ANNUAL REPORT 2010
FEDERAL GRID COMPANY
OF UNIFIED ENERGY SYSTEM
CONTENTS
•
•
•
•
Operating and Financial Highlights
2010 Key Events
Statement of the Chairman of the Board of Directors
Interview with the Chairman of the Management Board
6
8
14
16
1
ABOUT THE COMPANY
1.1 Organizational Structure
1.2 History
1.3 Market Overview
1.4 Geography
1.5 International Operations
1.6 Strategic Priorities
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26
28
29
34
35
38
2
PRODUCTION OVERVIEW
2.1 Electricity Transmission
2.2 Technological Connection
2.3 Reliability Improvement
2.4 Improving Energy Efficiency and Mitigating Losses
2.5 Maintenance and Repairs
2.6 IT Network Development
2.7 Procurement
40
42
44
45
54
56
57
62
3
INVESTMENTS AND INNOVATIONS
3.1 Investment Activities
3.2 Key Investment Projects
3.3 Innovative Development
66
68
78
84
4
ECONOMIC AND FINANCIAL PERFORMANCE
4.1 Tariff Regulation
4.2 Cost Optimization
4.3 Loan Portfolio and Liquidity
4.4 Credit Ratings
96
104
108
109
111
5
CORPORATE GOVERNANCE
5.1 Corporate Governance Principles
5.2 Board of Directors
5.3 Committees of the Board of Directors
5.4 Management Board
5.5 Remuneration to the Management Bodies
5.6 Internal Control System
5.7 Risk Management System
5.8 Share Capital
5.9 Stock Market
5.10 Dividend Policy
5.11 Investor Relations
112
114
117
122
128
135
137
141
147
151
154
155
6
SOCIAL RESPONSIBILITY
6.1 Social Responsibility Principles
6.2 HR Policy
6.3 Environment
6.4 Production Safety
156
158
161
167
170
ATTACHMENTS
•
2010 RAS Financial Statements and Audit Report
•
2009 RAS Financial Statements and Audit Report
•
2010 Management Discussion and Analysis (MD&A)
•
Compliance with the Code of Corporate Governance
•
2010 General Shareholders Meetings
•
Branches
•
Subsidiaries
•
2010 Interested Party and Major Transactions
•
Implementation of the Assignments of the President
and Government of the Russian Federation
•
Audit Commission Conclusions on the Veracity
of Information in the Annual Report
•
2011 Investor Calendar
•
Glossary
•
Contacts
172
192
208
226
236
238
240
246
250
253
254
255
258
OPERATING AND
FINANCIAL HIGHLIGHTS
KEY OPERATING
HIGHLIGHTS
Number of substations (units)*
Transformer capacity (MVA)*
805
804
800
2010
2009
2008
Electric energy output through
the UNEG to distribution companies,
direct consumers on the WECM
and independent
energoes (mln kWh)
Total length of electric energy
transmission lines (thousand km)*
121.7
121.1
121.5
2010
2009
2008
Electric energy output through the UNEG
to neighboring countries (mln kWh)
15,716.33
13,628.309
16,704.763
2010
2009
2008
Customer contract demand (MW)
2010
2009
2008
* Including leased facilities
6
90,057
94,636
90,042
311,007.93
306,422.35
294,126.84
2010
2009
2008
2010
2009
2008
470,648.072
452,662.172
471,958.118
Total real electric energy
losses (mln kWh)
2010
2009
2008
22,525.621
22,120.610
21,865.737
FEDERAL GRID COMPANY
ANNUAL REPORT
2010
KEY FINANCIAL
HIGHLIGHTS
Revenue from
operating activities
EBITDA*
111,085
2010
2009
2008
85,078
68,485
EBIT*
2010
2009
2008
68,301*
2010
2009
2008
40,379*
32,718*
Profit/ (loss)
before taxation
35,619*
2010
2009 -54,049
2008
16,962*
11,869*
68,319
6,177
Net profit/ (loss)
4,465
Market capitalization
56,000
32,980
764,162
579,746
666,471
2010
2009
2008
Debt and borrowing
2010
2009 13,000
2008
Net asset value
58,088
2010
2009 -59,866
2008
2010
2009
2008 141,882.2
452,717
367,971
*In order to calculate this figure, external factors are not taken into consideration in terms
of the responsibilities of the Company’s management (revaluation of financial investments,
creation of provisions for doubtful debts).
7
KEY EVENTS
2010
JANUARY
MARCH
26.01.2010
11.03.2010
Federal Grid Company made public its plans to construct seven objects in the Far East in 2010, including
introducing 50 MVA of additional transformer capacity and 391 kilometers of electric energy transmission
lines in the Far East.
Federal Grid Company completed construction of
the 500-kV Krymskaya substation and the 500-kV
Tikhoretsk – Krymskaya transmission line. In order
to realize this project, the Company invested a total
of RUR8.6 billion.
The Federal Financial Markets Service (FFMS) registered the Report on the results of the additional
share issue of Federal Grid Company. In total, during
the issue, 54.64% of additional share issue were
placed and RUR40,177,924,543.62 were received as
a payment for these shares.
20.03.2010
FEBRUARY
Federal Grid Company and Transneſt signed an agreement on cooperation for determining the interaction
between parties during the construction of external
power supply objects for the Eastern Siberia – Pacific
Ocean pipeline transportation system (ESPO-1, 2).
APRIL
04.02.2010
06.04.2010
Federal Grid Company put into operation the 500-kV
Peresvet substation (the Khanty-Mansi Autonomous
Region-Yugra), which entailed more than RUR6 billion
in investments. As a result, the Company upgraded
the reliability of the power supply to the Bistrinskoye,
Surgutskoye, Fedorovskoye, Lyantorovskoye, Bitemskoye, Nizhne-Sortimskoye and Ay-Pimskoye deposits
of Surgutneſtegaz, as well as the Priobskoye deposit
of Rosneſt Oil Company and for the Surgut Region
in Yugra.
18.02.2010
Federal Grid Company received an award for contributing to the development of a social partnership
from the All-Russian Industrial Union of Power Sector
Employers.
27.02.2010
Management Board adopted an innovative development and modernization policy for the Unified
National Electric Grid (UNEG), including development of the next generation electric grid in Russia –
smart grid.
8
Federal Grid Company signed agreements on cooperation with leading producers and developers of
electro-technical equipment in the Central Region
of Russia with the goal of achieving effective and
accident-free operation of local UNEG objects.
27.04.2010
Federal Grid Company and Rostelecom put into
operation the fiber optic telecommunication line
Chelyabinsk – Khabarovsk. This is the largest Russian
project in the field of constructing principal telecommunication lines during the last 10 years. The length
of the new fiber optic telecommunication line is approximately 10 thousand kilometers. Investment in
constructing this project exceeded RUR5 billion.
FEDERAL GRID COMPANY
MAY
19.05.2010
Federal Grid Company and Siemens AG Group concluded an agreement on strategic cooperation in
implementing new technologies at Federal Grid Company objects and developing the production of Siemens electro-technical equipment in Russia, as well
as servicing and maintaining Siemens equipment
installed at the Company’s power facilities.
JUNE
02.06.2010
Federal Grid Company created the Innovation Committee. The Committee’s main goal is to implement
the project to develop a smart energy system with
an active adaptive grid.
ANNUAL REPORT
2010
28.06.2010
Board of Directors adopted a resolution to increase
the Company’s charter capital by placing additional
common shares in the amount of 28,288,776,589
with a nominal value of RUR0.50 per share resulting
in an overall sum of RUR14,144,388,294.5. Funds
received as a result of the issue will be directed at
realizing the Company’s investment program.
29.06.2010
Annual General Shareholders Meeting took place. At
this meeting a decision not to pay dividends for 2009
was adopted. The Company’s shareholders adopted
the 2009 annual report and financial reports, elected
the Board of Directors and the Audit Commission and
selected the Company’s Auditor. The new version
of Articles of Association was adopted, as well as
numerous internal documents.
18.06.2010
JULY
Federal Grid Company and RUSAL signed an agreement on developing the production of new types of
wires for transmission lines.
07.07.2010
Federal Grid Company and European Bank for Reconstruction and Development (EBRD) signed an
agreement on mutual understanding stipulating the
intention of parties to broaden cooperation in the
field of upgrading the energy effectiveness of the
Russian economy by developing the UNEG.
21.06.2010
Federal Grid Company signed ten agreements with
producers and developers of electro-technical equipment, as well as with numerous Russian and foreign
partners. Agreements are aimed at the common
development and application of new technologies and
the most modern equipment in the electric grid.
Two Federal Grid Company projects – to create a
superconducting cable line and a transformer-type
controlled shunt reactor – were included in the 50
best innovative projects from leading Russian companies, as selected by Expert RA rating agency within
the “Innovative Activity of Large Russian Businesses”
study.
26.07.2010
Federal Grid Company and the State Electric Grid Corporation of China signed a framework agreement on
cooperation aimed at upgrading the effectiveness, reliability and safety of operating the Companies’ electric
grid infrastructure, as well as on implementing new
technologies.
