Industry News

At a meeting in absentia, its results summarised on 21 November, the Board of Directors of RAO UES of Russia approved the terms to conduct an auction for the right to buy 25%+1 share of OJSC North-Western Heat and Power Plant (NW HPP) from CJSC Inter RAO UES, according to the minutes of the meeting. The parameters had been basically approved at the previous meeting of the Board on 30 September, upon which they were reviewed by the RAO Management Board.

A meeting of the Federal Tariff Service held on Tuesday approved the planned balance sheet of electric power production and supplies within the Russian unified power system by subjects of the Russian Federation for 2006, reports FTS.

RAO UES of Russia has determined the places of incorporation of Far East Generation Company (FEGC) and Far East Distribution Grid Company (FEDGC) being established as a result of the Far East power systems reform.

The volume of cross subsidies in the electric power industry currently estimated at RUR 60 bln, will be reduced by 14-15% annually and in 2008-2009 will be minimized, expects Igor Kozhukhovsky, Head of the Economic Policy Department of RAO UES of Russia (RTS: EESR).

The Strategy and Reform Committee of RAO UES of Russia has agreed to retain the shares of SUEK in West Siberian Heat Power Plant and South Kuzbass State District Power Plant of Kuzbassenergo after their sale, a meeting participant has told Reuters.

RAO UES of Russia (RTS: EESR) will hardly be able to complete its reorganization by the end of 2006, the deadline fixed by a protocol to the Russian Government’s decision made in December, 2004, says the power holding company’s CEO, Anatoly Chubais.

OJSC Gazprom (Russian Trading System: GAZP) is not interested in exchanging the shares of RAO UES of Russia (RTS: EESR) it owns for an interest in CJSC INTER RAO UES, a high-ranking source in Gazprom told Gas Information Agency. "Most likely, there will be no exchange," he claimed.

In the context of eliminating the problem of cross-subsidies in the power industry, RAO UES of Russia (EESR on the Russian Trading System stock exchange) suggests establishing a special social reserve (power availability insurance reserve) in the federal budget effective 2007 to compensate for an understated power price for socially important consumer categories to power suppliers.

Deadlines for the implementation of the power industry reform seem to have been shifted again. RAO UES of Russia was supposed to cease its existence before the end of next year. Realistically, this will not happen earlier than 2008, according to some internal RAO materials. Officials say the same and even Anatoly Chubais, Chairman of the RAO UES Management Board, is no longer as determined about the reform completion date as he used to be...

RAO UES of Russia has introduced ordinary and preferred shares of OJSC Nizhny Novgorod Generating Company, OJSC Arkhangelsk Sales Company, and OJSC Rostov Generating Company to CJSC Moscow Interbank Currency Exchange, according to a press release of the holding company.