The potential for improving energy efficiency of the Russian economy: Sectoral assessment and macroeconomic effects

Russia has substantial room for reducing energy consumption by using energy more efficiently, a task made especially pressing by limited investment resources and the need to strengthen the competitiveness of domestic output. This study aims to establish the upper bound of the technically feasible reduction in energy use in Russia through the deployment of advanced energy-efficient technologies and to identify the macroeconomic effects of their implementation. Existing research tends to be confined to individual sectors or regions, or focuses primarily on technical aspects or institutional barriers to energy saving. The study’s novelty lies in developing an integrated framework that combines an assessment of the potential across four sectors (energy, housing and utilities, industry, and transport) with a ranking of measures by economic feasibility and the identification of options offering short payback periods. The methodology draws on a combination of sectoral analysis and a scenario approach, using data from Rosstat, projections by research institutes, and expert estimates. The results indicate that the overall energy saving potential could reach as high as 50% of current consumption, generating a direct economic effect of up to 1.3 trillion rubles annually (roughly 0.6% of GDP) and cutting СО₂ emissions by as much as 65% of the country’s total emissions. The priority areas identified include optimizing the load of combined heat and power plants, developing distributed generation, introducing heat pumps and smart metering systems, modernizing industry, and promoting electric transport together with public mobility. A limitation of the study is the absence of a detailed assessment of cross-sectoral multiplier effects and the economic efficiency of each technology. This points to future research aimed at building an input-output model that would capture feedback loops between sectors of the economy.