We live in difficult times when geopolitical tension is growing, profound shifts are taking place in public consciousness and technology. The world is entering a new phase of uncertainty, a structural restructuring of economic, social and political institutions is taking place, their roles and narratives are changing. Russia is at the center of these processes, and this is not an exaggeration. To take its place in the new world, the country needs new solutions taking into account the tectonic shifts that are taking place before our eyes. These new decisions must have a deep scientific basis and be based on knowledge of the fundamental laws of development.
Based on materials from the V Moscow Academic Economic Forum (MAEF-2023, Moscow, Great Hall of the Russian Academy of Sciences, June 7, 2023)
Experts:
Igor Anatolyevich Ermakov,
Director of the Strategic Management Department of the State Corporation Rosatom
Stepan Nikolaevich Kalmykov,
Vice-President of RAS, scientific director of the Faculty of Chemistry of M.V. Lomonosov Moscow State University, academician of the Russian Academy of Sciences
Anton Lvovich Maksimov,
Director of the Institute of Petrochemical Synthesis named after. A.V. Topchiev of RAS, Corresponding Member of RAS
Boris Nikolaevich Porfiryev,
scientific director of the Institute of Economic Forecasting of RAS, co-chairman of the MAEF program committee, vice-president of the VEO of Russia, academician of RAS
Rosatom’s plans
Ermakov: Rosatom’s contribution to the Russian economy is obvious, but what is more important is that, in addition to business priorities, we are actively focusing on government tasks, including ensuring the economic and national sovereignty of our country.
The core of our activity is, of course, nuclear energy. If we analyze the prospects for the development of the world market, then I think nuclear energy, which has been developing since the early 1950s of the last century, will exist for many centuries and millennia. If we look at the closer horizon until 2050, the growth is expected to be approximately one and a half times. At the same time, our main competitors are not only traditional players — the USA, European companies, but also actively developing companies in the Asian region — Korea, China. Perhaps new players will appear on the horizon in the coming decades. We cannot afford to rest on the laurels of the Soviet nuclear industry and must actively move forward and stay ahead of our competitors.
In terms of the development of nuclear technologies, we not only traditionally ensure the energy security of our country and a stable energy supply to our economy, but we are also actively developing nuclear technologies using both thermal and fast neutrons, moving towards two-component nuclear energy. A number of scientific projects are also being implemented for a longer term, including in the field of thermonuclear technologies.
About modern technologies of generation 3+: the VVER 1200 reactor was developed taking into account all safety requirements after the events at the Fukushima nuclear power plant in 2011. The use of modern approaches and materials made it possible to increase the reactor power while maintaining the weight and size characteristics.
Of course, the development of nuclear power plants based on thermal neutrons remains the basis for the development of nuclear energy, and if at the first stage we move towards unification and optimization of design solutions, then we move on to the development of two-component nuclear energy, that is, mixed nuclear power plants based on thermal neutrons and nuclear power plants based on fast neutron base with both sodium and lead coolants. This is what will ensure the leading role of Rosatom and our country for decades to come.
Within the borders of the Russian Federation, the share of nuclear energy is now about 20%. The President has set the task of reaching the level of 25% in the structure of the Russian energy balance by 2045. We have a developed strategy, approved by the state corporation, it is the Nuclear Energy Development Strategy until 2050 and beyond until 2100. We understand what reactors, what types, and approximately in what regions need to be built to ensure and achieve the set goals. In this case, we are talking not only about reactors of traditionally high power, gigawatts or more, but also about the development of a line of medium and low power reactors.
We are developing low-power nuclear power plants based on RITM-200 reactors, which are already in operation on our nuclear icebreakers on the Northern Sea Route. We develop both low-power floating nuclear power plants and land-based nuclear power plants. And this is a potentially very attractive product for the global market, which can be used to supply energy to remote regions, isolated production facilities or mining enterprises. And this applies not only to the Russian Federation. Quite a lot of countries have expressed interest in this product.
