Renewable energy sources

The European Union has set a target for a reduction of 20% in GHG emissions in the year 2020 compared with 1990 levels predominantly through shifting from fossil fuel to renewable energy sources.

The Company seeks to cover its energy needs primarily from renewable sources. Nornickel makes continuous efforts to reduce the consumption of such energy sources as diesel fuel, coal, and natural gas as well as to provide its enterprises with reliable and efficient low-carbon energy sources in the long term. As a result of Nickel Plant shutdown, the estimated coal consumption declined by 40–70 ktpa.

The Company’s priority energy source is hydropower generated by hydropower plants: Ust-Khantayskaya and Kureyskaya HPPs (481 MW and 600 MW of installed capacity, respectively). In 2018, renewables accounted for 44% of total electric power generated by the Norilsk Nickel Group and 51% of power generated in the Norilsk Industrial District. The Company rolled out a project to replace hydropower plant equipment for rendering it more reliable and increasing power output through better performance of hydroelectric units (implemented in 2012–2021), thus laying out the groundwork to expand the share of renewables.

The use of other renewables such as solar, geothermal, and wind energy is limited, as Nornickel’s major production assets are located beyond the Arctic Circle. There is not enough solar energy in winter because of polar night lasting approximately 60 days. Wind turbines are also inefficient due to changes in wind intensity: weather conditions range from dead calm lasting for weeks to snowstorms with a wind speed of up to 50 m/s.

Power consumption and energy efficiency improvement

Nornickel is committed to the responsible use of heat and electricity. 85% of electricity is generated by the Company’s fuel and energy companies supplying electric power to both intragroup facilities and third parties.

2018 saw the Company continue implementing initiatives in pursuance of Presidential Executive Order No 752 On the Reduction of Greenhouse Gas Emission Volumes of 30 September 2013. The Group's investment programme embraces several large-scale priority projects to fully unlock the potential of renewable power sources (hydropower) and ensure energy savings.

Major projects include:

• replacement of hydroelectric units and introduction of an automated dispatch system at Ust-Khantayskaya HPP;
• TPP-1 retrofit to enable automated process control;
• replacement of wooden supports at 110 kV lines with steel ones;
• construction of steam pipelines for the centralised heat supply system.

In 2018, significant efforts were invested in improving energy efficiency. As a result, the Group achieved savings of 87,822 tonnes of reference fuel (units). In the reporting year, per unit fuel consumption at TPPs stood at 265 g/kWh, down by 29 g/kWh vs target and by 17 g/kWh y-o-y. During the reporting year, the Company’s subsidiaries saved 17.3 mcm of natural gas.