Unification line

Why developing common approaches in the energy sector is crucial for Belarus and Russia

The two countries have come closer to creating a single energy market, which gives them the opportunity to ensure the formation of a common economic base for the Union State’s development. A single energy market lays the foundations for a common market of goods and services without price, tariff and other imbalances, exceptions or distortions.

Equal conditions

In the context of increased external competition from Western corporations, it is important to create internal operation modes for national economies without any price distortions. It is this approach that lays the groundwork for accelerated economic growth. In other words — the cheaper electricity, the lower the price of final products including petrochemicals, mechanical engineering, electronics, construction industry, etc. As a result, the two countries will become more attractive to customers than their competitors in terms of cost hence will be able to expand their presence in the market.

The international agreement between Belarus and Russia establishes the legal basis for the formation, functioning and development of the unified energy market of the Union State, and regulates relationship on the purchase and sale of electricity between the market participants. 

In addition, the unified energy market will give Belarus additional opportunities to export electricity to Russia. After all, our Western neighbours have abandoned relatively cheap Belarusian electricity in favour of pseudo-European values and illusory advantages of European integration. Thus, last July, electric power transmission system operators Litgrid (Lithuania), AST (Latvia) and Elering (Estonia) notified Russia and Belarus of the non-extension of the agreement on parallel energy system operation within BRELL ring — Belarus, Russia, Estonia, Latvia, Lithuania, signed in 2001 and valid until February 2025. They also plan to dismantle the remaining power lines. The Baltic States and Poland are synchronising their power grids. For this purpose, the EU has allocated about €1.2 billion, which should cover about 75 percent of the costs. The Baltic States stopped importing Russian and Belarusian electricity to provide the needs of the border regions in 2022. By such actions, the European Union forcibly drives enterprises and the population of the Baltic States into debt and plunges them into a state of austerity, which will definitely restrain the national development of Latvia, Lithuania and Estonia.

Economy plays a pivotal role 

Within the framework of the Union State and the single energy market, the two countries will develop industry, agriculture and science in comfortable conditions, as well as will be able to regulate economic processes according to uniform principles.
In the unified market, when a supplier engages with a Belarusian producer, they can facilitate the overflow of electricity to Russia. The procedure for electricity purchase and sale is simplified. Consequently, Russian consumers, who signed contracts with Russian electricity producers, will be able to do this with Belarusian companies in the same manner. 
Aleksei Kushnarenko, Director General of Beltopgaz State Production Association, clarified that ‘the convergence of economic activity conditions, open and transparent approaches to tariff setting will contribute to enhanced efficiency of energy supply organisations, bolster their production and technological potential, and enable the implementation of new joint projects, including in the modernisation of electric grid infrastructure’.

Tariffs will be uniform for both external and internal supplies. In addition, we will have the opportunity to further strengthen Belarusian and Russian roubles, and switch to settlements in national currencies instead of dollars and euros.

Stages of a long journey

Belarus’ Energy Minister Viktor Karankevich has stated that the Belarusian-Russian decision is aimed at creating an equal competitive environment that will ensure a variety of price offers for consumers. Moreover, there will be incentives to upgrade and develop generating capacities and attract additional investments to the industry. The single energy market of Belarus and Russia is ready for the first stage of operation, with electricity trade enabled between legal entities. The Belarusian side will be represented by Belenergo State Production Association. The second stage envisages deeper integration with an expanded membership and the organisation of a unified technological management process.
In the future, the Union State’s single energy market will be synchronised with the operation of the common market within the Eurasian Economic Union (EAEU).
Thus, it can be safely stated that the creation of a unified energy market within the Union State will strengthen the economic sovereignty and energy independence of our countries, as well as will protect consumers in Belarus and Russia from negative trends, primarily from global price increases.


By Aleksei Avdonin, analyst at Belarusian Institute for Strategic Research (BISR)