Oil Billionaire Makes $450m Bid on Russian Solar Ramp-Up

Oil Billionaire Makes $450m Bid on Russian Solar Ramp-UpOil Billionaire Makes $450m Bid on Russian Solar Ramp-Up

Billionaire Viktor Vekselberg is out to prove that solar has a place in Russia, the world’s largest exporter of oil and gas, Bloomberg reported.

Hevel Solar, a venture between Vekselberg’s Renova and OAO Rusnano, plans 22.5 billion rubles ($450 million) of solar farms through 2018 and says diversifying power generation will benefit the country.

At first glance, solar in Russia makes little sense. The country has surplus energy, and the sun barely crests the horizon in midwinter in Moscow. Yet it does shine along the nation’s southern border with Kazakhstan, where Hevel completed its second solar farm in the Orenburg region last week.

Solar energy can help ease the burden on overloaded power lines, while replacing costly and polluting diesel generators in areas off the grid. The plan isn’t to rival oil and gas, rather to deploy solar where it’s most useful.

Hevel built its first solar farm, supported by government subsidies, in East Siberia, where sparse cloud cover provides sufficient sunny days for power generation. The project, which started selling output this year, was the first of Russia’s renewable-energy subsidy deals to produce power for the market.

The country’s annual subsidy auctions, which began in 2013 and focus on solar, wind and small hydropower, show Russia has begun to seek a greater role for clean energy, targeting an expansion of domestic industry as much as environmental protection.

Set up in 2009, Hevel is 51 percent-owned by Renova and 49 percent by state nanotechnology company Rusnano. Vekselberg has moved into technology investments since building his fortune in oil, power and metals.

Hevel, which will complete a third solar farm in July, is in talks with the government to get protection from extreme currency fluctuations. Russia has delayed the next round of auctions to November as discussions continue.