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President of Russia Dmitry Medvedev: Mr Trutnev, when we took part in a meeting on energy sector development in Omsk [on February 12, 2010] addressing the current situation in fuel and energy, it was agreed that you would report to me on a number of issues. In particular, I would like you to brief me on the progress in amending our environmental legislation. The subject has been on our agenda for some two years since in January or February of 2008 I held the initial meeting on this matter. We further discussed it on subsequent occasions as well.

I refer to two aspects of this legislation: maximum allowable emissions and regulations in this technological component of the environment, and toughening liability for breach of environmental regulations which in some respects needs to be increased while in other respects may be reasonably reduced.

How is this work progressing, what will be the respective bills and when will they be drafted?

Minister of Natural Resource and Environment Yury Trutnev: Mr President, we are in the final stage of drafting the legislation, and in April we intend to submit two documents to the Government. Currently, they undergo approval procedures and examination by business community and federal agencies, as they will essentially modify the overall regulatory setting for both the environment and the economy.

We develop a truly objective quota setting system based on environmental impacts caused by air and water pollution businesses generate, rather than on quotas allotted to each company.

Dmitry Medvedev: How are these impacts measured?

Yury Trutnev: The measurement is based on the maximum allowable concentrations of pollutants. The concentrations are identified depending on their effect on humans. When referring to [financial] liabilities, it is envisaged that the businesses and companies which are in compliance with the limitations will benefit from reduced duties while those that surpass the established quotas will be charged extra.

The overall goal of the draft legislation is to create incentives for companies to modernise, because our main challenge is not just to improve our environment, but to also modernise businesses and create conditions where introducing new technologies becomes profitable.

Unfortunately, today, we do not have any such incentives in our legislation. We are therefore really hoping that in April, if our suggestions are accepted, we will be able to pass such laws.

Dmitry Medvedev: All throughout the world, a major policy now is stimulating Green Growth, i.e. growth of economies through introduction of advanced environmentally friendly and energy efficient technologies, including the use of alternative energy sources. This topic is very relevant for us. We, too, have our own standards and goals with regard to energy efficiency, therefore amendments to environmental legislation must not neglect energy efficiency, which is our concern as well.

Our companies should be offered motivation and incentives to invest in improving our overall environment, on the one hand, and to upgrade their production, their treatment facilities, and their technological standards for business operation to the most advanced examples seen in the world, on the other hand.

No doubt, they will not be persuaded to do so if they only see a stick, there should also be a carrot. A system of economic motivations should be introduced to include both incentives and sanctions. That should be our guiding principle.

I have one more question for you about the weather. This winter has been very harsh throughout the country with persistent and severe frosts. Accordingly, the snow and ice mantles are very thick. When spring thaw starts the situation may thus become dangerous because of flooding, inundation and other similar environmental adversities.

I hereby instruct you and the Ministry of Emergency Situations to jointly plan a set of actions to be taken during the flooding period, for us to be fully prepared.

When I was in Siberia – in Tomsk, Omsk, and Kemerovo – I discussed the issue with the regional governors who say that due to the thickness of the ice and snow layers, the flooding may be perilous. We must be on alert and take all the necessary measures in advance to minimise problems caused by snow and ice melting.

Yury Trutnev: Yes, Mr President. If I may, I will complete my answer to the first question.

We assume that our challenge is to motivate companies to use better technologies. Our environmental legislation adjustment includes two phases. The first phase involves changes to the quotas and [financial] liabilities. The second phase involves introducing the benchmark principle of the best available and affordable technologies, whereby we will judge companies’ performance in comparison to the best technologies available in the world at a given moment, and compose a national list of the best technologies used. This goal will be accomplished.

As for your second question, it is true that this year’s situation is offbeat. Here is a map, with territories where snowfall was over 50 percent higher than average coloured in red. In some territories the snowfall was double of the average.

Dmitry Medvedev: The governors told me that the Tom river is covered with a layer of frozen ice seven to nine meters deep.

Yury Trutnev: The rivers are frozen nearly to the bottom, so we currently monitor rivers all around the country and increase intake capacities by reducing water reserves in reservoirs, as well as check all our water control facilities. About 2 billion rubles [some 67 million dollars] have been allocated to the regions for flooding alleviation. Jointly with the Ministry of Emergency Situations we monitor the overall situation.

Dmitry Medvedev: Monitoring is not enough, you should convene a meeting, communicate with the territories primarily affected, the ones in red on your map, and collect detailed information on the scenarios anticipated and the steps to be taken.

I would like to briefed in the aftermath.