Rosatom now is not only nuclear energy or the nuclear industry. Yes, these industries now make up about 65–70% of our revenue structure, but we are actively investing and developing related areas of activity, including those areas that grew out of the nuclear industry. This is the development of year-round navigation along the Northern Sea Route, the development and implementation of environmental solutions, including in the processing and management of industrial waste of the first and second hazard classes, and a large set of projects in the field of digital technologies.
It is no secret that in 2022 a number of large global companies limited the supply of software products on which Russian enterprises traditionally operated, and Rosatom plays an active role in their import substitution in the widest range of information technologies. In addition, Rosatom is traditionally strong in power engineering. The state corporation includes the machine-building division Atomenergomash. But we are also looking at a number of other directions, which may not yet be openly discussed.
In addition to nuclear energy, Rosatom is also actively developing wind energy, one of the areas of green energy with minimal greenhouse gas emissions.
It is important to note the development of nuclear medicine: from the production of equipment and tomographs to the creation of medical isotopes, radiopharmaceuticals, and the provision of medical services in radionuclide therapy and nuclear medicine centers. This will have a direct impact on life expectancy by treating cancer and reducing mortality.
There are a number of other areas, one of which is the development of storage devices for electric vehicles. Rosatom, as a supplier of energy solutions, is, of course, one of the main players in this area.
New generation nuclear energy: solving economic and environmental problems
Kalmykov: We understand perfectly well that energy itself is one of the areas of the economy that not only pollutes the atmosphere with greenhouse gases, but is a pollutant in itself. And solving environmental problems related to energy is the most important task.
On the one hand, we want to live comfortably. The comfort and development of the state and the economy as a whole depend on the production of electricity. On the other hand, we always say that we must somehow control the production of electricity, because it is associated with environmental pollution. So far, no one has canceled the OECD standards that are striving for emissions of 50 grams of CO2 equivalent per 1 kilowatt-hour of electricity generation. Now for coal it’s 800g, for gas it’s 500g and so on. We have 5 so-called green energy sources, only 2 of which are highly concentrated, without which it is impossible to develop economies. Why are the values not zero in wind or hydrothermal energy? Because we are talking about the full life cycle of a particular object, taking into account construction. For example, a hydroelectric power station means a huge amount of concrete, the production of concrete also causes pollution and CO2 emissions, so zero values are impossible, just like in nuclear energy. These are important things that are directly related to the economics of the process, to the harmonious development of a particular energy source depending on the region. The OECD plans to increase the share of nuclear energy by 55%. Currently, nuclear energy accounts for 30% of green sources.
The most important factor is technological. Probably, for me the availability of infrastructure comes first, primarily for the management of spent nuclear fuel, which in no case should be confused with radioactive waste.
There are two scenarios here. One is a short circuit, when we extract valuable components, primarily fissile components, from the fuel unloaded from the reactor and return them to the energy sector. In this way, we reduce uranium mining, which is also environmentally harmful, and use what we have left after processing. But this requires complex infrastructure and technology. And the second is what we have now — an open cycle, one-time use, in which it is necessary to constantly extract new uranium, produce fuel from it, and what is unloaded is perceived in this case as radioactive waste, useful components are not extracted from there.
The problem of spent fuel is a separate problem. By not reprocessing spent nuclear fuel and accumulating it, we leave to future generations a legacy that will last hundreds of thousands of years, and in Europe they say even a million years, and will pose a certain danger. How can we reduce this time? There are modern radiochemical technologies for deep fractionation and separation of various components from spent nuclear fuel; as a result, their radioactivity becomes less than the radioactivity of uranium deposits, and then the waste can be safely buried in repositories. This is where chemistry, new engineering solutions, and new technologies are needed. If in everyday life we have to sort household waste, then here sorting is a high-tech process when we sort components depending on their physical and chemical properties, half-life, nuclear chemical properties, what they turn into, etc. As a result, we move from a million years of dangerous storage to 300 years of safe storage. It is both environmentally friendly and economical.
Now Rosatom, in collaboration with other organizations, is developing new methods of deep processing and fractionation. The MBIR reactor will be a reactor with record neutron flux characteristics. We are creating two-component nuclear energy using fast neutron reactors, which actually produce raw materials for us, in combination with thermal energy using thermal neutrons, which generates cheap electricity. The result is a double-circuit module, which solves the problem of raw materials and electricity generation.
