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Business & Economics

ECONOMIC AND BUSINESS ASPECTS OF RUSSIAN ENERGY MARKET: DEVELOPMENT OF COMBINED HEAT AND POWER TECHNOLOGIES
Evgeny Lisin, Ivan Garanin, Wadim Strielkowski, Sona Kritkova

ABSTRACT.This paper analyses and compares the economic and business development of Russian and EU electric power grids from the standpoint of centralized power utilities, based on cogeneration of heat and electric power. The authors of this article identify main drivers for the development of national grids with cogeneration plants. Moreover, the authors demonstrate that despite engineering expenses, costs, and environmental factors, an overwhelmingly favouring cogeneration over other options for electricity generation and district heating, this type of power plant is poorly adjusted to the market conditions. The paper provides an analysis of operational issues faced by combined-cycle power plant in a power-market environment and identifies potential approaches for improving their competitiveness .

KEYWORDS: energy economics, cogeneration, combined heat and power plant, electric power market, rate regulations, competitiveness, the Russian Federation, EU.

JEL classification: C18, D24, D40, E23, L94, O14, P51, Q48.