According to the central bank, Russia’s plan for reducing its carbon footprint by 2050 requires investments of between 1 trillion and 4 trillion rubles per year ($13.4 billion to $5.33.6 billion).
Russia’s economy is heavily dependent on oil and gas production as well as mining, so climate change presents a significant challenge. Permafrost is used to build some of this infrastructure, but it is susceptible to rising temperatures here.
Russia, the fourth-largest emitter of greenhouse gasses in the world, will use 1% to 22% of its gross national product to reduce net greenhouse gas emissions by 2050, according to the main scenario approved and approved by the government.
In a report on financial stability, the central bank stated that such investment would require active financing by Russian banks and the entire financial sector.
The central bank stated that even though Russia’s banking sector is able to raise sufficient capital, it could have trouble securing loans for “green” projects due to high-risk factors such as lack of transparency.
Russia’s economy ministry warned that Russia won’t become a zero-emission economy by 2050. If it attempts to achieve this goal, it risks losing macroeconomic stability as well as sustainable growth.
Russian companies that have negative environmental impacts have begun to implement sustainable development principles, but integration into the global climate agenda is still low, according to the central bank.
“This situation must be changed. Otherwise, the (Russian] financial sector could face significant risks in the medium-term.”