At the same time, we are still resolving the issue of uranium mining. Uranium production in the Soviet Union was 16–18 thousand tons per year, in Russia — about 3 thousand tons. The world’s total supply of uranium raw materials is about 60%. If we do not develop and implement the concept of two-component nuclear energy with fast thermal neutrons, after some time, estimates of which vary, we will be faced with a shortage of raw materials for traditional energy with an open nuclear fuel cycle.
And in conclusion, I would like to note that for any electricity producer, for any raw material, environmental issues are unprofitable. We must honor Rosatom for it takes very seriously how waste will be disposed of, where it will be, and how safety will be ensured for these years. There are a lot of programs dedicated to this.
And of course, we need strategic planning, we need to end the unspoken debate between supporters of traditional and green energy sources. It all depends on the specific region. Just imagine some industrial giant like “Norilsk Nickel”, which consumes, in my opinion, 1.4–1.6% of the total output in the country. Well, what alternative sources could there be? This means that there must be a highly concentrated source of energy that will provide such large industrial areas and cities.
On the other hand, we have Krasnodar region, where there are a huge number of households. Modern technologies for creating solar panels are rapidly developing, it is becoming profitable, the cost is falling, their efficiency is increasing, and there this is economically interesting, including for small farms that can use this technology. Therefore, it is very important, based on the economic and climatic characteristics of the regions of the country, to make strategic energy planning. Economic development is impossible without highly concentrated energy sources, the most important of which is nuclear energy.
Sustainable development priorities and climate agenda of the early 2020s in the world and in Russia
Porfiryev: We are at the equator of the implementation of the UN 2030 Agenda for Sustainable Development, if we count from 2015, when it was adopted. It is possible to draw some intermediate results. They confirm to us that the goals that were formulated remain relevant and, very importantly, they are inextricably linked. Progress, unfortunately, has been very uneven across countries and continents during this time, and the overall situation looks quite alarming. If we talk about the world as a whole, then out of the 17 sustainable development goals, satisfactory planned progress has not been achieved on any indicator, partial progress has been achieved on 11 goals, regression is observed on 6, that is, more than 1/3 of them.
If we look at the specific layouts for the most important region, which is essentially the most dynamic and largest economic center — the Asia-Pacific region — we see that progress falls short of the planned levels for 2022 almost everywhere, and there is a serious regression in terms of climate goals. Equally important, very little progress is observed in such indicators as the provision of clean water, as well as the conservation of marine biota.
Even industrialized countries, OECD countries, have experienced regression in every 5th goal since 2015. If we talk about a sectoral perspective and turn, for example, to the problem of climate and ecology, then in the post-pandemic years, greenhouse gas emissions throughout the world over the last two years (2021–2022) increased by 7%, and in 2020 — by 5. 4%, we have record figures of approximately 37 Gt of energy emissions alone for this year. If we talk about the forecast for the future, then, according to the International Energy Agency, compared to 2010, for example, in the same Asia-Pacific region, instead of reducing emissions by 45%, which should be achieved during this time, there will obviously be an increase of 16% .
More than a quarter of our population, about 2 billion, still do not have access to safe drinking water, and almost half, 46%, to safe sanitation, causing more than 1,000 children under 5 to die every day. Water is a critical resource. Everyone talks about oil, gas, and nuclear energy, which is, of course, important, but water determines the well-being of people and the economy to a very serious extent.
What are the causes and consequences of the slowdown in the implementation of the sustainable development goals that were formulated by the UN?
The first reason is, of course, the powerful impact of the pandemic. The current crisis has also affected it, and this factor continues to operate. The second reason is the ineffective implementation of sustainable development goals, which are primarily related to the distribution of resources. Here it is important to highlight the incorrect priorities of sustainable development goals. In fact, all these 7 years, and in fact much more, the same goal has been pursued of reducing the effects of climate change. This problem remains top of mind all the time, despite the fact that the situation is changing. There was Covid, its consequences continue to a significant extent, now a geo-economic and geopolitical crisis has arisen, but we see this indicator at the top.
