (besides the economic viability of the projects) is the uncertainty in the way the energy storage projects will be treated by the regulators. The Russian legislation in the power sector has been elaborated without energy storage in mind and it sets a clear (sometimes irreconcilable) distinction between power generation and power consumption activities.
In isolated power supply zones, energy storage developers face uncertainties in the technical performance of the different energy storage systems due to the harsh climate. This type of problem may be overcome with the deployment of test/pilot projects, coupled with proper tariff regulation (which affects revenue streams). This is achieved by concluding agreements between the project developers and the local authorities.
5. What are the main entities in the electricity sector and what are their roles or expected roles in relation to energy storage
The Ministry of Energy of the Russian Federation is the main governmental body responsible for developments in the power sector. It coordinates and approves the innovative policies of regulated companies in the power sector, which may include energy storage deployment. The Ministry of Energy is also the body responsible for the elaboration of regulatory amendments in the power sector.
The Market Council is a self-regulated association of wholesale power market participants and is the main body to address and consult in the process of development of the wholesale power market regulation and the amendments needed to accommodate grid-scale energy storage projects.
The Russian state-controlled power sector companies (Russian Grid and FSK EES as the main transmission and distribution companies, System Operator as the dispatching entity, RusHydro, RAO ES of the East and Rosatom as generation companies) all have their own innovative policies, which may include financing of energy storage projects. These companies, as well as the private power sector companies, may also develop economically viable energy storage projects on their own.
The Agency for Strategic Initiatives (the “ASI”) is a non-profit organisation which will coordinate the realisation of the NTI, including the EnergyNet section, described above. The NTI focuses on the development of brake-through industries in the Russian economy, building the relevant infrastructure and legislation, as well as the development of the demonstration, pilot and first commercial projects. The EnergyNet focuses on the development of the energy storage industry as well.
Development institutions, such as Rusnano, the Russian Venture Company, Skoltech and the Skolkovo Foundation are interested in the development of the energy storage industry in the Russian Federation and may participate both in the creation of the roadmaps for this industry and in the development and financing of the test, pilot and demonstration projects in the energy storage sector.