Strategy for the Energy Transition to a Carbon-free Economy: Real

Opportunities and Prospects

Guzel Strekalova

, Salman Kurbanov

and Sofia Strekalova

Kazan National Research Technological University, Kazan, Russia

Kadyrov Chechen State University, Grozny, Chechen Republic, Russia

Arbuzov Institute of Organic and Physical Chemistry, FRC Kazan Scientific Center of RAS, Kazan, Russia

Keywords: Energy transition strategy, carbon-free economy, new energy source, electric car, ecology, opportunities,

prospects.

Abstract: The topical issues of the Russian economy development focused on the prospect of producing new types of

energy resources and new types of «green» fuel for eco-transportation, providing the highest environmental

standards, have been considered. The program «Carbon-free economy-2030» adopted by the European Union,

according to which hydrocarbon fuel is supposed to be abandoned by 2036, has been analysed from the

standpoint of challenges for the Russian economy and determining the strategic prospects for its development.

Russia has chances to become a leader of the «blue hydrogen» market, and in the top five countries developing

the production of eco-fuel, Russia is not in the last positions. The main requirement for the realization of

opportunities for the Russian economy are overcoming the stereotype of a resource power and taking a course

towards the development of innovative «green» technologies. The Khanty-Mansi Autonomous Okrug - Yugra,

the Far East, the Leningrad Region and the Republic of Tatarstan can become promising regions for the

implementation of the «carbon-free economy» strategy as regions with high-tech industries, technological

capabilities and a unique base for the effective development of new production complexes and ecosystems.

1 INTRODUCTION

The environmental problems of modern reality,

which include such systemic areas as the conservation

and management of ecosystems on the efficiency

principles, environment cleanliness, improvement of

the water resources management at the system level,

introduction of the renewable energy sources and etc.,

currently remain relevant. A lot of resources of the

world advanced countries are aimed at solving these

problems. Global warming, abnormally warm winters

in the northern part of the globe and abnormally hot

summer months in the equatorial parts of the globe,

the huge atmospheric concentration of carbon dioxide

and associated with it tsunami have become

increasingly threatening to civilization. In most cases

this is due to the high concentration of carbon dioxide

in the atmosphere that prevents the cyclical exchange

of air masses. During the World Climate Forum in

Glasgow the ESG concept and the energy transition

https://orcid.org/0000-0002-1305-1769

https://orcid.org/0000-0002-7940-7895

strategy were adopted. In essence, ESG is a new

concept that reflects the three main principles of

modern companies: environmental principles, social

responsibility principles and management efficiency

principles. The energy transition is a strategy the

content of which is the transition to carbon-free

renewable energy sources. This strategy formed the

basis of the “Carbon-Free Economy” program

adopted by the European Union, which is focused on

abandoning hydrocarbon fuels by 2036

(Kaveshnikov, 2014).

For Russia, as the largest producer of carbon-

based energy resources, this is both a serious

challenge and great opportunities.

So, for example, a new energy carrier «blue

hydrogen», which does not leave a carbon footprint,

can become an alternative energy carrier. In the

coming years, the global blue hydrogen market will

reach about $2.5 billion. The top five countries

developing the production of "blue hydrogen" include

Strekalova, G., Kurbanov, S. and Strekalova, S.

Strategy for the Energy Transition to a Carbon-free Economy: Real Opportunities and Prospects.

DOI: 10.5220/0011554900003524

In Proceedings of the 1st International Conference on Methods, Models, Technologies for Sustainable Development (MMTGE 2022) - Agroclimatic Projects and Carbon Neutrality, pages

73-78

ISBN: 978-989-758-608-8

 2023 by SCITEPRESS – Science and Technology Publications, Lda. Under CC license (CC BY-NC-ND 4.0)

Russia that has every chance of becoming a leader in

it.

Nowadays, the demand for hydrogen reaches 70

million tons per year. The main raw material

component in the production of hydrogen is natural

gas used in the technological process of the methane

conversion vapor phase. This technology is applied to

the production of ammonia and methanol. Annually,

205 billion cubic meters are spent on hydrogen

production. Most enterprises that use hydrogen

produce it themselves using specialized facilities. It

should be noted that hydrogen is not an energy

resource and therefore there is no global market for

its production. However, it is important to note that

hydrogen is a secondary energy carrier, and its

production will require additional energy costs that

will certainly affect the growth of costs and prime

cost. The main areas of hydrogen application are

transportation and energy. According to Hydrogen

Consulting (Association of Hydrogen Producers), the

share of hydrogen in the global energy market by

2050 will be up to 25% (Grib, www.ngv.ru).

