Russia's Energizer Bunny--Rosatom

Alexei Likhachev and President Putin discuss Rosatom’s results and plans.

I must confess to admiring the presentations made by Mr. Likhachev as they are complete, easy to understand and provide excellent forecasts primarily because the public corporation Rosatom is so dynamic and does so much more than make nuclear reactors and bombs. Just how important it is to Russia’s economy and social structure you’ll soon discover if this is the first such report about Rosatom the reader’s encountered—I’ve written at least four. Rosatom’s website is very international with its pages translated into many languages, English included. Some readers will find Rosatom’s distillation of Russia’s nuclear industry’s history of interest. It notes that Rosatom came into being in 2007 and shares a similar history with Rosneft which was also founded in 2007 in that it was tasked “to consolidate disparate nuclear enterprises and industry institutes into an integrated and efficient mechanism.” Rosatom also has a renewable energy division which is very impressive. And as some know, Rosatom via Rosatomflot builds Russia’s nuclear powered icebreaker fleet which has no parallel on the planet. Recently at Rusia’s Energy Week, Putin stressed the need for extensive planning for the future horizon out to 2045 and an increase in the proportion of power provided by nuclear power stations. The many Arctic projects that need locally generated power will likely involve Rosatom and its new devices. Rosatom will be busy for many decades to com. But enough advertising; here’s the report:

Vladimir Putin: Today we have a meeting dedicated to the results of our work.

A. Likhachev: I would like to say right away that despite external challenges, the state corporation has managed to maintain serious development parameters. We have not only strengthened our projects, but also made serious groundwork for the future, primarily in terms of scientific and technological development.

Vladimir Vladimirovich, let me start with the economic indicators. Average annual revenue growth is 24 percent. We will cross—we aim for this—three trillion rubles this year [@$34.5 billion]. Of these, about one trillion 200 billion is revenue from new products.

The average annual growth of foreign revenue is 23 percent. Well, another interesting fact: this year we will have more than 400 thousand people, and we are also growing in terms of the number of employees of the state corporation. Labor productivity—we aim for 12 percent of the average annual growth. Average wage growth—11 percent over the past five years.

Dear Vladimir Vladimirovich, we are increasing our contribution to the country's economy. Our nuclear order has already been formed, including those contracted for many items for the next 10 years—52 trillion rubles [@$600 Billion], most of which is under the state corporation's control. I am sure that this figure will be increased in the course of implementation, and we will probably reach the figure of up to 100 trillion rubles – such a conditional investment of nuclear scientists in the economy of our country.

The investments themselves have an average annual growth of 31 percent. We have reached the amount of about one and a half trillion rubles a year. Of course, we are primarily interested in projects in the Russian Federation, although we also invest in foreign projects.

And our contribution to taxes, social security, and the social sphere is growing – more than half a trillion.

Mr President, we would like to thank you, of course, on behalf of the entire industry: You supported our project "Development of Equipment, technologies and scientific research in the field of nuclear energy" in 2020, and in 2022 you decided to extend it.

At the strategic session in the Government Mikhail Vladimirovich [Mishustin] supported the idea—to immerse all five federal projects in the new national project "New Nuclear and Energy Technologies". The entire content of our national RTTN program [Development of engineering, technologies and scientific research in the field of nuclear energy use in the Russian Federation], all five federal projects are now immersed in the national project.

In addition, about ten national projects are held with our participation: everything related to the data economy, chemistry, new materials, mechanical engineering, health, logistics system. In general, we are actively working in this direction under the leadership of the Government.

Vladimir Vladimirovich, our main service is the state defense order.

Vladimir Putin: The average annual increase in taxes and social payments was 15.5 percent?

Alexander Likhachev: About 15.5 percent. It is clear that costs are also growing now, so we are growing our turnover a little disproportionately, but we are still one of the main taxpayers in the country, and in terms of the total contribution to social security and taxes, we are the third largest industrial companies in our country.

On the state defense order. Three tasks are always solved by the nuclear weapons complex. This is the task of ensuring nuclear parity, developing new weapons based on new physical principles and developing non-nuclear weapons, including for the needs of a special military operation.

