Russian energy exports could decline by $179 bln by 2035 due to energy transition – Sberbank chief

VLADIVOSTOK. Sept 3 (Interfax) – Russian energy exports could decrease by $179 billion by 2035 and by $192 bln by 2050 as a result of energy transition, Sberbank chief Herman Gref during a panel session at the Eastern Economic Forum (EEF), citing the lender’s research.

In particular, the energy transition (if it happens) could lead oil and gas condensate production in Russia by 2050 to decline by 72%, while gas output falls by 52%, and thermal coal output by 90%. "I will immediately stipulate, we’re talking about direct use of these fuels in the form of energy sources. If we manage to make two maneuvers (and we have to do it): first of all, to develop other ways of processing – meaning gas chemistry and petrochemistry, and turn these technologies into more environmentally friendly ones, then we’ll be able to see other figures," Gref said.

The achievement of global carbon neutrality may also affect the Russian budget and household incomes. According to Sberbank calculations, Russian budget losses due to the shortfall in oil and gas revenues could reach about 5 trillion rubles by 2035, and the decline in household incomes could reach 14%.

In summary, Gref identified six main risks of the energy transition for Russia: a drop in export revenues, reduced employment, increased problems for single-industry towns, the potential loss of Russian leadership in the global energy industry, the loss of budget revenues, the potential problems of energy companies in the absence of transformation and their possible bankruptcy.

Achieving global carbon neutrality by 2050 will cost the world $140 trillion, or 3% of global GDP per year, Gref said.