Global environmental problems have many

directions for their solution. Equally important of

these are the problems associated with greenhouse

gases destroying the Earth's ozone layer that can lead

to catastrophic consequences. In this regard, another

direction of the systemic approach of the «green»

economy is the comprehensive development of

«clean» transportation (Aniskov, plus-one.ru).

Thus, in modern conditions, the strategic issues of

unlocking the potential of the Russian economy and

its development in the direction of creating a carbon-

free economy with the prospect of switching to the

production of a new energy carrier and eco-transport

are being updated.

2 MATERIALS AND METHODS

(MODEL)

In the course of the study, methods of statistical

analysis, economic and mathematical modeling,

analysis and synthesis tools have been used. At the

system level using the materials of the State Statistics

Committee of the Russian Federation, the Republic of

Tatarstan and other Internet materials, an analysis has

been made of the opportunities and prospects for the

development of a carbon-free economy in two

directions: the development of hydrogen energy and

the development of the Russian automotive industry

using environmentally friendly fuel and vehicles from

the standpoint of eliminating emissions into the

atmosphere. The prospects for the development of a

carbon-free economy are dictated by time and the

speedy solution of global environmental problems.

3 RESULTS AND DISCUSSION

The European Commission, which published its

strategy for the development of hydrogen energy

resources [Building a hydrogen economy for a

climate-neutral Europe] in July 2020, announced the

creation of the Clean Hydrogen Alliance. The

presented strategy outlines the main stages and

directions for the hydrogen energy development

(European Commission, ec.europa.eu).

If we return to the origins, there are three types of

hydrogen: «gray», «blue» and «green». This is the

same hydrogen, the difference lies only in the

production methods.

Coal is the main raw material for producing

«gray» hydrogen. However, its production doesn't use

technologies for capturing or storing carbon dioxide

generated during the production process, that is, it

doesn't use effective encapsulation methods, and, as a

result, carbon dioxide enters the atmosphere and

pollutes it.

Methane is used in the production of «blue»

hydrogen. However, this production method has not

found wide application due to the explosive nature of

the raw material, but remains promising for the

industrial hydrogen production.

The safest and most common method for

producing hydrogen is water electrolysis. This

method produces «yellow» and «green» hydrogen.

But even here there are subtleties, for example, in the

case of «yellow» hydrogen, nuclear energy serves as

an energy source, and in the case of «green»

hydrogen, energy obtained from renewable sources,

that is, from sources of recycled energy.

According to the strategy for the development of

hydrogen energy resources, at the first stage, by 2024,

it is planned to reach the goal of producing one

million tons of renewable hydrogen using an electro

laser with a capacity of at least 6 GW. At the second

stage, from 2025 to 2030, it is planned to increase

productivity to 10 million tons per year using a

capacity of 40 GW. According to the German

hydrogen strategy, the demand for hydrogen will

increase to 100 TWh, of which 14 TWh (about 0.4

million tons) is planned to be produced by the

electrolysis, and the rest (76 TWh) is proposed to be

produced from natural gas. The main consumer of

German hydrogen will be the metallurgical industry

with demand up to 10 TWh by 2030 and up to 80

MMTGE 2022 - I International Conference "Methods, models, technologies for sustainable development: agroclimatic projects and carbon

neutrality", Kadyrov Chechen State University Chechen Republic, Grozny, st. Sher

TWh by 2050. «Thyssenkrupp Steel Europe»

company in January 2021 published a feasibility

study on the possibility of providing a steel-casting

factory with hydrogen generation based on blue

hydrogen. The generation price will be 58 EUR/MWh

(BMWi, www.bmwi.de).

The main indicator that determines the economic

feasibility of the technology for the production of

«blue hydrogen» is the cost of its production.

Let's conduct an expert assessment of the cost of

«blue» hydrogen according to the formula (1):

(Цact•Qact)/Р + CsQact +Qen•Цen = Цav (1)

where: P – density ≈ from 1.5 $/kg to 2 $/kg

The mass of 1 litre of hydrogen or hydrogen vapor

at a temperature of 0 degrees C and a pressure of 760

mm. = 0.1 kg ⇒ production cost of 1 litre of hydrogen

= 0.2 $. This indicator convincingly proves the

economic feasibility of the production of «blue»

hydrogen in Russia.

Today, hydrogen energy is actively developing in

five countries of the world, which include, first of all,

The UK, Germany, the USA, and China. Russia

closes the top five countries developing the

production of blue hydrogen. The cost of yellow

hydrogen (the least environmentally friendly) in

Germany is 9.50€ ≈ 11.21$.

