The International Finance Corporation (IBC), part of the World Bank, has signed a cooperation agreement with the Kaluga Region in central Russia to develop renewable energy in the region, the IFC said on its website.
The agreement is the first of its kind the IFC has signed with a regional administration in Russia,” the IFC said.
“The IFC Russia Renewable Energy Program is helping the Kaluga regional government to analyze the region’s renewable energy potential, pinpoint technology gaps, and identify investment opportunities,” IFC said in a statement.
“IFC also will help Kaluga develop a regional legislative framework that will support investment into renewable energy and serve as a model for other regions.
Russia is the fourth-largest emitter of greenhouse gases in the world. Its energy intensity (energy used per unit GDP) is among the highest globally while its existing generation assets are nearing the end of their technical lives.
The Russian government has set a target of 4.5 percent for renewable energy generation by 2020, up from less than 1 percent now. If this goal is realized, it could create a $20 billion market for renewable energy in Russia.
“Renewable energy is a cost-effective alternative to fossil fuels in many regions of Russia, and IFC can help the regions play a role in the development of a national renewable energy market,” IFC Director for Europe and Central Asia Tomasz Telma said.
“Russian regions working to make an effective transition to renewable energy sources can also help reduce global greenhouse emissions.”
The Director of IFC Russia’s renewable energy program, Patrick Willems, said last November that the IFC was ready to allocate over $150 million in loans to finance the development of renewable energy sources in Russia.