It's not all about oil and gas, but also metallurgical energy, solar, and even compost
Stanislov Krapivnik is Director of Operations at OPKO Russian Market Partners
As a market, when one uses energy and Russia in the same sentence, most people instantly think of gas and oil. Those in the know may also think nuclear power, of which Russia is one of the world's top three manufacturers.
However, exploring energy on a smaller scale, Russia has incredibly broad energy potential and high demand awaiting only proper market development coupled with local manufacturing. This has the potential to reap vast rewards for any Western company with the wisdom, commitment and foresight to work within this market.
Let us look at three potential markets: localized solar energy, metallurgical electricity, and trash to electricity.
Energy demands throughout Russia are continuing to spike as industrial capacity grows and consumers buy more and more home electronics. As any strong market with a modern work force but with delayed demand (communism and the roaring 90s made sure of that), electronic goodies are on the top of everyone's wish list.
Complicating matters even more is the very vastness of Russia. The Russian land mass is bigger than all of Latin America, from Mexico to the tip of Argentina. In many isolated places, the costs of providing electrical power are prohibitive.
As such, this is an ideal market for localized solar energy, mounted directly on people's houses. The fact that many of these areas are actually quite sunny, even if cold in the winter, only adds to the overall benefit. At present, expensive imports are sold in this market niche that are cost prohibitive to use and thus only playthings for the affluent. With a proper PR campaign directed at the powers that be, this has the potential to achieve government backing, especially if manufactured in Russia.
As a freebie, micro hydropower is also an untapped market in a country full of springs, rivers and creeks. The same manufacturing aspects as above apply.
Then there is the energy potential of heavy industry, especially metallurgical. Metal plants must heat and heat treat their raw material and metallic products, which is done in large gas ovens, producing incredible temperatures and very high gas use rates. Outside of heating the metals, the energy is lost.
Hooking up a water pipe system to these ovens, heating and converting the water to steam and running a local, usually rooftop mounted turbine generator will allow many of these plants to be energy neutral, recouping their costs via production for personal use and the possible onward sale of electricity. Waste heat utilization.
As a whole, this is a growing concept in countries like Germany but one totally unknown in Russia.
Lastly, in this abridged survey let’s look at garbage, which in Russia, as a robust consumer economy is literally drowning. The solution so far has been larger and larger rubbish dumps. Throughout Russia, entire farm fields are disappearing.
However, as land prices continue to rise, this solution is becoming expensive and the Russian government is actively searching for alternatives. Due to vast distances, and a nonexistent culture of recycling, consolidating garbage waste is impractical. As such, incineration and the associated electrical generation are a top-notch solution
Russia has a vast potential in this, to first satisfy internal market demands and then to export product or system solutions. Those who today invest their time and technology here will reap the harvest. Companies like OPKO Russian Market Partners can assist interested investors in gaining and commanding that market share.
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