Belarus

Country Profile

2. Policy and Incentives

10. Country Contacts

Disclaimer: This information has been prepared for the European Bank for Reconstruction and Development (EBRD) by Black & Veatch (B&V) and is based on information not within the control of EBRD or B&V. References for information contained in this report are listed at the end of this document; readers should consult these references for original source material. Neither EBRD nor B&V has made an analysis, verified, or rendered an independent judgment of the validity of the information provided by others. EBRD and B&V do not guarantee the accuracy thereof. Use of this information contained shall constitute a waiver and release of B&V and the European Bank for Reconstruction and Development from and against all claims and liability, including but not limited to liability for special, incidental, indirect or consequential damages, in connection with such use.

1. Overview of Electricity Supply

Belarus's transition from communism to democracy proved to be more difficult than expected, economically as well as politically. What had once been a boon to industry in the Belorussian SSR--large volumes of inexpensive oil, natural gas, and electricity from the Russian Republic--quickly became a considerable problem for independent Belarus. Under the communist regime, industry had had no incentive to use fuels efficiently, modernize equipment, reduce pollution, maintain factories adequately, recycle, or allot energy resources efficiently. However, once Russian fuel prices began to approach world levels, Belarusian industry had to adjust in order to survive. Logic would seem to call for enterprises improving their industrial efficiency, but the oil refineries at Navapolatsk (capacity 22 million tons a year) and Mazyr (capacity 18 million tons a year), as well as many enterprises, cut their output instead. The 30 percent drop in energy consumption between 1990 and 1993 was the result of a drop in demand for industrial goods produced in Belarus, partly because of the chaotic state of the Soviet economy in the last years of the Soviet Union's existence, and partly because the Soviet Union no longer needed so many goods for its military.

The country is capable to provide itself with energy resources to meet only 13-15 percent of their demand. The rest has to be purchased mainly from Russia. Belarus has preserved practically all soviet industry in the same form that existed twenty years ago. A Majority of these enterprises use imported resources.

Belarus' electricity demand is about 33-34 billion kWh. Belarusian electricity sector has sufficient capacity to manage without imports. However, the Belarusian energy system generates only 25 billion kWh of electricity and the rest - about 7 billion kWh - is imported from Russia and Lithuania. On February 1, 2004 the Government for the first time stopped the import of Russian and Lithuanian energy, however the negotiations on the renewal of contracts continue.

Belarus spends about US$ 1.8 billion for gas purchase annually while its GDP constitutes about US$ 13 billion. So far Russia has been supplying gas to Belarus for lower than the average world price, approximately US$ 36 per ton in 2003 and about US$ 46.7 per ton in 2004, in comparison: the Baltic countries purchase gas at US$ 80 per ton and European countries at US$ 120 and more per ton.

Belarus Country Summary Table

Demographical Information
Population, millions (2003)	8.3
Land area, thousand Ha (2002)	8,660
Macroeconomic Information (2003)
GDP, billion US$	7.2
Real GDP growth rate, percent	11.20
Foreign direct investment (net), million US$	2,353
Electricity sector
Electricity tariff, US¢/kWh (2002)	2.0
Collection rate, percent (2002)	45
Load utilization factor, percent (2000) Feed-In tariff (Euro/kWh)	NA 0.062
Electricity disposition, billion kWh (2003)
Generation	20.00
Consumption	20.25
Exports	0.70
Imports	2.35
Generation capacity, GW (2003)
Nuclear	0.0
Thermal	4.2
Hydro	1.0
Other renewables	0.0
Total	5.2
Sources: European Bank for Reconstruction and Development, U.S. Energy Information Administration, Food and Agriculture Organization of the United Nations.

The electric system infrastructure has been in a state of continual decay since Belarus achieved independence from the former Soviet Union. Lack of investment in maintenance and renovation has rendered the domestic generation resources incapable of meeting the electricity demand for the past decade. Additionally, the true electric demand is likely much higher than the consumption as frequent system outages and shortages of supply have contributed significantly to the drop in consumption. The inability of domestic resources to meet electric demand, in conjunction with high inflation and artificially low electric tariffs has left Belarus with over $50 million in debt for electric imports from Lithuania and Russia.

Privatization has slowly advanced since the split from the Former Soviet Union. To date, only about 10 percent of republican enterprises, and about 40 percent of communal enterprises have been privatized. According to the five-year economic development plan adopted in May 2002, the state will continue to play a dominant role in the economy. At the present time, the government believes that large-scale privatization, including public utilities, would be premature in the current economic environment.

Belarus’ Electicicty Generation (Source: IEA)

The country's power grid is connected to the grids of Lithuania, Russia, Ukraine, and Poland. Most electricity imports come from Lithuania (the Ignalina Nuclear Power Plant) and Russia (the Smolensk Nuclear Power Plant), but even here, Belarus has had problems in paying for its imports. In May 1995, Lithuania resumed electricity exports after more than two years; Belarus agreed to make payment in Russian natural gas.

During the Soviet era, nuclear energy was promoted as an inexpensive source of electricity, but after the Chornobyl accident, many people in Belarus were opposed to nuclear power.

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2. Energy Policy, Barriers and Incentives

On July 7, 2005 the President of Belarus approved priority guidelines of science and technology activity for 2006-2010.

According to the document the priority guidelines include alternative and energy-efficient technologies for competitive production, new materials and energy resources, medicine and pharmacy, information and telecommunications technologies, technologies for production, processing and storage of agricultural products, industrial biotechnologies, ecology and rational nature management.