9
KEY EVENTS
2010
AUGUST
12.08.2010
FFMS registered the resolution on the Company’s
additional issue of common shares and the Securities Prospectus.
17.08.2010
The Complex Program of MES South to prepare
the Sochi Region for the 2014 Winter Olympics
was adopted. Program realization will ensure
the reliable functioning of 66 10-220-kV substations, as well as 1,000 km of 10-220-kV electricity
transmission lines.
recognition from an expert council in the special category “For Best Practices in Corporate Governance and
Interactions with the Investment Community in 2010.”
The contest was organized by the Administration of
the Krasnodar Region with participation of Russian
Institute of Directors and FFMS.
28.09.2010
Federal Grid Company completed the public placement of Series 6, 8 and 10 bonds for a total of RUR30
billion, which was the largest public placement of
RUR-denominated corporate bonds in Russia.
OCTOBER
27.08.2010
06.10.2010
Federal Grid Company, RusHydro and Transneſt
signed an agreement on cooperation determining
the interaction between parties during the realization of investment projects for the external power
supply of the pipeline transportation system Eastern
Siberia – Pacific Ocean (ESPO-2) and the NizhnyBureyskaya HPP.
Federal Grid Company adopted the Program on implementing the Company’s 2011-2013 environmental policy, providing for the fulfillment of numerous
measures aimed at decreasing risks and minimizing
pollution of the surrounding environment, introducing
an ecological management system, organizing ecological audits and developing normative and technical
documentation in this sphere.
SEPTEMBER
08.10.2010
03.09.2010
Federal Grid Company announced the placement of
additional common shares. The cut-off date for the
placement was 4 February, 2011. Funds received
from the issue will be directed at implementing the
Company’s investment program.
20.09.2010
Federal Grid Company won the first place in a contest for 2009 annual reports in the category “Sector
Report: Infrastructure.” The Company also received
10
Board of Directors adopted Regulations on the Credit
Policy of Federal Grid Company. The need to adopt
this document was connected with the Company’s
plans to conduct an intensive credit policy taking into
account RAB regulation parameters.
29.10.2010
Federal Grid Company placed series 7, 9 and 11 bonds
for a total of RUR20 billion.
FEDERAL GRID COMPANY
NOVEMBER
10.11.2010
Federal Grid Company and Hyundai Heavy Industries
concluded an agreement on scientific and technical cooperation, the aim of which is to upgrade the
effectiveness, reliability and safety of electric grid
infrastructure, in particular, developing new technologies in the electric grid complex and implementing innovative equipment and ready solutions in the design,
construction and operation of energy objects.
ANNUAL REPORT
2010
15.12.2010
Board of Directors appointed STATUS as the Company’s registrar. At the same time, the Board of Directors adopted a resolution on dissolving the contract
for Central Moscow Depository to hold the contract,
based on FFMS annulling the registry holding license
(for Central Moscow Depository).
16.12.2010
Federal Grid Company received a passport of readiness for operating in the 2010-2011 autumn-winter
period.
Board of Directors adopted the Company’s 2010-2014
investment program. The program’s financing volume
is RUR952.4 billion. The program provides for the
large scale construction and reconstruction of electric grid objects, removing transmission constraints
for connecting new users and supporting power
output schemes from newly built power plants to the
country’s Unified Energy System.
20.11.2010
16.12.2010
The Company launched the first innovative Grid Control Center (GCC) in the MES Siberia branch. This
Center was created on the basis of the Kuzbass
Enterprise of main electric grids. Operative and
technological management functions for 10 energy
objects, including 110-220-kV transmission lines
and power equipment for the 220-kV Severny
Maganak substation, were transferred to the GCC.
Board of Directors adopted amended Regulations
on the Dividend Policy. The document provides for
the minimal amount of dividends and is based on
a transparent method for calculating dividend payments, taking into account the Company’s financial
results.
19.11.2010
DECEMBER
14.12.2010
As a part of realization of the Program for developing electric grids in the Sochi Region for 2010-2014,
the Company put into operation cable and overhead transmission lines (110 kV), the first order in
the Kгasnopolyansky Settlement District, the Laura
substation (110 kV, 2х40 MVA) and the Roza Khutor
substation (110 kV, 2х40 MVA).
22.12.2010
Federal Grid Company was named “Energy Company
of the Year.” The Company received an award for its
successful work in modernizing Russia’s main electric
grid complex on an innovative basis, as well as on
a tight schedule.
28.12.2010
Federal Grid Company summarized results of exercising the pre-emptive right to acquire additional
shares. A total of 22,386,785,410 shares were placed
at RUR0.50 per share, which represents 79.1%
of the total number of shares, for the total sum
of RUR11,193 million.
11
KEY EVENTS
2010
Federal Grid Company put into operation an experimental next generation digital substation. Its main
purpose is to develop various innovative technologies
prior to their introduction at UNEG energy objects.
30.12.2010
Federal Tariff Service (FTS) adopted Federal Grid
Company’s RAB-based tariffs for 2011-2014. The established regulation parameters will allow to finance
the 2010-2014 investment program, as well as to
implement the innovative development and UNEG
modernization program.
12
KEY EVENTS AFTER
THE REPORTING DATE
ANNUAL REPORT
2010
JANUARY
MARCH
26.01.2011
23.03.2011
Federal Grid Company started constructing the
220-kV Vladivostokskaya TPP-2 – Zeleny Ugol Volna
transmission line with an overall length of 15.4
kilometers, which will allow encircle the power supply
scheme of Vladivostok. This scheme will significantly
upgrade the reliability of the power supply for the
city’s consumers and will also allow for the connection
of APEC Summit objects to the Energy System of the
Primorsk Region.
FEBRUARY
An Extraordinary General Shareholders Meeting took
place, at which shareholders adopted the transaction
between Federal Grid Company and INTER RAO UES to
acquire additional shares of INTER RAO UES. According
to the transaction, additional shares of INTER RAO
UES were paid for by Federal Grid Company with
shares of the following energy companies: WGC -1,
RusHydro, OGK-2, WGC-3, OGK-4, OGK-6, TGC-1,
TGC-2, Mosenergo, Quadra, TGC-6, Volga Territorial
Generating Company (TGC-7), TGK-9, Fortum (TGC-10),
TGC-11, Kuzbassenergo (TGC-12), TGK-11 Holding,
Bashkirenergo, Yenisei TGC (TGC-13), TGK-14,
Sangtudinskaya HPP-1 and GruzRosenergo UES.
01.02.2011
28.03.2011
STATUS started servicing Federal Grid Company's
register of shareholders.
The trading of Federal Grid Company's depository
receipts began on the Main Market of the London
Stock Exchange under the “FEES” ticker symbol.
04.02.2011
Federal Grid Company completed placing its additional
share issue at a price of RUR0.50 per share. A total of
79.14% of shares from the additional issue – 22.39
billion shares – were placed for the sum of RUR11.193
billion. Funds received from the additional share issue
will be directed at upgrading the reliability of the
functioning of Sochi Region energy objects, due to
preparing for the 2014 Olympics and at implementing
the “Economic and social development of the Russian
Far East and Trans-Baikal for the period to 2013”
Federal Target Program.
13
STATEMENT OF THE CHAIRMAN
OF THE BOARD OF DIRECTORS
Dear shareholders!
Federal Grid Company was created in 2002 as part
of the reform of RAO UES of Russia. Since its creation the Company has achieved a lot and today
we are the foundation of Russia’s energy complex
and one of the country’s most important infrastructure companies. During the reporting year,
the Company recorded significant production results and strengthened its financial position, which
was possible due to effective work of our management team, intensive application of new equipment
and technologies, and active cooperation between
the Company and state officers.
Continuous improvement of national economy is
directly connected to power industry development,
which remains one of the most challenging branches
in the Russian fuel and energy complex (particularly
in terms of modernization). Energy companies are
focused on removing outdated run-down equipment
from operation and replacing it with new energy
efficient equipment. In connection with this, the
Government intends to launch a state policy to stimulate power industry innovation and undertake measures to upgrade energy saving and efficiency.
Another very important objective for development of
the power industry today is increasing the sector’s
attractiveness for investors. In the end of September
2010 the Russian Government allowed electric grid
companies to use a five-year regulation. As part of
this transition, Federal Grid Company developed a
2010-2014 investment program with a total volume of RUR952.4 billion. On 12 November, 2010,
this investment program was adopted by Russia's
Ministry of Energy. The program calls for large scale
construction and electric grid network rehabilitation
and the removal of connection limitations for new
consumers, ensuring power output schemes from
newly constructed power plants to Russia’s Unified
Energy System (UES).
It should be noted that our investment program will be
primarily financed with the Company’s own funds and
borrowings and to a significantly lesser degree with
federal budget funds. This is the result of transitioning to RAB regulation, which calls for tariff formation
14
based on the principle of returns on invested capital.
The new tariff estimation methodology makes the
Company’s business more understandable and attractive for investors. In autumn 2010 Federal Grid
Company successfully placed bonds with a total value
of RUR50 billion, which tells about the trust that
Russian and foreign investors have in the Company
and the Government’s policy of electric grid complex
development.