Today, the global hydrogen market is 1.8 trillion

euros, and in the coming years it will reach 2.5 trillion

euros. According to the optimistic assessment

scenario of the Hydrogen Council (an association of

large international companies, which includes Total,

Toyota, BP, Shell and other corporations, mainly

European and Japanese), in 2050 the share of

hydrogen in energy consumption will be 18%.

Summing up, we can say that Russia has every

chance to take a leading position in the «blue

hydrogen» market, having raw materials for this.

Let's consider the features and prospects of

hydrogen energy in Russia and its regions, especially

in those regions where high-tech industries are

concentrated, there are technological capabilities and

a unique base for the effective development of new

production complexes and systems (Strekalova,

2020).

In connection with the global trend towards ESG,

as well as the global change in demand from the main

Russian importers of energy resources - the European

Union, the Russian Federation has put forward its

strategy until 2035 - «Energy Strategy of the Russian

Federation - 2035». The strategy considers Russia's

global energy transition and its role in this process.

According to the strategy, already in 2014, the

Russian Federation was able to export 200 thousand

tons of hydrogen energy, and by 2035 it is able to

increase the export volume to the level of 2000

thousand tons of hydrogen energy. In the domestic

market, hydrogen consumers will be environmentally

friendly vehicles, including hydrogen cars, electric

vehicles and many other companies that have adopted

the ESG strategy. The development of production

chains of hydrogen energy provides for the creation

of «hydrogen clusters».

Three regions of Russia expressed interest in the

hydrogen production: the Khanty-Mansi

Autonomous Okrug - Yugra (KhMAO-Yugra), the

Far East and the Leningrad Region.

There are two gas processing plants in Khanty-

Mansi Autonomous Okrug - Yugra: Balyksky (Sibur)

and Yuzhno-Priobsky (Gazprom). Both of these

plants underwent modernization in 2020. In Khanty-

Mansi Autonomous Okrug - Yugra, 40% of all

Russian oil is produced by the three largest energy

companies in Russia: Rosneft, Lukoil and

Gazpromneft. Until recently, oil itself was the main

extracted raw material, but recently the production of

associated raw materials (associated petroleum gas)

has begun. In addition, in Siberia, of which Yugra is

an integral part, the main production of natural gas is

carried out. The combination of these factors makes

the region very convenient for creating a hydrogen

production plant in it. Technically, this can be done

on the basis of two gas processing plants, and in the

future, ready-made hydrogen will be delivered to the

consumer through pipelines. The construction of gas

pipelines is similar in cost to the construction of a

hydrogen pipeline, that is, it is possible to create a

production cluster almost directly on the production

site.

The second promising region for creating a

hydrogen cluster is the Far East.

The convenience of this region lies in the fact that

there are two large industrial countries next to it -

Japan and China with a huge consumer market.

The third promising region is the Leningrad

region. A huge gas cluster, which combines gas

processing, gas chemistry and natural gas

liquefaction, has been built in the Leningrad Region

in Ust-Luga. This region is promising both in terms

of the existing infrastructure and in terms of

consumers.

Firstly, the hydrogen production in this region can

cover with its products the two most densely

populated districts of our country - the North-Western

and Central, as well as the two largest metropolitan

areas - St. Petersburg and Moscow.

Strategy for the Energy Transition to a Carbon-free Economy: Real Opportunities and Prospects

Secondly, a large volume of industrial production

is concentrated in St. Petersburg, as well as large

financial and exchange organizations, such as VTB,

the St. Petersburg Stock Exchange, which indicates a

large number of people with an income above the

average (population - 5,376,672 people, regional

gross product - 4.478 trillion rubles). The average

salary, according to Rosstat, is 61,572 rubles. There

are more than 60 higher educational institutions in the

city, which testifies to the high level of people

education. At the same time, the ecological situation

in the city, as in any metropolis, is not the most

favorable; there is a large number of emissions of

harmful substances into the atmosphere, soil and

hydrosphere (Rosstat, petrostat.gks.ru).

The situation is similar in Moscow. The

population of Moscow is 12 632 409 people, the gross

regional product is 20000,5 billion rubles. There are

118 universities in Moscow that also indicates a large

number of educated people and, like in St. Petersburg,

there are many environmental problems. The

combination of these factors gives reason to believe

that the popularity of environmentally friendly cars

will be high, and the Russian government is already

creating conditions for this. The development strategy

published by the government states that from 2030,

every fifth imported car in Russia must be

environmentally friendly (N 1523-p, 2020).