In addition, the nuclear weapons complex is a supplier of sovereign technologies to all our advanced areas: mechanical engineering, the digital economy, medicine, additive manufacturing, and materials science. This allows us to achieve faster growth in the volume of civilian products. Already last year, we crossed the target of 50 percent: 52 percent of the "citizen" was in the framework of the Rosatom defense industry, and by 2030 we will increase these figures to larger proportions. Despite the fact that the State Budget itself, of course, is growing-sometimes it grows tenfold.

Vladimir Vladimirovich, your assignment—25 percent of nuclear electricity in our country—is being fulfilled, and I would like to note the great work that is currently being done by the Ministry of Energy. The Ministry of Energy already has a new general scheme. What is important to note? That Rosatom not only offered a good technological solution, but also we were the first in terms of the cost of electricity. First, due to the long life cycle of nuclear power plants, we even underestimate it, because we write—60 years, and they will work longer, but we cannot yet write more than 60 years due to legal reasons.

We have a very high utilization rate of installed capacity—more than 80 percent, and, of course, we are import-independent, so all the challenges associated with import substitution did not cause economic damage to our projects.

And in pursuance of this decision on the attractiveness of our tariff, the Ministry of Energy supported our proposal for 37 power units until 2042, which will allow us to reach 25 percent in the mid-40s.

Vladimir Putin: Exactly how much is there in the overall structure today?

Alexey Likhachev: Today, in fact, nuclear electricity is about 19 percent or so. We are adding several billion kilowatt-hours of our wind farms, so we are keeping a steady target of 20 percent of nuclear electricity. In the world, we are about in the second ten in terms of specific gravity.

Vladimir Putin: We have grown by 3 percent since then.

Alexey Likhachev: Yes, we have grown by about 3 percent in recent years.

Over the past year, everything has been going according to plan at foreign facilities, you know them very well, you know the news: in Uzbekistan, we have signed the first contract for a small nuclear power plant, a very attractive, large-scale fuel contract with the Indians. Everything is going according to plan in Bangladesh, fuel was delivered there, fuel was delivered to Turkey.

And, of course, the main event of last year—we handed over the Astravets nuclear power plant to the Belarusian customer. You know firsthand how strictly the customer treated us, how we got then from Alexander Grigoryevich [Lukashenko]. But when we rented out the station to him in November, he said: I don't want to let you go. And we have prepared about a dozen more projects of technological sovereignty with a total starting volume of 50 billion rubles for implementation in Belarus.

I just want to thank you for the decision you made—now many years ago–-about tools to support atomic exports. This is a very effective tool—lending to the client country. First, the money is returned to us with interest, and secondly, in fact, they are mastered in the Russian Federation. And, of course, we create projects for hundreds of years in these countries in the truest sense of the word. This export support tool works very well.

And now, by combining our Belarusian experience, we have reached a completely new quality of work in export. Mr President, I would like to draw your attention at once to the figures of the analysis of foreign revenue in recent years. Volumes are growing, as I told you, but the share of friendly countries in revenue is also growing very noticeably, and this year it will reach 80 percent. How do we achieve this?

We have started—using the example of our work in Belarus—the export of technological sovereignty. And our friendly countries respond very well to our proposals: partnership in projects related to the environment, digital technologies, mechanical engineering, and energy storage. This allows, in addition to nuclear exports, to attach a large amount of projects of technological sovereignty to it.

I would also like to point out that we also offer our fuel to countries where foreign-designed reactors are located. United Arab Emirates: Koreans built the station there, and they are buying our PMO. In Brazil, in Mexico: only we supply enriched uranium products, although there are stations of American design.

Global trends are already emerging from these projects of technological sovereignty. I would like to report to you that under the leadership of Vitaly G. Savelyev, we have formed the federal project "The Great Northern Sea Route", taking into account the entire transport support infrastructure in the north of our country, solving the problem of exporting our goods in the first place, and in the second place—the connectivity of territories, including northern delivery. And, of course, the task of international transit.