Federal Grid Company’s investment program calls for
supporting both existing assets and future corporate development, including implementing nationally
important large-scale investment projects. These
projects include ensuring stable and reliable power
supply for the Sochi Olympics, the APEC Summit in
Vladivostok and the ESPO. The program also provides
for carrying out modernization of the UNEG on an
innovative technological basis.
Federal Grid Company faces tremendous challenges
responding to which in many respects will determine
the level and dynamics of Russian economic development. We truly believe that our Company will be able
to successfully overcome all the difficulties and will
continue to work effectively for the benefit of both
Russia and our shareholders.
Sergey Shmatko
Chairman of the
Board of Directors,
Federal Grid
Company,
Minister of Energy
of the Russian
Federation
INTERVIEW WITH THE CHAIRMAN
OF THE MANAGEMENT BOARD
“A crucial year
in the development
of the main grid complex”
We discuss 2010 results
and the Company’s future
development with Oleg Budargin,
Chairman of the Management Board.
- What were the Company’s 2010 results?
- 2010 was a complex, but intense and productive
year for both our Company and the Russian power
sector in general. Taking into account the impact
of post-crisis economic development, Federal Grid
Company continued to adhere to reducing expenses,
as well as on optimizing resources and decreasing production costs. Our priority, with regard to
corporate activities, was to provide for the reliable
operation of the backbone grid complex and the
stable work of Russia's energy system, as well as
steady and uninterrupted electricity supply to our
customers. To achieve this, special attention was
given to implementing investment, repair and target
programs, upgrading the qualifications of operating
personnel and providing for increased preparedness
to prevent emergency situations. Measures taken by
the Company allowed it to successfully cope with the
2010-2011 autumn-winter maximum load, to prevent
emergency situations in electric power facilities even
during unusual weather conditions, and to avoid mass
limits on electricity supply to its consumers.
Moreover, 2010 was a year of modernization and
construction of new facilities, as well as adopting
fundamental tariff decisions. In fact, 2010 marked a
transition to a new level of the Unified National Electric Grid (UNEG) development. This year will surely
go down in the Company’s history as crucial for the
development of main electric grid complex. For the
first time, the Company adopted a five-year investment program that called for constructing seventythree 220-550-kV substations and more than one
16
hundred and twenty 220-750-kV transmission lines
with a total length of 21 thousand kilometers. We
also took numerous measures related to innovative
projects, achieved agreements with leading international electrical equipment producers, with regard to
constructing plants in Russia which will be manufacturing the newest equipment for the UNEG. I would
also like to point out one more very important event
for the Company. The event occurred in 2011, but
the foundation was primarily laid in 2010. In March
2011, the Company's Global Depository Receipts
(GDRs) were listed on the London Stock Exchange;
this will certainly improve the Company's investment
attractiveness.
- What were the principal financial and economic
results during the reporting year?
- During the reporting year, the Company implemented a broad range of measures to provide for
the stable operation of the backbone grid complex
and the UNEG development. In 2010 actual electric
supply by Federal Grid Company grids exceeded the
2009 figure by 4% and in balanced terms totaled
470.65 billion kWh. In neighboring states’ grids the
Company transmitted 15.72 billion kWh, which is 15%
more than in 2009. The 2010 increase in electric
supply was principally due to increased UNEG grid
consumption by large consumers (including industrial
enterprises).
During the reporting period, tasks aimed at decreasing the UNEG energy losses were fully accomplished.
The total energy saving effect in 2010 from optimiz-
FEDERAL GRID COMPANY
ing operating modes and managing electric grids, decreasing electricity consumption for the substations’
own use, as well as measures aimed at developing
electric grids and introducing energy-saving equipment, was 291,640 million kWh.
Net income growth in 2010 confirmed the Company’s
production success. This indicator stood at RUR58.1
billion, according to Russian Accounting Standards
(RAS). Income growth is due to higher revenues from
electricity transmission, as well as increased profit
from other activities as a result of the revaluation
of financial investments (based on current market
value). The increase in earnings before interest, taxes,
depreciation and amortization (EBITDA) was 69.1%
year-on-year. The principal factors driving EBITDA
growth were increased operational efficiency for
corporate activities due to transitioning to the new
tariff regulation system, effective cost management
activities and increased amortization payments, due
to introducing new capacity as a result of implementing the corporate investment program, as well as the
revaluation of fixed assets.
As of the end of the year, the Company’s credit portfolio stood at RUR56 billion and consists of bond
issues, most of which were successfully attracted in
2010 (RUR50 billion). These bond issues were aimed
at financing the investment program.
ANNUAL REPORT
2010
- What does modernization mean to Federal
Grid Company? How does it shape corporate
activities?
- Modernization can be very broadly interpreted
and in each company or economic branch it can be
understood and realized in a completely different
manner. Federal Grid Company defines modernization
as a concrete set of measures to bring the main
electric grid complex up to a new operating level in
the medium-term, via the use of the latest scientific
achievements and technologies. In other words, this
is not a general call for renovation, but a transparent
step-by-step program with certain objectives related
to all directions of the Company's operations:
technical policy, design, HR issues and cooperation
with specialized higher educational institutions, etc.
One of the Company’s long-term development
priorities is to create smart grids, which will be the
foundation of the future electric power industry.
These grids will decrease electricity transmission
losses and industry risks and prevent accidents in
substations and overhead transmission lines. In 2010
the Company started practical work on creating a
smart electric grid in Russia. We carried out work
to create territorial smart grid clusters in the Amur,
Primorsk and Khabarovsk Regions, as well as in
Russia's North-Western Region.
On the whole, the Company sees its financial and
economic results under the new tariff regulation
system during the reporting period as positive.
We maintained a high level of liquidity and financial
stability.
17
INTERVIEW WITH THE CHAIRMAN
OF THE MANAGEMENT BOARD
- What are the basic directions of Federal Grid
Company’s five-year investment program, which
was approved in 2010? How is construction of
electric grid facilities at the most important
construction sites moving forward, including at
major governmental projects such as Sochi-2014,
ESPO and others?
- Core directions of Federal Grid Company's investment
program include developing backbone electric grids in
Russian regions, providing capacity at new power units
of the generation facilities, upgrading the reliability
of regions with the highest power consumption levels
(Moscow, St. Petersburg and the Tyumen Region) and
providing electricity supply to facilities within the
framework of implementing priority State programs:
the Sochi Winter Olympic Games-2014, the APEC
Summit in Vladivostok (which will be held in 2012) and
the Eastern Siberia – Pacific Ocean pipeline (ESPO).
In particular, during new construction, expansion and
reconstruction of energy facilities, we completed and
switched on production capacity at 33 substations
and put more than 3,000 kilometers of transmission
lines into operation. The largest completed projects
included putting into operation new transmission
lines for providing production capacity to the
Volgodonskaya Nuclear Power Plant in the Rostov
Region and completing 220-kV grids for providing
production capacity to the Boguchanskaya HydroPower Plant (HPP).
During the reporting period our preparation for the
Sochi Winter Olympics consisted of completing the
first stage of constructing the 10-kV transformer
and distribution substation in the Sochi Region, as
well as constructing new cable transmission lines to
supply Olympic objects and wrap up the first stage of
constructing the Dagomys and Psou substations. In the
Primorsk Region to supply the APEC Summit objects
with electricity, the Company launched the Aeroport
substation and started building substations and four
transmission lines with a total length of more than 150
kilometers. The Company continued constructing and
reconstructing principal energy objects for electric
grid connections for objects of the Eastern Siberia –
Pacific Ocean pipeline, concluding capital repairs of
the 220/110/35/6-kV auto-connected transformer
18
with a capacity of 125 MVA at the reconstructed
Shirokaya substation in the Primorsk Region and
launching the second Neryungrinskaya GRES-Nizhny
Kuranakh transmission line in Yakutia.
In 2011 we plan to fully complete work to prepare
electric grid facilities for the APEC Summit –
ensuring capacity output of the Kalininskaya NPP
and implementing a significant portion of energy
efficiency measures at the Skolkovo Innovation
Center, the Sochi Olympics and the ESPO.
- What tasks will Federal Grid Company address
in 2011?
- The Company’s main task was and will continue
to be uninterrupted consumer power supply. In the
years to come, in regard to the UNEG development,
the Company faces the priority task of upgrading
operating system reliability and its modernization
and ensuring the economic and rational usage of
fuel and energy resources by upgrading the energy
efficiency of Federal Grid Company’s objects and
equipment. In the sphere of technological connection
services, the Company will significantly increase
the volume of connected capacities. We will also
continue to work on cutting electricity losses in the
UNEG. Furthermore, based on results of the planned
analysis of the main electric grid complex, we will
develop numerous additional measures to improve
the effectiveness and reliability of the UNEG.
As part of the corporate innovative development
program, in 2011, the Company plans to continue
creating smart grid and to increase the share of
domestically produced equipment used by the
Company.
