EkoNiva Group shifts to green power
31 August 2022 News from the Company
EkoNiva Group, the largest milk producing holding in Russia, starts using renewable energy at its operations. Dobrino dairy farm in Voronezh oblast is going to be the first facility to switch completely to green power. The Group is implementing the project in partnership with NovaWind company, a wind energy subdivision of Rosatom state corporation.
NovaWind’s wind farms are in Stavropol area, Rostov oblast and the Republic of Adygeya. The electric power from renewable energy sources is going to be supplied under a free bilateral contract to be concluded subject to the Wholesale Electricity and Capacity Market Regulations.
EkoNiva is going to become one of the first raw milk producers in Russia to purchase wind power thereby meeting all its energy needs exclusively from renewable sources. This will enable the company to significantly reduce the indirect greenhouse gas emissions.
The supply of green energy to Dobrino dairy is starting in September 2022. By switching to renewable electric power, the farm can reduce its indirect greenhouse gas emissions by estimated 1,000 tonnes of CO2 a year. After reviewing the pilot project results in Voronezh oblast, the Group will evaluate the feasibility of shifting to renewables at its other facilities. Besides, the planning of all subsequent projects will include green power option.
"The use of renewable environment-friendly energy is part of EkoNiva Group’s ESG agenda. Minimising the environmental impact of the operations by reducing greenhouse gas emissions is one of the company's priority goals. We are happy that together with our partners from NovaWind we can take an even more responsible approach to doing business", said Lyubov Aksyonova, Manager of GR&ESG Division of EkoNiva Group.
"The generation of low-carbon wind energy should reduce the carbon footprint and help to achieve sustainable development goals. We are committed to supporting our partners in minimising the production process impact on the environment. Switching to renewable power is an important step in the evolution of any business. We hope that this pilot project will lead to a long-lasting partnership of our companies", said Grigoriy Nazarov, Director General of NovaWind JSC.
EkoNiva is the largest raw milk producer in Russia and Europe and a top three in the world. Since its foundation in 1994, EkoNiva has been taking responsible business approach including high animal welfare standards, environment protection, upgrading employee qualification and development of the rural areas in the regions of operation. Two years ago, the Group devised and adopted a Sustainable Development Strategy in compliance with the UN’s international sustainable development goals and ESG standards. In 2021, the company published its first sustainability report. Soon it will issue the report for the previous year.
About the company
NovaWind JSC is a subdivision of Rosatom responsible for consolidation of the State Corporation’s activities in the advanced power sector segments and on the technological platforms. The company was established in September 2017. NovaWind manages all wind energy operations of Rosatom – from engineering and construction to machine building for energy industry and managing wind farms. NovaWind JSC has launched wind power facilities cumulatively providing 720 MW to date. In total until 2027, Rosatom will open wind power stations generating around 1.7 GW.
Energy is supplied under free bilateral contracts as provided for by the Wholesale Electricity and Capacity Market Regulations. The contracts stipulate the group code of the supply points generating renewable energy. The Free Bilateral Contracts register containing information on the volumes and contractual parties is updated by the NP Market Council Association every month. With the development of the renewable energy sector in Russia, more and more wholesale electricity and capacity market players are entering into such contracts. In this way, responsible consumers confirm their willingness to use green energy for their businesses. Globally, power purchase agreement (PPA) is a common practice for purchasing renewable energy. The confirmation of the use of the green energy under bilateral contracts conforms with the CDP (international carbon disclosure project) accounting standards, which is widely used in the world.
EkoNiva Group is a vertically integrated agricultural holding, the largest raw milk producer in Russia and Europe. The company’s assets are located in 13 regions of Russia: Voronezh, Kaluga, Kursk, St. Petersburg, Moscow, Novosibirsk, Orenburg, Ryazan, Samara and Tyumen oblasts, Altai area, Tatarstan and Bashkortostan. Dairy farming is the main business of the Group, which owns 40 modern dairies housing 220,000 head of cattle, including 110,000 dairy cows. In 2021, EkoNiva produced over 1.1 million tonnes of raw milk. Since 2013, the Group has been developing its own milk processing. EkoNiva is a top 5 owner of agricultural land having 630,000 ha. Preliminary figures from the unaudited consolidated financial statement indicate that in 2021 the sales revenue of the Group grew by 33% to 50.8 billion RUB, EBITDA – by 3%, exceeding 16.6 billion RUB.