According to the information provided in the presidential press service, the program is based on the concept of the socio-economic development program of the Republic of Belarus for 2006-2010 and other documents. Innovation practice of the developed countries with the priority given to the EU and Russia was also taken into consideration.

In 1994 Belarus introduced a standard feed-in tariff for renewable generated electricity in a law modeled on Germany's Electricity Feed Law. Renewable electricity will be bought for about USD 0.08/kWh compared with a consumer price for electricity in of just USD 0.012/kWh. The governments of Germany and Belarus have said that they want to promote alternative energy sources.

Additional energy policy, barriers and incentives include:

· All renewables – “Ordinance on Setting and Applying Prices and Rates of Electric

· All renewables- Absence of competitive financing mechanisms

· Wind - In 1994 Belarus introduced a standard feed-in tariff for renewable generated electricity in a law modeled on Germany's Electricity Feed Law, a fixed feed-in tariff of USD 0.08/kWh

· Solar- The climate is not favorable for the application of any large scale plants

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3. Wind

A country wide wind-atlas is available, where 3 main areas with annual average wind speeds of 4 - 5 m/s at 30 m height were identified.

Belarus has a poor potential for wind energy development from a technical point of view, but there are strong legal and economical incentives. The “Master Plan of Wind Power Development of the USSR till 2010”, published in 1989 included a country-level wind map. The resource potential was estimated for 30m above ground. According to this wind map, there are no areas with a wind speed more than 5 m/s at 30m above ground.

These results imply a relatively poor wind resource at 30 m, however new studies need to be conducted with state of the art wind measurements of heights at least at 50 m above ground, closer to the height of capture for a wind turbine.

The most promising sites are Minsk and westwards of the country, the towns of Vitebsk and Polotsk in the Southern region of the country. The first two turbines are installed in Druzhnaya, about 150 km north of the capital city of Minsk.

Wind Atlas of Belarus (Source: United Nations)

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4. Biomass

Belarus is very well suited for biomass energy development due to large area of productive industrial forest, flat landscape, well developed power distribution and district heating infrastructure, and technically adept society. In a study conducted by the Institute of Power Engineering Problems in Minsk, data collected on quantification of wood biomass fuels (forestry debris, fuel wood and woody waste generated as a result of different types of felling and lumber processing) show that biomass energy in Belarus may have annually available about 1.5 million t.e.c. now and up to 2.7 million t.e.c. by 2015. If energy crops are also considered, this may provide an additional 1.2 million t.e.c. per year.

The most significant renewable energy source in Belarus is wood. At present 461 boiler plants are operating in Belarus Republic using the combined combustion of wood and other types of fuel. A large range of water-heating boilers with capacity from 60 to 5000 kW utilize wood fuels in Belarus.

Biogas obtained from animal husbandry wastes is another renewable energy source in Belarus. In 1992 the first biogas plant “Kobos” was commissioned in Republic. It was designed and manufactured similar to West European plants. Its productivity made up 500 m³ of biogas a day with cattle manure 50 m³/day.

There are in the Republic 275 livestock breeding plants and 66 poultry breeding factories, where it is annually possible to produce 1.7 billion m³ of biogas (0.9 million toe)

Belarus Biomass Resource Data

Biomass resource type	Total production	Production density
Percent of total land area covered by	3%
Forests	0%
Shrublands, savanna, and grasslands	95%
Cropland and crop/natural vegetation mosaic	0%
Urban and built-up areas	0%
Sparse or barren vegetation; snow and ice	1%
Wetlands and water bodies	3%
Primary crop production, tonne	(avg. 1999-2001, tonne)	(tonne /1000 Ha)
Total primary crops (rank among COO)	53,361,633 (5)	2,572 (8)
Top 10 primary crops
Mixed Grasses, Legumes	22,566,667	1,088
Maize for Forage & Silage	11,733,333	566
Potatoes	8,302,933	400
Vegetables and Roots, Fodder	2,662,333	128
Barley	1,501,567	72
Sugar Beets	1,380,033	67
Rye	1,222,633	59
Wheat	803,467	39
Cabbages	527,100	25
Oats	486,500	23
Animal units, number	(number)	(number / 1000 Ha)
Cattle	4,505,850	217
Poultry	30,000,000	1,446
Pigs	3,632,200	175
Equivalent animal units	6,258,730	302
Annual roundwood production	(1996-98, 000 m³)	(m³ / Ha)
Total	17012	819.9
Fuel	809	39.0
Industrial	16203	780.9
Wood-based panels	386	18.6
	(1996-98, 000 metric tons)	(metric tons / Ha)
Paper and paperboard	206	9.9
Recovered paper	NA	NA

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5. Solar

At present the use of solar power is minimal. There are only a few example applications of solar water-heating plants on the basis of flat solar collectors.

The climate conditions in Belarus are on the whole unfavorable for solar energy. The relatively poor potential is characterized by the data below for Minsk, the capital, and Vasilevichi, located in the Southeast of the country. The data below indicates that there are no regions with high technical potential for solar energy in Belarus. The main opportunity for solar applications is the use of flat modules, including flat thermal collectors, flat photovoltaic arrays, and is most practical in the summer time.

Monthly and annual total solar radiation incident on horizontal surface, MJ/m²

Location	Minsk	Vasilevichi
Jan	69	86
Feb	133	145
Mar	291	295
Apr	393	402
May	567	570
Jun	624	623
Jul	590	613
Aug	478	505
Sep	315<