Another important subject for the Company is investment program fulfillment. This will allow the
Company to increase the reliability of its services
for existing consumers and to connect thousands
of new consumers to the electric grid, as well as to
create necessary economic development conditions
in Russian regions, and the country as a whole, and
to provide power supply to objects constructed under
the auspices of important state projects. In total,
in 2011 the Company plans to put into operation
FEDERAL GRID COMPANY
more than three thousand kilometers of electricity
transmission lines and 26.6 thousand MVA of transformer capacity. At the same time, the Company
will carry out technical rehabilitation and reconstruction on one thousand five hundred energy objects. To ensure stable financing of this large-scale
investment, the Company will attract borrowed funds –
taking into account adopted tariff decisions using a
flexible and diversified approach to debt structure,
which will depend on the market situation as well.
Another major direction is working with personnel.
We fully understand that without highly qualified specialists capable of working with modern equipment
and technologies all corporate efforts in innovative
development will be completely ineffective. We cooperate with a wide range of universities to prepare
needed personnel. To enable a clear training system
and permanent career enhancement for employees,
last year we created a specialized personnel training
center. We also declared 2011 the Year of the Young
Specialist.
ANNUAL REPORT
2010
progressive companies in the power industry. We
care about adequately maintaining and developing
our electric grid network, paying significant attention
to renovating existing assets and implementing new
technologies. We actively develop both material
assets and new energy transmission technologies
and consistently work to decrease costs and improve
effectiveness. We continually upgrade corporate
governance in line with international best practice,
increasing share liquidity and attracting experienced
governance managers. All of this is aimed at
increasing the Company’s investor attractiveness
and maximizing shareholder value.
- And lastly, what would you like to say to the
Company’s shareholders and investors?
- I would like to express gratitude to all of the
Company’s shareholders and investors for investing in
Federal Grid Company and their continuing support.
We also definitely appreciate the significant attention
and support we have received from our major
shareholder – the Russian Federation.
Currently, Federal Grid Company is one of the most
19
MOVING FORWARD
WITH NEW ENERGY
ABOUT THE
COMPANY
ONE GRID –
ONE NATION
ANNUAL REPORT
2010
1.0
ABOUT THE COMPANY
PRODUCTION OVERVIEW
INVESTMENTS AND INNOVATIONS
ECONOMIC AND FINANCIAL PERFORMANCE
CORPORATE GOVERNANCE
SOCIAL RESPONSIBILITY
FACTS AND FIGURES 2010
121,700 KM
311,000 MVA
of total transmission
line length
of transformer capacity
13.6 MLN SQ. KM
98.58 %
RUR453.9 BLN
of area covered
by the Company
of revenues from
electricity
transmission
market capitalization
as of 30 December, 2010
RUR1 BLN
RUR952.4 BLN
investment in 2010 R&D
and pilot projects
2010-2014 investment
program
Federal Grid Company is the largest publicly traded
electricity transmission company in the world in terms
of the length of transmission lines and transformer
capacity. Its unique infrastructure is a backbone of
the Russian economy.
Federal Grid Company is the largest energy company
in Russia by market capitalization. Federal Grid’s
shares are included on the MSCI Emerging Markets
and MSCI Russia indices.
22
22,000 EMPLOYEES
The largest part of our revenues is generated via tariffs for electricity transmission, approved by the Russian Federal Tariff Services (FTS) based on the RAB
tariff regulation. Our major consumers are regional
distribution grid companies, retail electricity supply
companies and large industrial enterprises.
The future of the Company’s significant growth is
based on a large scale investment program, as well
as on our management’s commitment to innovation
and modernization.
FEDERAL GRID COMPANY
ANNUAL REPORT
2010
WHY FEDERAL GRID COMPANY?
01
Large scale operations
and stable demand
As a natural monopoly, Federal Grid Company is a
critical part of the Russian economic infrastructure
and the backbone of the national electricity sector.
Russian consumers’ stable demand for the Company’s
services underpins its long-term prospects, whereas
its role as the backbone of the country’s energy infrastructure reinforces its exclusive status.
(RAB). It allows the Company to improve operational efficiency, increase financial transparency and
ensure fair and predictable returns on invested
capital. The 2010 transition to RAB-based
regulation provided a stable cash flow and guaranteed financing of the Company's investment program.
In 2010 after switching to the RAB-based
regulation method, Federal Grid Company's
tariffs increased 51.1% compared with 2009.
04
02
State support
Playing a fundamental role in the Russian electricity
sector infrastructure, Federal Grid Company receives
significant support from the Russian Government.
In 2010 RUR11 billion was allocated from the Russian budget to improve the UNEG efficiency, to increase the capacity and stability of energy facilities
connected with the upcoming 2014 Olympic and
Paralympic Games in Sochi, and to finance “Economic
and Social Development of the Russian Far East and
Trans-Baikal for the Period to 2013” Federal Target
Program.
As the controlling shareholder of 79.48% of the
Company’s shares, the Russian Government actively
participates in our operations both through the Board
of Directors, which is chaired by Sergei Shmatko,
Russian Minister of Energy, and at the level of various
departments and regulatory bodies that coordinate
the deve-lopment programs and the electricity sector
regulatory framework.
03
Advanced Tariff Regulation System
The Company's electricity transmission tariffs are
calculated based on the Regulatory Asset Base
Reliability and Control
The UNEG reliability is maintained by the collective
efforts of our dedicated management team and personnel. The Company's multi-level internal technical
control system is aimed at maintaining an ample and
continuous electricity supply using organizational,
technical, informational, methodological, regulatory
and preventive measures.
05
Established development program
The Company's 2010-2014 investment program was
approved by the Russian Government on 12 November, 2010. Federal Grid Company prioritizes the
following program tasks: the UNEG development to
enhance its reliability; the implementation of agreements with regional authorities to ensure stable
electricity supply to consumers; the connection of
power generating units to the UNEG; and the development and implementation of technologies and
infrastructure to maintain and enhance a competitive
electricity and capacity market. Under the investment
program, the Company intends to invest more than
RUR952 billion between 2010 and 2014. Implementing this large-scale investment program is expected
to stimulate a robust expansion in the Company's
business and asset base.
23
1.0
ABOUT THE COMPANY
PRODUCTION OVERVIEW
INVESTMENTS AND INNOVATIONS
ECONOMIC AND FINANCIAL PERFORMANCE
CORPORATE GOVERNANCE
SOCIAL RESPONSIBILITY
Key Activities of Federal Grid Company:
•
Managing the UNEG
•
Providing electricity transmission services
and connecting WECM participants to the
electricity grid
•
•
•
Investment activities in UNEG development
Maintaining the electricity grid system
Engaging in the UNEG technical supervision
of the UNEG grid facilities
SWOT Analysis
Strengths:
Weaknesses:
•
•
•
•
•
•
•
•
Favorable tariff regulation regime (RAB)
Natural monopoly status
High level of state support
Government plans to retain
minimum 75% stake in the Company
Stable financial position
Market situation has little impact
on corporate cash flows; the majority
of revenues does not depend on actual
energy consumption
Experienced management team
Need to invest in grid asset
renovation given current depreciation
Opportunities:
Threats:
•
•
•
•
24
Asset growth through grid
construction to provide electric energy
to developing regions and new
infrastructure facilities
Considerable potential for upgrading
the business’ operating efficiency
via RAB regulation
Focus on innovative development
and use of the newest technologies
•
Absence of free cash flow due
to implementing a large scale
investment program
Regulatory risks connected with
changes in RAB regulation parameters
FEDERAL GRID COMPANY
ANNUAL REPORT
2010
Revenue by Activity
Revenue Structure
111,085
RUR mln
1,575
100,000
% from 2010
revenues
85,078
80,000
4,905
68,485
60,000
2,356
61,385
1,872
109,510
40,000
80,173
66,129
20,000
Year
59,513
2007
2008
2009
2010
Other operations
98.58% From electricity
transmission services
Electricity transmission
1.42%
From other operations
25
1.0
ABOUT THE COMPANY
PRODUCTION OVERVIEW
INVESTMENTS AND INNOVATIONS
ECONOMIC AND FINANCIAL PERFORMANCE
CORPORATE GOVERNANCE
SOCIAL RESPONSIBILITY
1.1
ORGANIZATIONAL
STRUCTURE
The General Shareholders Meeting is the supreme
management body of Federal Grid Company. The
Board of Directors provides strategic direction and
oversees Management Board functions. In turn, the
Management Board is entrusted to operate the Company.
As of 31 December, 2010, Federal Grid Company
comprises 51 regional branches.