We see the same thing, oddly enough, in corporate policies, which are also largely integrated into the general agenda. According to Fortune, across the 500 largest companies in the world, we observe the most powerful dominance of the climate factor. What does this lead to? Firstly, to colossal hypertrophy and serious underestimation of general strategic risks and the dangers associated with them. Here we are talking about underachievement or inhibition of the implementation of other national sustainable development goals, as well as corporate goals in ESG terms that rely on natural capital.
The next circumstance concerns the underestimation of human capital and the importance of goals associated with it. In fact, the third goal — the problem of quality health — is also being pushed aside.
Does all this mean a decrease in the relevance, for example, of the climate agenda and the very system of values of sustainable development? Of course not. The problem of climate change remains. We are all witnessing this. There also remains economic and geopolitical competition over the pace and agenda of green development. There remain real interests, first of all, the beneficiaries of this policy in the real sector. In 2022, the green economy was the fifth largest industrial sector in the global economy. The maximum figure is in the UK. That is, work to reduce emissions and achieve the goals of the carbon agenda continues, and not only in Europe — we see such a formulation of the issue in China’s 14th Five-Year Plan and in the strategies of many other countries. The same can be seen in the financial sector, where new and very important things appear related to reporting, bonds, and so on. We are talking about a scientific and technological race, the most important arena of which is the green economy.
Of course, the climate agenda is used, if we talk about the international aspect, primarily as a lever of pressure on the Russian economy. We know that. We know about the plans announced by the European Union regarding the use of a transcarbon border tax, although now this topic has become, so to speak, not very relevant. But, as they say, the locomotive is on a siding, and it is not a fact that this tool will not be used. Of course, scientific and technical cooperation, including between our academic circles and our partners, is greatly complicated for well-known reasons. To achieve this, the card of geo-economic crisis has now been played.
But at the same time, this agenda opens up certain opportunities for us that can and should be taken advantage of; it is necessary to pursue our own policies based on national interests, primarily focusing on the quality of life, challenges in the field of technological sovereignty, as well as environmental risks.
An important component is our own low-carbon strategy, which we had to formulate and did. Naturally, now it should be updated. According to the calculations of my colleagues, it should, first of all, be based on the structural and technological transformation of the economy. It is this lever that should provide the main reduction in greenhouse gas emissions. And it is, of course, important to differentiate more specialized measures, on the one hand, by the degree of availability of technology, and on the other, by capital intensity.
As calculations show, we can achieve up to 2/3 of the reduction in greenhouse gas emissions through relatively cheap measures that allow us to turn our shortcomings in technological development into our advantage. We have a fairly large range of technological solutions from which we can choose, which cannot be said about Western countries, because in many ways they have already implemented these solutions and their further actions turn out to be very expensive.
Use of carbon-containing raw materials: possible prospects in the context of decarbonization
Maksimov: I will focus on what is important for the development strategy of oil refining, petrochemistry and gas chemistry which are the three main sectors that use carbon-containing raw materials in Russia and which should become a significant part of our GDP. The main message here is related to decarbonization, which has already been mentioned more than once.
Quitting fossil fuels even by 2050 seems unrealistic. Even under optimimstic scenarios, the world will receive a significant amount of energy using such fuel. But a focus on reducing carbon dioxide emissions in industry and transport will lead to a significant reduction in its amount, primarily in the transport sector. Estimates here vary: from the most pessimistic, tending to zero, to optimistic — 30–40%, but one way or another this is a challenge for oil refining. The second challenge, now for the petrochemical industry, is that reducing the carbon footprint should be associated with a gradual abandonment of the disposal of those chemical and organic wastes that appear and their reuse. This is a recycling of carbon-containing waste. And the third challenge is related to changes in the energy structure as a consequence of decarbonization. Changes in energy flows will lead to the fact that the main energy that we use in chemistry, oil refining, and energy (this is heat) will be replaced by electricity. And this is also a very significant challenge.
