Russian climate regulation

Russian climate regulation

Posts on this topic are collected in the category “Russian climate projects and carbonunits”.

The information on Russian climate projects and the movement of carbon units related to them can be found in the table at the link.

The goals of Russian climate regulation

The goals of Russian climate regulation are determined by international agreements in which the Russian Federation participates (details in the article provided via the link).

By Federal Law of November 4, 1994, No. 34-FZ, the United Nations Framework Convention on Climate Change (UNFCCC) was ratified. The Kyoto Protocol to the UNFCCC was ratified by Federal Law No. 128-FZ of November 4, 2004.

During the first commitment period of the Kyoto Protocol from 2008 to 2012, the Russian Federation fulfilled its obligations to stabilize greenhouse gas emissions at the 1990 level.

During the second commitment period of the Kyoto Protocol, the Russian Federation did not undertake international commitments but acted in accordance with the targets set by the Presidential Decree of the Russian Federation dated September 30, 2013, No. 752, aiming to reduce greenhouse gas emissions to no more than 75% of the 1990 levels by 2020.

In accordance with the Presidential Decree of the Russian Federation No. 666 of November 4, 2020, to implement the Paris Agreement, the Government of the Russian Federation is required to ensure a reduction of greenhouse gas emissions by 70% compared to the 1990 level, taking into account the maximum possible absorption capacity of forests and other ecosystems and ensuring sustainable and balanced socio-economic development of the Russian Federation.

By the President’s Address to the Federal Assembly of the Russian Federation dated April 21, 2021, Russia is tasked with reducing the accumulated volume of net greenhouse gas emissions in the period from 2021 to 2050 to lower levels compared to the European Union’s indicators.

According to the statement of the President of the Russian Federation dated October 13, 2021, Russia plans to achieve carbon neutrality in its economy no later than 2060.

By the Government of the Russian Federation Directive No. 3052-r of October 29, 2021, in execution of Presidential Decree No. 666 and the fourth point of the Paris Agreement, the “Strategy for Socio-Economic Development of the Russian Federation with Low Greenhouse Gas Emissions until 2050” was approved. The strategy defines measures to reduce greenhouse gas emissions to 70% of the 1990 levels by 2030, considering the maximum possible absorption capacity of forests and other ecosystems and ensuring sustainable and balanced socio-economic development of the Russian Federation, as well as determining directions and measures for development with low greenhouse gas emissions until 2050.

Two scenarios of socio-economic development of the Russian Federation are provided — inertial and target (intensive), differing in the level of technological development, structural changes in the economy, absorption capacity of natural absorbers, and accumulators of greenhouse gases, among other effects. The target (intensive) scenario is proposed as the basis for implementing the strategy, aimed at helping the Russian Federation achieve a balance between anthropogenic greenhouse gas emissions and their absorption no later than 2060.

The action plan for implementing the Strategy for Socio-Economic Development of the Russian Federation with Low Greenhouse Gas Emissions until 2050 is currently in the stage of public discussion.

By Decree of the Government of the Russian Federation No. 3183-r dated December 25, 2019, the National Action Plan for the first stage of Adaptation to Climate Change for the period up to 2022 was approved. The National Action Plan for the second stage of adaptation to climate change for the period up to 2025 was approved by Order No. 559-r dated March 11, 2023.

By Presidential Decree No. 812 of October 26, 2023, a new Climate Doctrine was approved, replacing the similar document of 2009. The key goal is to achieve, taking into account national interests and priorities of socio-economic development, a balance between anthropogenic greenhouse gas emissions and their absorption no later than 2060.

Reporting on greenhouse gas emissions by russian climate regulation

According to Federal Law No. 296-FZ dated July 2, 2021, “On Limiting Greenhouse Gas Emissions,” regulated entities include legal entities and individual entrepreneurs whose activities:

  1. Involve emissions of greenhouse gases equivalent to 150,000 tons or more of carbon dioxide per year until January 1, 2024 and to 50,000 tons or more of carbon dioxide after this period.
  2. Meet the criteria of production processes and/or types of economic and other activities established by Resolution of the Government of the Russian Federation No. 355 dated March 14, 2022 (energy, oil and gas sector, metallurgical industry, chemical industry, petrochemicals, transportation, waste management, construction materials).

Regulated entities are required to submit reports on greenhouse gas emissions for the previous year to the Ministry of Economic Development of the Russian Federation by July 1 each year. The data is entered into the unified national greenhouse gas registry.

Legal entities and individual entrepreneurs not classified as regulated entities have the right to submit reports on greenhouse gas emissions resulting from their economic and other activities.

The list of greenhouse gases subject to state accounting of emissions and the maintenance of the greenhouse gas registry is approved by Government Directive No. 2979-r dated October 22, 2021 (carbon dioxide, methane, nitrous oxide, sulfur hexafluoride, hydrofluorocarbons (HFCs), perfluorocarbons (PFCs), nitrogen trifluoride).