Federal Grid Company’s
Organizational Structure
General Shareholders Meeting
Board of Directors
Management Board
Federal Grid Company's Regional Branches – Backbone Electric Grids (MES)
MES Center
MES NorthWest
MES Volga
MES South
MES Urals
MES
West Siberia
MES Siberia
MES East
Valdaiskoye
Bryanskoye
Lower
Volga
Kaspiyskoye
Permskoye
Central
Zabaikalskoye
Amurskoye
Upper Don
Vyborgskoye
Mid-Volga
Kubanskoye
Sverdlovskoye
Southern
West
Siberia
Primorskoye
Volga-Don
Karelskoye
Samarskoye
Rostovskoye
South Urals
Eastern
Krasnoyarskoye
Khabarovskoye
VolgaOkskoye
Leningradskoye
Stavropolskoye
MEC Urals
Motor
Transport
Enterprise
YamaloNenetskoye
Kuzbasskoye
Vologodskoye
Novgorodskoye
Sochinskoye
Omskoye
Orenburgskoye
Moscow
North
Khakasskoye
Nizhegorodskoye
Prioksoye
Chernozemnoye
26
Tomskoye
Special purpose
production centre
Bely Past
FEDERAL GRID COMPANY
ANNUAL REPORT
2010
Subsidiaries
In addition, as of 31 December, 2009, the Company has 29 subsidiaries
and dependent companies operating in various areas, including operating electric energy supply units. Two of these subsidiaries are backbone
grid companies: MES Tomsk and MES Kuban.
Subsidiaries and branches performing various types of activities, including the operation
of electric energy supply units of Federal Grid Company (share in the charter capital)
S&T Elektroenergetika (100%)
Nurenergo (77%)
IT Energy Service (39,99%)
Energy Forecasting Agency (APBE) (100%)
MES Tomsk (52,025%)
ENIN (38,24%)
UC Energetika (100%)
GruzRosenergo (50%)
UEUK (33,33%)
Elektrosetservice UNEG (100%)
GVC Energetiki (50%)
Voga Territorial Generation
Company (TGC-7) (29,99%)
MUS Energetika (100%)
SMUEK (49%)
TGC-11 (27,45%)
Glavsetservice UNEG (100%)
Severovostokokenergo (49%)
TGC-6 (23,58%)
ESSK UES (100%)
Energotechkomplekt (49%)
Bashkirenergo (21,27%)
CIUS EES (100%)
MES Kuban (48,99%)
Mobile GTES (100%)
Schekinskie PGU (45,21%)
CSRI NPKenergo (100%)
WGC-1 (40,17%)
Volgaenergosnabkomplekt (100%)
Index of Energy-FGC UES (100%)
More information about the Company's participation
in commercial and non-commercial organizations
is available in the Attachment.
Chitatekhenergo (100%)
27
1.0
ABOUT THE COMPANY
PRODUCTION OVERVIEW
INVESTMENTS AND INNOVATIONS
ECONOMIC AND FINANCIAL PERFORMANCE
CORPORATE GOVERNANCE
SOCIAL RESPONSIBILITY
1.2 HISTORY
Federal Grid Company was created in the course
of restructuring Russia’s electric energy sector. The Company
integrated under its management electric grid facilities that were
part of the UNEG. The number of Federal Grid Company’s
shareholders exceeded 470,000.
Federal Grid Company was founded as per Russian
Government Resolution “On Restructuring the Electric Power Industry of the Russian Federation” No.
526 dated 11 July, 2001. The reform was aimed at
upgrading the economic efficiency of the Russian
energy system and creating conditions to attractinvestments.
Federal Grid Company was formed as the organization responsible for managing, maintaining and
developing the UNEG.
Federal Grid Company was registered by the Russian
Government on 25 June, 2002. RAO UES of Russia,
as the sole founder of the Company, contributed the
backbone electric grid complex (related to the UNEG)
to the Company's charter capital.
Considering Federal Grid Company’s key position in
the sector, the Russian Government’s participation in
the corporate charter capital was legislatively set at
a minimum of 75% plus one voting share.
The Russian Federation, represented by the Russian
Federation Agency for State Property Management
(Rosimushchestvo), became the Company's shareholder in 2007 as a result of the additional share
issue. From 2007-2010 the Government's share in the
Company's charter capital was continuously growing.
As of 15 March, 2011, it stood at 79.48%.
While restructuring measures in the electric energy
industry were being carried out, electric grid units in
the UNEG under the management of Federal Grid
Company were being consolidated. In 2001 on the
basis of reorganized RAO UES of Russia subsidiaries,
28
56 regional electricity transmission grid companies
(MSKs) were created. MSK shares owned by RAO UES
of Russia were transferred to pay for the additional
issue of Federal Grid’s shares.
RAO UES of Russia reorganization was completed
1 July, 2008, when RAO UES of Russia and the companies spun off from it (the State Holding Company
and Federal Grid Company Minority Holding Company, seven inter-regional backbone grid companies
(MMSKs) and 54 MSKs) were integrated as part of
Federal Grid Company. Two MSKs (MES Tomsk and
MES Kuban) remained corporate subsidiaries. Shares
of the re-organized companies were converted into
shares of Federal Grid Company. The number of corporate shareholders exceeded 470,000.
In July 2008 Federal Grid’s shares were admitted
for trading on the Russian stock market. To improve
liquidity and protect the interests of former holders
of RAO UES of Russia's depository receipts (DRs),
in February 2008 the Company launched its own
DR program. Deutsche Bank Trust Company of the
Americas acts as the depository bank.
In November 2010 the Russian Government announced that it had approved the 2011-2013 privatization program. As part of this privatization program,
the Russian Government announced plans to sell
4.11% minus one share of Federal Grid Company.
FEDERAL GRID COMPANY
ANNUAL REPORT
2010
1.3 MARKET OVERVIEW
The Russian electric power sector is among the world’s largest,
ranking fourth globally in terms of both installed capacity and
electricity generation.
Major Electric Energy Producing Countries
Installed capacity, GW
Electric energy production, Twh
3,725
4,150
5,000
3,750
Japan
Russia
Since 1998, electricity demand in Russia has grown.
In 2010 it increased 4.3% to 1,009.2 billion kWh
(according to data from System Operator of the UES).
This is a record figure for the last ten years; this rapid
growth was possible due to 2010 weather anomalies
and the post-crisis economic recovery.
In Russia electricity consumption is characterized
by a relatively large share of demand coming from
the market’s industry and transportation segments.
According to Rosstat, in 2008 more than 50 % of electricity consumed was delivered to industrial consumers; household consumption accounted for only 11.4%
of total consumption.
Restructuring Russia’s Electric Power Industry
As early as the 1980s, it was clear that the country’s
electric power industry was stagnating. Production
capacity was upgraded much more slowly than electric
power demand increased. Moreover, while demand for
electric power decreased substantially in the 1990s,
India
France
Brazil
85
456
497
106
Canada
118
Germany
542
634
597
128
China
139
USA
156
212
0
870
957
1,115
281
797
1,250
1,025
2,500
UK
capacity upgrades ground to a virtual halt. According
to technological indicators, Russian electric companies
lagged behind their peers in developed countries, and
there was a lack of incentives to improve operating
efficiency and follow an intelligent plan for production and electric energy usage. Blackouts became a
regular occurrence in numerous regions, whereas the
absence of payment discipline called the very possibility
of electric companies being able to properly
function into question. The sector was not
transparent from a financial or information point
of view and entry was closed to new market players.
Consequently, it was paramount to electric power industry restructuring. Sector restructuring provided an
incentive to upgrade the efficiency of electric companies
and also created conditions for development. Industry
structure has changed: natural monopoly functions,
such as transmission and dispatching, were isolated
from potentially competitive ones, such as produc-
29
1.0
ABOUT THE COMPANY
PRODUCTION OVERVIEW
INVESTMENTS AND INNOVATIONS
ECONOMIC AND FINANCIAL PERFORMANCE
CORPORATE GOVERNANCE
SOCIAL RESPONSIBILITY
Year
Growth in electric power demand, %
1998
(0.5)
1999
3.0
2000
4.0
2001
1.3
2002
0.3
2003
2.9
2004
2.3
2005
1.8
2006
4.5
2007
2.3
2008
1.9
2009
(4.7)
2010
4.3
Sources: Rosstat, System Operator of the UES
tion and sale of electricity. As a result, companies
concentrating on individual types of operation
were created to replace previously vertically
integrated companies that had fulfilled all these
functions at the same time.
Thus, on the one hand, conditions to develop a
competitive electric power market were formed,
with prices based on supply and demand, while
market participants were interested in improving
efficiency. On the other hand, prerequisites were
also created in the natural monopoly sphere
for infrastructure development and upgrades
via effective government regulation and
disclosure for outside investors.
Russian Electricity and Capacity Market
Russia currently has a two-tier electricity and capacity
market (wholesale and retail).
30
WHOLESALE MARKET. Buyers and sellers in the
wholesale electricity and capacity markets include
generation companies, electricity exporters and importers, guaranteeing suppliers, electricity supply
companies, grid companies (to cover electricity losses
sustained in electricity transmission and distribution)
and large industrial consumers.
The wholesale electricity and capacity market operates
in the territory of regions which are unified in pricing
and non-pricing zones. The first pricing zone includes
the European part of Russia and the Urals, whereas,
the second pricing zone includes Siberia. In the second
pricing zone, the electric power price is lower than
in the first one, as Siberia has a higher share of hydrogenerating capacity with lower production costs
for electric energy.
In areas included in non-pricing zones (the Arkhangelsk
and Kaliningrad Regions, the Komi Republic and regions
of the Russian Far East), where electricity and capacity
market functioning on competitive conditions is not yet
possible, electricity sales are carried out under tariffs
determined by the FTS and special rules set by the
Russian Government.