Among the promising regions, in addition to those

listed, are Tatarstan.

The Republic of Tatarstan has the most

diversified economy - the petrochemical industry,

mechanical engineering, agriculture, information and

telecommunication hubs - this is not a complete list

of industries that the Republic has and in which it

occupies a leading position in Russia. The

petrochemical complex is represented by a full cycle

- from production to processing. The basis of the

republic's oil refining is the Taneco plant in

Nizhnekamsk, which is a petrochemical cluster that

produces gasoline of all grades, aviation fuel, sulfur,

petroleum coke and many other products. In July

2021, the launch of new technological units took

place: gas fractionation, catalytic isodewaxing of

diesel fuel, the second delayed coking unit in a row,

which gives huge advantages in creating a hydrogen

cluster and switching to ecological fuel in Tatarstan.

Looking ahead, we note that there are two main

types of electric vehicles: charging directly from the

grid and using hydrogen as fuel. The plug-in electric

car runs on large on-board batteries, while Tesla's

most advanced electric car currently charges in about

6 hours to a full charge (with the right infrastructure

in place). The device of a hydrogen electric car is in

many ways similar to the device of a standard electric

car: the same engine is of an electric type, but the

engine battery is powered not from the grid, but from

hydrogen released as a result of a chemical reaction.

Hydrogen filling stations can potentially be created

on the basis of Tatneft's infrastructure, which has a

developed grid of filling stations in the Republic.

However, this will require the development of

appropriate projects focused on ensuring the safety of

transportation and storage of hydrogen fuel, since it is

explosive. If we consider from a technological point

of view the reality of obtaining any of the listed

hydrogens, then the most promising for Russian

practice is «blue» hydrogen from methane. A

successful solution to the production of «blue»

hydrogen will require the development of

technologies and the choice of the most efficient and

less costly alternatives. There are gas processing

plants in Russia, for which a decision can be made

regarding the organization of the production of

«blue» hydrogen. The most profitable option is a gas

processing plant in the Khanty-Mansi Autonomous

Okrug. The advantage of these plants is that

associated petroleum gas is also formed during oil

production. It is from associated petroleum gas that

hydrogen can be produced and delivered directly

through pipelines to distribution grids, including

export to other countries.

The Republic of Tatarstan is the best region to

start the energy transition process in Russia. The

average salary in Tatarstan is 31,543 rubles, the GRP

of Tatarstan for 2020 amounted to 2.4 trillion rubles.

There are more than 60 universities in the Republic,

which indicates the education of the population, but

most importantly, the leadership of the Republic

supports the trend towards environmental education

of residents, especially children. The Ministry of

Ecology of the Tatarstan Republic has created such

projects as «It will be Clean», which is aimed at

attracting young people to study the environmental

problems of their native land, environmental clean-up

days are held, residents take an active part in

environmental reviews of any major project in the

Republic. Nowadays, electric cars can already be seen

on the roads of Kazan that indicates the desire of

residents to purchase environmentally friendly cars

(tatstat.gks.ru).

Let's consider a possible transition of the Russian

automotive industry to an electric car that is

environmentally friendly in terms of eliminating

emissions into the atmosphere and dwell on its

advantages from an economic point of view. Let's use

the Avtostat data, according to which the average car

MMTGE 2022 - I International Conference "Methods, models, technologies for sustainable development: agroclimatic projects and carbon

neutrality", Kadyrov Chechen State University Chechen Republic, Grozny, st. Sher

mileage per year in Russia is about 18.000 kilometers

("Avtostat", www.autostat.ru).

Let's carry out a comparative analysis on the

example of two vehicles of the same manufacturer:

Nissan Note (gasoline) and Nissan Leaf (electric car)

according to the maximum similarity of objects.

A car with a gasoline engine in the urban cycle

consumes approximately 8.8 litres of gasoline per 100

kilometers. With the cost of gasoline on average 60

rubles per litre, the cost of refueling per year will be:

8.8 ∙ (18,000 / 100) ∙ 60 = 95,040 rubles.

An electric car consumes approximately 35 kWh

of electricity per 120 km in buildup areas, that is, in

this scenario, the average consumption of "eco-fuel"

will be 42 kWh per 100 km. Taking into account the

cost of a kilowatt of electricity in Kazan equal to 4.11

rubles, the cost of charging an electric car per year

will be: 42 ∙ 180 ∙ 4.11 = 31071.6 rubles.

