By Jennifer Rankin

MOSCOW (Reuters) - The world's top oil and gas producer may be watching its energy riches blow away in the wind. Russia, in 2008, was wasting enough energy to power Britain for a whole year.

It was then that President Dmitry Medvedev set a target to reduce energy intensity, a rate of waste measure, by 40 percent by 2020. Russian companies were 10 to 20 times less energy efficient than their foreign rivals, he said.

Not enough has changed since Soviet times, critics say, and wide-open windows remain a typical way of cooling overheated housing blocks. Even today around one-fifth of Russian boilers date back to the era of cosmonaut Yuri Gagarin's space flight in 1961, or earlier.

"We are two and half times less energy efficient than other comparative modern countries in Europe," said Vasily Belov, head of the energy efficiency cluster at the Skolkovo Foundation, a government-sponsored science park.

Raw economics, not environmental qualms, have won the energy efficiency drive powerful backing from President-elect Vladimir Putin to the monolithic oil and gas companies.

But progress grinds against grass roots skepticism and entrenched attitudes.

High-rise apartment blocks, and other buildings, absorb the biggest share of Russia's energy - around 35 percent. Industry follows with 29 percent and transport, 21 percent.

In one such block sits Denis Platonov, a 31-year old Muscovite and married father of two, warily watching his electricity meter.

Before heat and power even arrives in the Platonov's apartment, a large amount is wasted - 30 percent of heat and 11 percent of electricity is lost in transmission.

The potential energy-saving boon of combined heat and power systems, common in Russian apartments, is nullified by 200,000 km of ageing heat-supply pipes and decrepit equipment.

The Platonovs' meter is a rarity in Russian flats, but something that could be commonplace if an energy-savings law is implemented scrupulously. They look at their bill with suspicion.

"It's rather difficult to look at this paper and understand how much energy we consumed, because these are just assumptions," said Platonov, a sales representative for a software company.

"There are a lot of mistakes, sometimes it seems like that the managing company is trying to cheat you."

"I'm not going to agree to pay twice as much for energy-saving appliances because I am not sure that they will help me to save energy - if you compare the expenditure with the benefits, it is unreasonable."

Valery Sajenkov is vice president of Schneider Electric Russia, a French company that is seeing growing demand for its energy-efficiency devices in Russia.

"The most difficult task is to transform public awareness on an everyday level," he said. "Here there is a need for definite measures in schools, university - education and upbringing - to orientate people towards energy efficiency."

The first steps have been taken, such as smart energy bills showing different tariffs, allowing consumers to run appliances more cheaply at night, he said.

But for a public keen to give shining new toys a spin after decades of empty shops and drab interiors, thrift can be hard.

"During the Soviet Union we had a lot of problems buying a new refrigerator, buying a new washing machine," said Maxim Titov of the World Bank's International Finance Corporation (IFC).

"If you talk to a guy in Siberia, he will tell you: ‘for 20 years I was dreaming of buying a four-wheel drive. I will do it. I will not buy a bicycle.'"

BIG COMPANIES

Upgrading Russia to decent energy efficiency standards would cost $320 billion, but this could pay for itself in four years, according to the IFC's calculations.

It is vital if Russia is to avoid economic stagnation by the middle of the century, as fossil fuel reserves go into decline, said Igor Bashmakov, director of the Centre for Energy Efficiency in Moscow.

He expected oil production to start declining before 2020 and gas after 2040.

"Energy efficiency is a real key to survival," Bashmakov said.

Newly-elected President Putin included the development of energy-saving goods, as well as more energy saving in private homes, in his manifesto. Continued...