Increasing the generation of carbon-neutral energy is among the most important ways to control climate change. Through our presence in Russia’s wind and solar power markets, we can facilitate the country’s transformation towards a low-emission energy system and drive the change towards a cleaner world.
Fortum is an active participant in renewable energy development in Russia. Our wind portfolio accounts for 50 % of the total volume of wind power plants commissioning in Russia under the acting RES development programme, based on capacity supply agreement mechanisms.
The Fortum-Rusnano wind investment fund has made one of the most ambitious renewable energy commitments in Russia. Following the results of competitive selections of RES investment projects in 2017 and 2018, the Fund won the right to build 1,823 MW of wind capacity (this corresponds to 55% of total wind energy generation capacity in Russia by 2024). Wind farms are expected to be commissioned before 2024.
In January 2018, we added 35 megawatts (MW) of wind power to the Russian power market when our Ulyanovsk wind farm was listed in the registry of capacity. This power plant is Russia’s first wholesale market wind generation facility.
In December 2020, Fortum and the Russian Direct Investment Fund (RDIF) set up a joint venture to invest in the renewable energy sector in Russia and are announcing investments in the acquisition of fully completed and commissioned wind power plants in the Ulyanovsk and Rostov regions with a total capacity of over 350 MW. Fortum and RDIF will continue to actively work on other joint projects in wind and solar energy with the aim of creating one of the leading renewable energy players in Russia.
Today Fortum's and joint venturers wind investment fund’s completed projects include eight wind farms with a total installed capacity of 670 MW. One of these wind power plants, in Ulyanovsk, started operation in 2019. Four wind power plants in the Rostov region and two in Kalmykia started operation in 2020. The four wind power plants in the Rostov region form a wind power cluster that is so far the largest in Russia. The projects with a total capacity of 495 MW are currently in the construction stage in Astrakhan, Volgograd and Rostov regions. The projects with a total capacity of 728 MW are currently in the development stage.
The investment decisions related to the renewable capacities won by the Fortum-Rusnano wind investment fund are made on a case-by-case basis, within Fortum's maximum equity commitment of RUB 15 billion for the development of renewables in Russia.
In November 2017, we signed an agreement to acquire three solar power plants from Hevel Group, Russia's largest integrated solar power company. The transaction was closed in December 2017. All three power plants are operational with a total capacity of 35 MW. The plants were commissioned in 2016 and 2017. Hevel Group will provide operation and maintenance services for all three power plants.
In February 2021, the Fortum-RDIF joint venture made the investment decision to build a 116 MW solar plant in Kalmykia. The first stage of the SPP with a capacity of 78 MW is to be commissioned in 4Q 2021 and the remaining 38 MW in the second half of 2022. When commissioned, it will become the largest solar power plant in Russia.
The solar power plant in Kalmykia will be constructed in accordance with the results of the Russian Capacity Supply Agreement (CSA) auctions held in 2018 and 2019.
With previously made investment decisions, by the end of 2021, Fortum and its joint ventures will deliver 556 MW of CO2-free wind and solar energy to consumers in Russia who are facing rising pressure to address their greenhouse gas emissions.
CO2-free power supply
Fortum is also pioneering the carbon-free energy market in Russia. The agreements signed by Fortum, AB InBev and Unilever in 2018 and 2019 became the first practical steps to meet a demand for green electricity from manufacturers and end consumers in Russia. Under those agreements, Fortum supplies the AB InBev and Unilever production facilities located in Russia with electricity generated by its wind and solar farms. In 2020, similar green energy supply agreements were signed between Fortum-Rusnano joint venture, Sberbank, and Air Liquide.
We see that mitigation of environmental impact is becoming a part of the business practices of many large companies in Russia, and we are happy to offer our customers a tool that enables them to reduce their carbon footprint.