This support chord, the northern transport infrastructure, can help us realize the idea of unloading the Eastern landfill. And at the stage in the 30s, a comparable amount of cargo will be transported by the Northern route, but there is still a lot of work to be done.

According to the plan, we are building nuclear icebreakers. The construction of the Arctic cargo fleet is a big challenge. We have reported this area to the Government in a separate way, and it will also be part of the federal project.

Vladimir Vladimirovich, in terms of transportation along the Northern Sea Route, we are slightly ahead of last year's records. Despite all the pressure, we have a very high demand for the Northern Sea Route in terms of cargo transportation.

I also want to thank you for supporting our logistics work. FESCO, the Far Eastern Shipping Company, was transferred to us, along with other areas, and we are now working to ensure transport sovereignty not only in the north, but also in other basins.

Of course, we work well together, including with our transport companies and railway workers, and our task is to ensure logistics sovereignty, while developing container transportation in a special way with our foreign partners. The People's Republic of China and India, as you know, are showing interest, and a joint venture has been established with the United Arab Emirates.

I very much hope that we will really speed up and develop the work of the NSR along the entire perimeter, along the entire geography of transport routes.

Vladimir Putin: [In the presentation,] look, you need to show the Northern Latitudinal passage, you don't have it, but you should have it.

How the plan looked like 5 years ago.

A. Likhachev: The Northern latitudinal passage-1 is from Nadym to Obskaya, and the Northern latitudinal Passage-2-from Obskaya goes to Sabetta. These two sections are still drawn with a small dotted line.

But, of course, given the budget constraints, we need to think about how to implement these projects. These are deep investment projects, and we, of course, can only do them together with Russian Railways.

Vladimir Putin: Yes, so they have it.

A. Likhachev: They have, yes, we are working well together with them.

Vladimir Putin: We need to show it here.

Alexander Likhachev: Yes, it will be done.

This is just a slide about logistics.

Vladimir Vladimirovich, we regularly report to you at the Forum of Future Technologies about a lot of work on the groundwork of tomorrow, on future technologies.

Remember, a year ago we talked about quanta, showed a 16-quantum processor? Now it's already 50. And from the laggards, we have definitely come to the top 5 countries. In general, all four platforms are developed by only two countries: us and the United States of America.

A lot of work is being done to create super-powerful computing platforms, both from the point of view of today's supercomputers and work in the photonic direction. In general, here, not only by multiplying computing power, but also by using new physical principles, we will, of course, solve this problem–-creating a computing superpower.

This year you have already visited the forum on health and medicine, we showed you both bioprinting and work on nuclear medicine. I can add that now a new direction is already being implemented in accordance with the forum's decisions – this is work in the field of oncology. At the gene and cellular level, activating a person's own immune cells in bioreactors, returning them to the body, and working at the most difficult final stages of a completely different quality to help cancer patients.

The next task of the forum that you set for us is materials science. And our task, in simple terms, is the following: now we are manually able to create new materials with the specified properties. Our goal is to do this in the next generation, taking into account artificial intelligence, already on a huge industrial scale. Let's try to make this leap in a year and offer specific installations together with artificial intelligence.

And, of course, leadership in space exploration is impossible without nuclear technology. Here we work with Roscosmos. Plasma rocket engines are part of our national project. Unlike gas-dynamic ones, they have completely different efficiency, completely different fuel consumption, and space exploration is almost impossible without them.

Vladimir Putin: Maneuvering, changing orbits.

Alexander Likhachev: Changing orbits, maneuvering, deep space, of course. This is a unique groundwork, very few people can compete with us in this.

Vladimir Vladimirovich, in conclusion, let me talk about the main thing. The main thing is, of course, people. All the potential and our value of the state corporation are in our nuclear cities: 31 cities, 2.5 million inhabitants. Traditionally, we tell you how we work together with the FMBA to improve medical services, how we work with the urban environment, host our Smart Cities project, and influence social life.

But this year, during your Address, you gave instructions to create master plans for supporting cities, and first of all for cities of technological development. Four master plans for our cities have already been created, and 31 cities will join the group of cities that create master plans over the next two years.