Effective 1 January, 2011, electricity and capacity
are supplied based on unregulated prices, excluding
supplies to individual customers and other similar
customer categories.
RETAIL MARKET. Retail market participants include electric energy consumers, guaranteeing suppliers, retail suppliers, energy supply organizations,
public utility companies, grid organizations and other
owners of electric grid facilities, as well as producers (suppliers) of electric energy which is not sold
on thewholesale market.
The retail electric energy market functions, regardless of the wholesale market, with electric energy
consumers. Retail market rules establish a price
formation procedure on retail markets, a base for
interactions between all market participants, as well
as rules for receiving the status of guaranteeing
electricity suppliers, working with each consumer
based on a public offer and their selection based on
competitive bidding. Electricity supply to individual
Wholesale Electricity and
Capacity Market Participants
FEDERAL GRID COMPANY
Generation
ANNUAL REPORT
2010
Transmission
Distribution
Sales
Federal
Grid
Company
consumers is conducted in full based on regulated
tariffs. As of 1 January, 2001, for all other consumer
categories, electricity is supplied based on unregulated prices within the framework of the maximum
level of regulated prices.
•
Competitive sphere
•
Generating companies: Energoatom Concern,
RusHydro, wholesale generation companies
(WGCs) and territorial generation companies
(TGCs);
•
Electricity supply companies;
•
Guaranteeing suppliers;
•
Major consumers;
•
Exporters and importers of electric energy.
•
WECM infrastructure
•
Non-Commercial Partnership Market Council
for Organizing Efficient System for Wholesale
and Retail Trade in Electric Energy and Capacity
(Market Council);
•
•
Administrator of Trading System for the Wholesale Power Market (ATS);
Federal Grid Company of Unified Energy System
(Federal Grid Company);
System Operator of the Unified Energy System
(SO UES);
Center for Financial Settlements (CFS);
Governmental Regulations
of the Electric Energy Sector
The Russian Government exercises its powers in the
sphere of state regulation and control over electric
energy in accordance with Federal Law No.35-FZ «On
the Electric Energy Industry,» dated 26 March, 2003.
Federal executive bodies which have authority granted
by the Russian Government in regard to the electric
energy sector sector are:
The Russian Ministry of Energy
which is entrusted with developing state policy
31
1.0
ABOUT THE COMPANY
PRODUCTION OVERVIEW
INVESTMENTS AND INNOVATIONS
ECONOMIC AND FINANCIAL PERFORMANCE
CORPORATE GOVERNANCE
SOCIAL RESPONSIBILITY
and regulations in the field of the fuel and energy
complex, including electric energy issues;
The Federal Tariff Service (FTS)
which provides state regulation of prices (tariffs) for
products and services, including establishing tariffs
for electric energy transmission;
The Federal Antimonopoly Service (FAS)
which provides antimonopoly regulation in the electric energy industry;
The Federal Service for Environmental,
Technological and Nuclear Supervision
(Rostekhnadzor)
which carries out technical control and surveillance
in the electric energy sector, as well as licensing
certain types of activities and verifying compliance
with Russian legislative requirements in the electric
energy industry.
The Russian energy sector is managed by two organizations. On the one hand, the Russian Ministry
of Energy acts on behalf of the state as the sector’s
regulator and coordinator. On the other hand, the
Market Council organizes trade in electric energy
and capacity in the wholesale market in accordance
with the Rules of the Wholesale Market, as approved
by the Russian Government resolution, and uses
market self-regulation mechanisms in fields established by the Rules of the Wholesale Market.
Federal Grid Company manages the UNEG. Federal
Grid Company’s right to provide electricity transmission services is established by law. The rights
of owners of electric energy facilities representing
a part of the UNEG, in particular, the right to provide
electricity transmission services, were delegated
to the Company.
The Unifi ed National (All-Russian)
Electric Grid (UNEG)
comprises a network of electricity grids and
other electric-grid facilities ensuring the
constant supply of electric energy to consumers, a functioning wholesale market, as
well as the simultaneous operation of Russia’s electric energy system and the electric
energy systems of foreign countries.
The rated nominal voltage class, characteristics of transmission capacity, electric
energy fl ow reversibility and other technological characteristics of grids included
in the UNEG are approved by the Russian
Government.
Currently, criteria for assigning electricity facilities to the UNEG (approved by
Russian Government Resolution No. 41, as of
26 January, 2006) are in effect.
In compliance with the Federal Law “On the Procedure for Implementing Foreign Investments in Commercial Enterprises that Have Strategic Importance
for Providing National Defense and State Security”.
Federal Grid Company has a strategic role with regard to national defense and state security. Furthermore, the Company is included in the Russian
Government’s List of Strategic Organizations
compiled by the Governmental Commission for Increasing Russian Economic Stability in 2008 to national defense and state security.
Federal Grid Company has the status of a natural
monopoly. The Company does not have competitors
in the market for electricity transmission via the
UNEG. Federal Grid Company’s market share stands
at 100%.
32
Information on implementation of the assignments of the President and Government of the Russian Federation
you can fi nd at the Attachment.
FEDERAL GRID COMPANY
ANNUAL REPORT
2010
FEDERAL GRID COMPANY’S ELECTRICAL
GRID FACILITIES
Federal Grid Company operates
more than 121,000 kilometers of
transmission lines and 805 substations
with a total transformers capacity
exceeding 311,000 MVA.
Number of substations
as of 31.12.2010
8
99
3
1
Quantitative Structure of Federal Grid Company’s
Overhead Transmission Lines based on Voltage
Class as of 31.12.2010
33
6
1,194
1,200
64
900
591
600
206
300
110 kV
330 kV
500 kV
1 150 kV
1 4 14
kV
1
110 150
3
14
1
3
220 330 400 500 750 800 1 150
35 110 150 220 330 400 500 750 800 1 150
kV
220
330
400
500
750
1,066.93
110
4,772.26
35
30,387.46
37, 500
792.182
948.800
75,000
19,345.24
113,250.28
141,359.92
112, 500
377.885
126.360
10
1,127.590
6
0.906
137.740
kV 0,4
60.895
35.068
0
1.489
20,000
10,578.894
60,000
40,000
35
150, 000
3,076.158
80,000
10
MVA
33,599.809
km
6
67
137
Substations’ Capacity
as of 31.12.2010
71,582.401
Length of Federal Grid Company’s Overhead
Trasmission Lines as of 31.12.2010
0,4
7
23.66
35 kV
220 kV
400 kV
750 kV
1 150
33
1.0
ABOUT THE COMPANY
PRODUCTION OVERVIEW
INVESTMENTS AND INNOVATIONS
ECONOMIC AND FINANCIAL PERFORMANCE
CORPORATE GOVERNANCE
SOCIAL RESPONSIBILITY
1.4 GEOGRAPHY
The scale of the UNEG corresponds to Russian territory.
The total length of our electricity transmission lines
is more than 121,000 kilometers.
The grid covers an area of approximately 3,000 kilometers from North to South and more than 9,000
kilometers from West to East.
The Company has 805 substations with a total installed capacity of 311,000 MVA. The northernmost
substation which is part of the Kolskaya Energy
System is located in Murmansk; the southernmost
substation is situated in Derbent, Dagestan. From
west to east, the grid spans from the Primorye to
Kaliningrad Regions.
The Chukotka, Kamchatka, Taimyr, Yakutia, Magadan
and Sakhalin Territories are not included in the UNEG,
as of yet. At the moment, economic conditions do not
exist to construct the backbone electricity grids and
large substations in these under-populated regions
that lack major consumers. Autonomous electric grids
work in these territories.
The UNEG is connected with 137 inter-state electricity transmission lines with contiguous countries;
electricity import and export is conducted via these
lines.
Federal Grid Company's electric grid facilities are
located in 73 Russian regions with a total area of
more than 13.6 million square kilometers. The territory in which the Company operates is divided into
zones; one of the Company's branches - backbone
grid companies (MES, PMES) – is responsible for the
appropriate zone.
34
Regions covered
by Federal Grid Company
73
RUSSIAN REGIONS WITH A TOTAL AREA
OF MORE THAN 13.6 MILLION SQUARE KILOMETERS
FEDERAL GRID COMPANY
ANNUAL REPORT
2010
1.5 INTERNATIONAL OPERATIONS
In compliance with Federal Law No. 35-FZ “On the Electric Energy
Industry,” dated 26 March, 2003, Federal Grid Company is an organization that manages the UNEG. Starting 1 January, 2004, Federal
Grid Company acts as a transmitter of electric energy through the
Russian customs border.
Federal Grid Company provides electricity transmission services up to the Russian customs border in compliance with the agreements with
INTER RAO UES via its electric grid facilities that are
a par t of the UNEG and are owned or leg a l l y
operated by Federal Grid Company.
Information about Inter-State Electricity
Transmission Lines (IETL)
In compliance with Russian Government Resolution
No.41, dated 26 January, 2006, electricity transmission lines that cross the Russian border correspond
with Criteria for Assigning Electricity Facilities in the
UNEG.