Experiment to limit greenhouse gas emissions in the Sakhalin region

According to Federal Law No. 34-FZ dated March 6, 2022, “On Conducting an Experiment on Limiting Greenhouse Gas Emissions in Certain Subjects of the Russian Federation,” the regulation governs the implementation of a regional experiment in the Sakhalin Region aimed at achieving carbon neutrality by December 31, 2025. The entire experiment will last from September 1, 2022, to December 31, 2028.

The national objectives of the experiment include:

  1. Stimulating the adoption of technologies for reducing greenhouse gas emissions and increasing their absorption.
  2. Establishing an independent verification system.
  3. Creating a system for handling carbon units and quota units.

In the region, there is a regional registry of greenhouse gas emissions and absorptions, a reduction rate for emissions has been determined, and obligations for emitting companies have been defined.

By Government Directive No. 660-r dated September 27, 2022, the Sakhalin Regional Government has specified a list of 50 regional regulated organizations for the duration of the experiment. By Resolution No. 551 dated November 28, 2022, the Sakhalin Regional Government approved a program for conducting the experiment on limiting greenhouse gas emissions in the Sakhalin Region.

By Ministerial Directive No. 265-r dated September 27, 2023, the quotas for greenhouse gas emissions for 2024-2028 were approved for 35 regional regulated organizations whose emissions of greenhouse gases in 2022 amounted to more than 20 thousand tons of CO2. Before approving the quotas were the subject of public discussion at the Ministry of Ecology and Sustainable Development of the Sakhalin Region and coordinated by the Ministry of Economic Development of the Russian Federation.

By July 1, 2025, these 35 companies will submit verified reports on greenhouse gas emissions for the 2024 year for the first time. In the event that emissions are less than the allocated quotas, the Ministry of Ecology and Sustainable Development of the Sakhalin Region will issue permits for the issuance of Units of Quota Compliance (UQC), which can be transferred between companies.

If emissions exceed the approved quotas, companies have the option to:

  • Use UQCs (issued previously or acquired from another company).
  • Use carbon credits from climate projects.
  • Pay 1,000 rubles per ton of quota excess.

Climate projects by Russian climate regulation

Federal Law No. 296-FZ dated July 2, 2021, “On Limiting Greenhouse Gas Emissions,” defines the concept of a climate project, which encompasses a set of measures aimed at reducing (preventing) greenhouse gas emissions or increasing their absorption.

Climate projects are allowed to be implemented throughout the territory of the Russian Federation by legal entities, individual entrepreneurs, and individuals. The type of project is determined by the methodology used.

The stages of implementing a climate project include:

  1. Project development. The basic criteria for classification as climate projects are determined by Order No. 248 of the Ministry of Economic Development dated May 11, 2022. The implementation of climate projects under national legislation provides freedom in choosing methodologies among:
    • Methodologies of climate projects published by the Registry Operator, undergoing public discussion.
    • Preliminary national standards (methodologies) approved by Rosstandart.
    • Other methodologies for implementing climate projects, including voluntary carbon standards.
  2. Validation. Assessment and confirmation of the project’s compliance with the criteria for classification as climate-related projects according to the procedure provided for in Appendix No. 2 to the Order of the Ministry of Economic Development of Russia dated May 11, 2022 No. 248.
  3. Climate project registration.
  4. Preparation of a climate project implementation report.
  5. Climate project verification.
  6. Issuing carbon units into circulation in the Registry with crediting to the account of the entity implementing the climate project.

Carbon credits are circulated within the Registry until they are withdrawn from circulation and credited to the special account. The ultimate goal of using carbon credits is to offset carbon footprints or meet established quotas.

By Government Directive No. 367-r dated March 1, 2022, AO “Kontur” is authorized to perform the functions of the Carbon Credit Registry Operator. Decree of the Government of the Russian Federation No. 518 of March 30, 2022 establishes the procedure for determining fees for the provision of services by the operator for conducting operations in the Register of Carbon Units. Tariffs for individuals and legal entities are available on the operator’s official website. Federal Law No. 37-FZ of February 26, 2024 exempted the operator’s services from taxation.

Details about buying carbon units is in the article provided via the link.
Details about selling carbon units is in the article provided via the link.
Details about price of carbon units is in the article provided via the link.
Details about carbon units exchange is in the article provided via the link.
Details about climate project development is in the article provided via the link.
Details about climate project validation is in the article provided via the link.
Details about methodologies for climate projects is in the article provided via the link.
Details about climate project registration is in the article provided via the link.
Details about climate project report is in the article provided via the link.
Details about climate project verification is in the article provided via the link.
Details about issuing carbon units is in the article provided via the link.