If we talk about Russian oil refining, then everything here is good and everything is bad at the same time. On the one hand, we did not have time to complete the modernization and as a result we have a low fuel yield per ton of oil. We still have a large amount of fuel oil, despite major advances over the past 10 years. But we will now be forced to slowly introduce technologies from, at best, friendly countries, but we must honestly admit that they lag far behind the technologies of developed countries. We have a low Nelson index, and this is a problem; we have export-oriented oil refining, and this is also a problem. We don’t need so much oil refining and so much fuel. On the other hand, it is quite possible that unfinished modernization can be considered as a certain untapped resource. Here it must be said that the oil resources themselves are extremely large, and it is impossible to say that oil will run out in the next century. Probably, cheap and light oil will run out, and what will remain first of all is the so-called heavy oil, that is, oil in which there are few fractions that we can easily convert into fuel, and many fractions that are difficult to convert into these products. And the first thing you need to do is learn how to process such heavy oils. Let us note that Russia has such technologies; we are not far behind the world thanks to the Tatneft company (TANECO). A Russian technology for hydroprocessing heavy residues was actually created. If we want to further develop oil refining as a decarbonization industry, using hydrogen here and turning oil from very high With a high yield in motor fuel and petrochemicals, this technology will be just right here. It is completely Russian, and here we have an element of technological independence.
At the same time, we have another interesting option for using this technology, which is associated with a new concept that appeared 6-7 years ago in oil refining. It is called “oil and petrochemicals”. After all, if we switch to electric vehicles, and this is already becoming a close reality, since the latest samples of industrial batteries that the Chinese company promises us by the end of the year are 500 W per kilogram, which means 1000 kilometers without recharging, then in fact the era of conventional fuels, hydrocarbons, for the passenger car industry, may very quickly come to an end.
The question arises: what then should we turn oil into? The answer is: let’s produce petrochemical products. If we know how to process petroleum products into petrochemicals, and for this we need heavy oil refining processes such as hydroconversion, then we can create petrochemical plants of very high capacity and high competitiveness. Such a plant is now being built by our Arab colleagues in collaboration with world leading companies developing their own technologies. They are going to receive 14 million tons of petrochemical products from 20 million tons of oil. A similar plant has already been created in China with a slightly lower output of petrochemical products — 10 million tons out of 20 million tons of oil, but this is much more than the entire production of such compounds in Russia.
The second is a fundamental change in the chemical industry and the creation of new products that can be recycled. Naturally, one of the most important or simple elements is the processing of polymer raw materials. And petrochemical companies say this is becoming part of their strategy. For example, the largest petrochemical plant in Belgium states that somewhere around 20% will be secondary polymers.
Methane and gas chemistry were always considered unprofitable until China implemented the technology for processing coal into olefins. Now the production of olefins from coal (which is more expensive than from methane) is more than 10 million tons, in the near future — 20 million tons, and this is several times more than the entire Russian petrochemical industry. In Russia, such technologies have been developed to the pilot level. They can be implemented for the development of Russian petrochemicals using Gazprom resources.
The next topic that is important: if you and I have electricity, it needs to be used in large-scale industry, but technologically this is quite difficult. Electricity is being replaced by hydrogen as an intermediate energy carrier. There is no need to talk about hydrogen energy, but we need to talk about hydrogen technologies for energy. And hydrogen is becoming a means of decarbonizing industry and a number of modes of transport where hydrocarbon fuels cannot be replaced.
As for the release and use of carbon monoxide, this is a huge industry that is emerging before our eyes. In fact, this is a science that has been developing in the last 15 years, and now it is an industry called biorefining, it arose precisely from the idea that CO2 needs to be fixed with the help of plants. All these technologies can be developed in Russia one way or another, and here we still have a chance not to waste time.
In 20 years, oil refining will look like different feedstocks: not just crude oil and biofeedstocks, but also carbon dioxide and hydrogen, and there will definitely be carbon dioxide capture technologies. For each country that is developing its economy, the ratio of these types of raw materials and the processes that are used will probably be important. We will probably have more oil and more carbon dioxide capture and storage processes. In Europe, the creation of fuel based on hydrogen and CO2 technologies will most likely not be in the first place. The same is true for petrochemicals.