Federal Grid Company collects and processes information about electricity transmission via 137 interstate electricity transmission lines (IETL).
To provide electric energy to Russian consumers in
the Bryansk, Pskov and Kaliningrad Regions, Federal
Grid Company has concluded agreements with appropriate organizations of Latvia, Lithuania, Estonia
and Belarus for paying for electric energy transit via
these states’ electricity grids.
In compliance with the agreement on measures providing for the simultaneous operations of the UES
of Russia and Kazakhstan concluded by the Russian
Government and the Government of the Republic of
Kazakhstan dated 20 November, 2009, an electric
energy transit agreement was signed. Pursuant to
the signed agreement, Federal Grid Company pays for
electricity transit through the territory of Kazakhstan
beginning in May 2010.
On 15 March, 2011, an agreement on measures providing for the simultaneous operations of the UES
of Russia and Belarus was signed by the Governments of the Russian Federation and the Republic
of Belarus.
In accordance with these agreements and an intergovernmental agreement on provision of access to
natural monopoly services (including price formation
and tariff policy basics) concluded by the Russian
Federation, the Republic of Kazakhstan and the Republic of Belarus, it has become possible to conduct
the inter-state transmission of electricity between
countries-members of the common economic area,
including through grids of the Russian UES.
Simultaneously Operating the Russian UES
and the UES of Foreign Countries
Currently, five agreements on simultaneous operating of the UES of the Russian Federation and electric energy systems of foreign countries have been
concluded by Federal Grid Company and economic
agents of the following countries: Georgia (an agreement on simultaneous operation of Russia’s and
Georgia’s electric energy systems, dated 16 March,
2011), Mongolia, Kazakhstan, the Baltic States and
the Republic of Belarus, as well as an inter-system
agreement with Finland. Additionally, the Company
signed technical support agreements on simultaneous operations with the Ukraine, the Republic of
Belarus and Azerbaijan.
35
1.0
ABOUT THE COMPANY
PRODUCTION OVERVIEW
INVESTMENTS AND INNOVATIONS
ECONOMIC AND FINANCIAL PERFORMANCE
CORPORATE GOVERNANCE
SOCIAL RESPONSIBILITY
Moreover, Federal Grid Company cooperates with
the State Grid Corporation of China (SGC of China) to
comply with the following documents that were signed
in 2010:
•
•
On 26 July, 2010, Federal Grid Company and the
SGC of China signed a framework cooperation
agreement aimed at jointly examining issues connected with the organization of the Unified Energy
Systems of Russia and China, cooperating in the
electric energy sphere, exchanging information,
experience and knowledge with the organization
of consultations and meetings related to the issue
of utilizing the newest technologies, engineering,
research work, manufacturing and the operation
of electric energy equipment.
On 23 November, 2010, Federal Grid Company,
INTER RAO UES, MRSK Holding and the SGC
of China concluded an agreement to fulfill the
Memorandum of Understanding aimed at cooperation in the sphere of electric grid sector development signed 27 September, 2010 by Russian
Ministry of Energy and the State Energy Directorate of China.
Federal Grid Company provides
electricity transmission services up
to the Russian customs border in
compliance with the agreements
with INTER RAO UES via its
electric grid facilities that are a
part of the UNEG and are owned
or legally operated by Federal Grid
Company.
In accordance with this document, the parties intend
to strengthen cooperation and experience exchange
in the field of modernizing electric grids, to upgrade
grid reliability and safety and to take part in modernizing and reconstructing the parties’ electric grids.
Federal Grid Company, as the organization that manages the UNEG, including inter-state electricity transmission lines for all voltage classes, carries out the
following activities:
•
•
•
36
Coordinating and offering technical support for
INTER RAO UES’s commercial agreements to
export and import electric energy;
Organizing and implementing commercial accounting for electric energy transmitted via interstate
electricity transmission lines;
Establishing and carrying out customs clearance
for factual volumes of electric energy transmitted
across the state border in compliance with agreements on organizing the accounting of electric
energy and capacity transmission via inter-state
electricity transmission lines, as concluded with
foreign counterparties.
Within the framework of an agreement on measures
providing for the simultaneous operation of the UES
of Russia and Kazakhstan, which was concluded by
the Governments of the Russian Federation and the
Republic of Kazakhstan, an agreement providing for the
fulfillment of commercial agreements to settle deviations from the agreed planned transmission schedules
based on hourly data for commercial accounting signed
by Federal Grid Company and KEGOC is in effect.
Federal Grid Company works on developing and upgrading relationships with foreign energy systems in regard
to issues of harmonizing the countries’ legislation in
the electric energy sphere, forming and synchronizing electric energy and capacity markets within the
framework of inter-governmental events (UES of the
CIS countries and its commissions (including COTC), the
Committee of Energy Systems of BRELL, the EURASEC
Integration Committee, working groups in the Executive
FEDERAL GRID COMPANY
ANNUAL REPORT
2010
Comparison of Federal Grid Company with
Leading Foreign Grid Companies
120,000
100,000
80,000
60,000
40,000
20,000
Federal Grid Company
(Russia)
Lietuvos Energija
(Lithuania)
ISA Group
(Latin and Central America)
Transelectrica
(Romania)
Transener
(Argentina)
CTEEP
(Brasil)
TAESA
(Brasil)
Power Grid Corp
(India)
SP AusNet
(Australia)
National Grid
(UK, USA)
RTE
(France)
Fingrid
(Finland)
REN
(Portugal)
Terna SPA
(Italy)
Red Electrica
(Spain)
ITC Holdings Corp
(USA)
ELIA
(Belgium)
0
International Peers
Federal Grid Company is the largest publicly traded electricity
transmission company in the world in terms of length
of transmission lines and transformer capacity.
Committee of the UES of CIS countries, with Fingrid
(Finland), KEGOC (Kazakhstan), the State Energy
Concern Belenergo (Belarus), within the framework
of energy conversations between Russia and the
European Union, as well as interactions with Asian
countries (China and South Korea).
37
1.0
ABOUT THE COMPANY
PRODUCTION OVERVIEW
INVESTMENTS AND INNOVATIONS
ECONOMIC AND FINANCIAL PERFORMANCE
CORPORATE GOVERNANCE
SOCIAL RESPONSIBILITY
1.6 STRATEGIC
PRIORITIES
Federal Grid Company is a reliable, efficient and dynamically
developing company. It strives to become an innovative leader
in the Russian electric energy sector and is focused on increasing
the well-being of its shareholders and investors. We stand by the
following strategic priorities for activities and development:
Reliability
Development
and Innovations
Safety
Strategic
Priorities
Operating
Efficiency
38
Corporate Governance
and Shareholder Value
FEDERAL GRID COMPANY
Reliability
High-voltage electricity transmission lines represent
one of the key infrastructure elements of the Russian economy. Federal Grid Company’s strategic role
established our core priority: the reliable and stable
transmission of electric energy across the country.
The Company’s upgraded technical policy is aimed at
further increasing equipment reliability via renovating existing facilities and implementing the newest
technologies.
Development and Innovations
Considering the Russian economy’s transition to an
innovative development path, the Company is actively
working on upgrading the technical characteristics
of electricity grids and infrastructure facilities. Our
five-year investment program is focused on modernizing existing facilities and upgrading the electricity
transmission grid to satisfy modern energy sector
requirements. The Company is constantly seeking
an innovative approach and the newest technological solutions to be used in production management.
Among our most important initiatives is the development and implementation of smart grids – efficient
and blackout-proof, protected against hazardous
natural phenomena and economically sound to use.
Implementing this project will enhance the UNEG
reliability and efficiency, resulting in an up to 3.6%
reduction in electricity transmission losses.
Safety
The life and health of the Company’s personnel, as
well as the industrial and environmental safety of
our facilities, are key priorities for Federal Grid
Company. The Company is constantly upgrading
the industrial and consumer safety level, introducing new environmental protection technologies
and carefully managing related risks. We closely
collaborate with Russian regulatory authorities to
meet and exceed applicable safety standards.
ANNUAL REPORT
2010
Operating Efficiency
Our business’ immense size and the fact that the
Company is a monopoly in the market give us considerable advantages, including: financial stability,
steady growth and the possibility to effi ciently
manage risks. The Company uses its strengths to
upgrade operating effi ciency. The transition to the
advanced RAB-based regulation, stimulated reduction in operating costs, the implementation
of energysaving technologies, the optimization
of operating and management regimes and the use
of cost effective equipment to cut electricity transmission losses, as well as improvements in the internal audit and IT systems contribute to the Company
achieving its goals.
Corporate Governance
and Shareholder Value
The Company adheres to corporate governance
principles based on the Russian Corporate Governance Code adopted by Russia’s Federal Commission
for Securities Market (FCSM), and corporate governance requirements which are applicable to Russian
public companies. The Company strives to comply
with best international practices in this sphere. Strict
conformity with corporate governance standards
and investments in human capital development allow
our shareholders to contribute to the Company’s
overall success.