The difference of 63,968.4 rubles testifies in favor

of an electric car, refueling of which, all other things

being equal, is 3 times cheaper. Of course, the

calculations are preliminary, and if we took them into

account, we would have switched to the production

and operation of electric cars as an environmentally

friendly mode of transport long ago. The following

figures can be added: CO2 emissions from an electric

car will be 2 times lower than from a gasoline car after

200 thousand km of run (Maltseva,

www.vedomosti.ru).

Thus, in terms of cost, an electric car is preferable

to a car with a gasoline engine.

Other benefits of an electric vehicle include:

- Safety for the environment: zero exhaust means

that the surrounding air is not polluted by exhaust

gases and becomes cleaner;

- The noise level is minimal: an electric car

produces much less noise than a conventional car and

it becomes more comfortable to live in densely

populated cities;

- Repair and maintenance of electric cars are less

labor-intensive, cheaper and take less time;

- Safety: the center of gravity of the electric car is

shifted down to where the battery is located, electric

cars are more stable and better controlled during

sharp maneuvers.

Of these advantages, one question arises, why,

with such advantages, the conditions for replacing

gasoline cars with eco-cars have not yet been created?

Let's dwell on a number of disadvantages of

electric vehicles:

- The power reserve before recharging is limited:

an average of 210 - 260 kilometers, which indicates

the priority of using only within the city. Of course,

there are models such as the Tesla Model S and Jaguar

F-Pace with more than 550 kilometers on a single

charge, but this is still not enough;

- High cost: even the average budget version of an

electric car has a cost equal to 2.3-2.5 million rubles,

which is 1.5-2 times higher than the cost of

inexpensive Japanese-made cars with a gasoline

engine;

- Dependence on the ambient temperature: the

battery capacity decreases when the ambient

temperature changes, for example, at an air

temperature of 5 °C, the battery capacity decreases by

20%, at -5 °C the decrease is 35–40%, and at -12 °C

by 50%. For the Russian automotive industry this

indicator is important, since low temperatures in

Russia are observed for about seven months;

- Optimization of the microclimate in the cabin:

the air conditioning and heating are powered by a

battery that reduces its capacity. By optimizing the

microclimate in the cabin, battery consumption

increases that leads to a decrease in the power reserve

by 20-25%.

There are also problems associated with the

production of electric batteries, which is quite

environmentally unsafe and economically expensive,

but the decision whether or not to be a «people's»

electric car depends not only on economic feasibility,

but also on the creation of decent living conditions

and the quality of life for the planet's population as

well.

4 CONCLUSIONS

1. Environmental problems are forcing humanity

to switch to new types of energy resources, to

radically reduce harmful emissions into the

atmosphere. Today, hydrogen energy is

becoming a reality and one of the promising

areas for the development of a carbon-free

economy. The global hydrogen market today is

1.8 trillion euros, in the long term it will reach

the level of 2.5 trillion euros. According to the

optimistic assessment scenario, the share of

hydrogen in energy consumption will be 18%

in 2050. The cost of hydrogen production

according to preliminary calculations ranges

from $1.5 to $2 per kilogram. This indicator

convincingly proves the economic feasibility

of the production of «blue» hydrogen in Russia,

which has every chance of taking a leading

position in the «blue hydrogen» market, having

raw materials for this.

2. Russia has the necessary opportunities and

conditions: a resource base, a developed fuel

Strategy for the Energy Transition to a Carbon-free Economy: Real Opportunities and Prospects

and energy complex, a large number of

specialists in order to take a leading position in

this direction, despite geopolitical difficulties.

The Khanty-Mansi Autonomous Okrug -

Yugra, the Far East, the Leningrad Region and

the Republic of Tatarstan can become

promising regions for the implementation of

the «carbon-free economy» strategy as regions,

which have high-tech industries, technological

capabilities and a unique base for the effective

development of new production complexes and

ecosystems.

3. Most of the emissions are produced by road

transport, in this regard it is necessary to

develop manufacturing related to the

production of electric vehicles both on electric

and hydrogen fuels, especially there are

examples of advanced industrial countries that

create conditions for the production and

transition to environmentally friendly fuel,

including hydrogen. According to preliminary

calculations, refueling an electric car costs

three times less than a car with a gasoline

engine, CO2 emissions from eco-transport are

2 times lower than from a gasoline car after a

run of 200,000 km, all other things being equal,

which indicates the prospects for the

development of environmentally friendly

vehicles on «green» fuel.

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MMTGE 2022 - I International Conference "Methods, models, technologies for sustainable development: agroclimatic projects and carbon

neutrality", Kadyrov Chechen State University Chechen Republic, Grozny, st. Sher