This is a very big support, because the infrastructure of our cities, of course, is worn out, and we cannot cope with the municipal authorities and provinces alone. And multiplying our activity in cities with the creation of master plans, with the work that Marat Shakirzyanovich Khusnullin is currently doing, is a breakthrough in organizing work in cities. Thank you so much for this.

Thank you also for the fact that this year we have three winners of the State Prize in the nuclear industry. In general, 12 Heroes of Russia and Labor work in the industry, and three new ones are State Prize winners.

We have, of course, a high-tech industry, and we have special requirements for people—in terms of professional training, in terms of readiness to serve. Therefore, we see three big tracks: the task is to bring not only a ready-made specialist to the industry (and we need 300 thousand people by the end of the 20s), but also a person who shares our culture and values. Rosatom's schools, Mendeleev classes, engineering classes, and atomic classes are aimed at this. We work with more than 100 flagship universities and train such a pool of young specialists. We have about a third of young people in the industry.

The second task is to reveal the person inside, while working, to show that he is the center of our work and the whole atomic world revolves around him. Two academies—corporate and technical. We have the biggest competition of professional skills on the planet, more than 1.5 thousand participants, [the program] of recognition "Person of the Year", which is held as a huge labor holiday. All this allows us to keep our industry engagement at 82 percent.

And, of course, we need to make people feel like they are not only nuclear scientists, but also members of our society. We actively participate in all programs, projects, "Russia is a country of opportunities". You gave us such an honor: the first days and first weeks of the "Time of Heroes" project were spent on a nuclear icebreaker. In general, we are absolutely integrated into all national projects and work with people. Of course, we also unite the nuclear youth around us abroad.

Vladimir Vladimirovich, we are celebrating the 80th anniversary of the nuclear industry next year. Of course, first of all, we will definitely invite you, and we would very much like it to become a holiday not only for nuclear scientists, but for the whole country and for all our foreign partners.

With your permission, we will prepare such a program and launch it this year. And so it turns out that the nuclear industry was born in one year with a Great Victory – a little later, and we would have planned the main events for August-September next year, including with your participation.

Vladimir Putin: All right, of course.

Alexey Likhachev: Thank you very much.

Vladimir Putin: It is 80 years old, but the future is good, and this is also confirmed by the fact that, in my opinion, about 30 percent are quite young people from among the nuclear industry employees.

Alexander Likhachev: Mr President, we have a very harmonious team: just over 30 per cent of young people, 30 per cent of the "golden link" 40-55 years old, and up to 30 per cent of veterans-we employ people in their 80s and 90s, many of whom you know personally, this is our pride and responsibility—our value. And in this sense, such harmony and connection of generations-they enable us not only to work and be successful today, but, most importantly, to build our plans for decades to come.

We agreed that next year-the year of the 80th anniversary of the nuclear industry – we will approve a strategic program: the program of our strategic development until 2045-until the centenary, for another 20 years.

Vladimir Putin: Good. [My Emphasis]

As I mentioned, Rosatom is into almost every science and technology that’s important for Russia. It’s precisely the sort of company I’d want to operate. But it’s not the only company in Russia that’s like that, Rosneft being the other along with Gazprom and Russian Railways. What was the #1 “main thing” again and where have we read/heard that before. The difference in social philosophy between West and East/South is vast. Quite frankly, companies like Rosatom and Rosneft wouldn’t exist in the West even as privately owned, publicly traded corporations, because like GE they’d be broken into pieces, sold-off and financialized, their R&D components sold for a Fistful of a Few Dollars More. Now GE can’t produce fuel for its own reactors. Russia has very ambitious plans for the future all aimed at promoting very vibrant growth and a very wide spectrum of opportunities for its citizenry, not just career-wise but also in the socio-cultural realm which Russian philosophy sees as important as work. It appears that Russians have taken the Biblical exhortation—Man doesn’t live on bread alone—to heart and incorporated it into their philosophy and lifestyle—even during the Soviet years. And that concept is shared by all Russians and seems to be appreciated by Russia’s friends.

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