The strategy aimed at maximizing the Company’s
shareholder value is based on our business’s immense
size, which will expand due to the ambitious investment program and stable demand. The RAB-based
regulation is a signifi cant incentive that contributes
to upgrading operating efficiency and guaranteeing
a return on investment. Optimizing the capital structure and approving a new dividend policy that conforms
to best corporate standards will also enable increases
in shareholder value.
39
MOVING FORWARD
WITH NEW ENERGY
ANNUAL REPORT
2010
PRODUCTION
OVERVIEW
ENERGY
OF INNOVATION
TO A CLEAR GOAL
2.0
ABOUT THE COMPANY
PRODUCTION OVERVIEW
INVESTMENTS AND INNOVATIONS
ECONOMIC AND FINANCIAL PERFORMANCE
CORPORATE GOVERNANCE
SOCIAL RESPONSIBILITY
2.1 ELECTRICITY TRANSMISSION
Federal Grid Company’s principal operating activity is transmitting
electricity from large generators through backbone grid lines,
which form the Unified National Electric Grid (UNEG), to distribution
grids (which supply power to end consumers).
In accordance with Russian legislation, this is a monopoly activity and is subject to state regulation.
Payments for electricity transmission services are the
primary revenue source for the Company’s budget.
In 2010 the share of revenue from the Company’s
electricity transmission services accounted for more
than 98% of the Company’s total revenues.
500,000
Federal Grid Company operates 1,652 electricity
transmission lines with a total length of 121,700 km
and 805 substations with a total transformer capacity of more than 311,000 MVA.
250,000
Currently, there are five agreements on parallel operations of the Russian UES with electric power systems
of foreign states, with Federal Grid Company and
business entities of Georgia, Mongolia, Kazakhstan,
the Baltic States and the Republic of Belarus as parties of the agreements. There is also an Inter-System
Agreement with Finland and Agreements on Technical Support for Parallel Operations were signed with
the Ukraine, the Republic of Belarus and Azerbaijan.
In 2010 consumers of Federal Grid Company’s electricity transmission services included 150 organizations connected to the UNEG.
Consumers of the Company’s services
include five types of organizations:
•
•
•
42
Distribution grid companies (DGCs)
Independent grid companies (GCs)
Energy sales companies (ESCs)
Power Output,
mln kWh
471,958
464,046
470,648
452,662
375,000
125,000
2007
•
•
2008
2009
2010
Major power-consuming enterprises connected
directly to the UNEG
Electricity exporters
FEDERAL GRID COMPANY
ANNUAL REPORT
2010
The Share of Federal Grid Company's Largest Consumers in 2010 Revenues
from the UNEG-Based Electricity Transmission Services
№
Counterparty
Share, %
1
Tyumenenergo
2
Moscow United Electric Grid Company (MOESK)
7.8
3
MRSK Urals – Sverdlovenergo
5.1
4
Lenenergo
4.5
5
MRSK Siberia – Kuzbassenergo
3.6
6
Far East Distribution Company
3.2
7
Kubanenergo
3.1
8
MRSK Urals – Chelyabenergo
2.6
9
MRSK South – Rostovenergo
2.5
10
MRSK Siberia – Krasnoyarskenergo
2.4
10.4
Increase in Number of Federal Grid Company’s Consumers
of the UNEG-based Electricity Transmission Services
Consumers of Federal
Grid Company’s
Services
16%
1%
121
100
105
42%
20%
50
21%
DGCs
GCs
ESCs
150
150
Large
enterprises
Exporters
2008
2009
2010
43
2.0
ABOUT THE COMPANY
PRODUCTION OVERVIEW
INVESTMENTS AND INNOVATIONS
ECONOMIC AND FINANCIAL PERFORMANCE
CORPORATE GOVERNANCE
SOCIAL RESPONSIBILITY
2.2 TECHNOLOGICAL CONNECTION
Technological connection is one of the most important factors
ensuring growth in the Russian industrial sector. Federal Grid
Company makes every effort to provide new consumers with
technological connection to the UNEG.
Technological connection is a set of measures aimed
at connecting the power equipment of legal entities
and individuals to Federal Grid Company’s grid facilities. Technological connection services are available
to new consumers and to existing consumers who
need increased consumption capacity.
Scope of Responsibility for Electric Grid
Companies in Technological Connection
Federal Grid Company provides consumers with technological connection to electricity grids that according to approved criteria are part of the UNEG and
are owned or used by the Company. The responsibility
for technological connection to grids and control
over the procedure falls under the scope of responsibility for either the executive office of Federal Grid
Company or its branches – Backbone Electric Grids
(MES) – provided that a customer’s application meets
the following criteria:
Technological
connection
voltage
44
Executive office
of Federal Grid
Company
Branches
of Federal Grid
Company – MES
220 kV
and above
below 110 kV
inclusively
The scope of responsibility for Federal Grid Company’s
executive office also includes technological connection related to increasing transmission capability,
changing the connection schemes of existing transmission lines or constructing new ones including
overhangs of 220 kV and above.
Technological
Connection
Technological connection
is a set of measures aimed
at connecting the power
equipment of legal entities
and individuals to Federal Grid
Company’s grid facilities.
FEDERAL GRID COMPANY
ANNUAL REPORT
2010
Number of agreements signed and maximum
capacity under terminated agreements
№
Branch
2008
2009
Number of
agreements
Maximum
capacity, MW
2010
Number of
agreements
Maximum
capacity, MW
Number of
agreements
Maximum
capacity, MW
1
MES Center
61
0
49
32.87
107
110.38
2
MES Siberia
14
6
44
28.112
75
64.065
3
MES East
27
0.2
36
29.9
43
24.51
4
MES Urals
19
0.2
11
77.16
22
6.4
5
MES South
14
0
18
16.175
48
99.623
6
MES Volga
12
36.225
13
76.661
22
129.62
7
MES North West
33
0
78
43
47
85.554
8
MES West Siberia
21
0
35
606.4
67
59.3
9
The executive office
67
169.15
57
699.9
36
589.15
268
211.78
341
1,610.2
467
1,168.6
Total
2.3 RELIABILITY IMPROVEMENT
Technical Policy
Federal Grid Company's Technical Policy is a system
of goals, methods and forms of influence aimed at
achieving a set of new technical solutions that ensure
upgraded efficiency, reliability, technical development,
industrial safety and the creation and development
of new technologies and electricity transmission methods. The Technical Policy is laid out by a fundamental document – Regulations on Federal Grid Company's Technical Policy.
Technical Upgrading
and Reconstruction Outlook
Insufficient financing for Russian electric grid facilities, which began in the 1990s, has led to critical wear
on fixed assets. Analyzing the age structure of equipment installed at the Company’s facilities indicates
that the normative service life (25 years) has expired
for more than 54% of equipment. The above-level
service life (35 years and more) has expired for more
than 22% of Federal Grid Company’s equipment.
Regulations on Technical Policy were approved by
Federal Grid Company's Board of Directors (Minutes
No. 123, as of 8 February, 2011).
The share of equipment with above-level service life
is also expected to demonstrate significant growth
during the next decade.
45
2.0
ABOUT THE COMPANY
PRODUCTION OVERVIEW
INVESTMENTS AND INNOVATIONS
ECONOMIC AND FINANCIAL PERFORMANCE
CORPORATE GOVERNANCE
SOCIAL RESPONSIBILITY
Age Structure of Federal Grid
Company’s Equipment
Age Structure of
Substation Equipment, %
7.50%
4.50%
22.20%
17%
36%
4.10%
47%
9.70%
14.60%
Age Structure of
Transmission Lines, %
19.50%
17.90%
18%
43%
0-5 years
6-10 years
11-15 years
16-20 years
21-25 years
26-30 years
31-35 years
39%
35 years
The physical and moral depreciation of equipment
can lead to technological disruptions, accidents and
increased maintenance expenses. Worn-out structural units for transmission lines can be damaged by
external influences or cause increased electricity
losses as a result of a larger load.
In 2010, Federal Grid Company draſted an activity
plan aimed at modernizing and retro-fitting electric
grids with several unique focuses based on estimating the current technical state and production
capabilities of the Russian industry and construction
companies.
Fixed Asset Renewal Program
The Company has developed the 2011-2016 Program
for Fixed Asset Renovation – a program which strives
to ensure electric grid facility reliability and efficiency.
As estimated by the Company, with Renovation Program financing of RUR60 billion per year, Federal Grid
Company will be able to break the trend of higher
equipment wear-and-tear.
The Renewal Program involves:
•
The total launch of 69,147 MVA of capacity
(till 2016);
•
Reconstruction of more than 3,860 km of transmission lines;
46
0-24 years
25 years
(normative
service life)
35 years
(above-level
service life)
•
0-24 years
25 years
(normative
service life)
35 years
(above-level
service life)
Installation of 1,416 groups of 110-750-kV disconnecting switches, 4,245 circuit breakers of 110-750-kV
and 1,712 groups of 11-750-kV current and voltage
measuring transformers
Total financing for the 2011-2016 Fixed Asset Renovation Program is RUR355,714 million. Out of this
amount, approximately 55% will be spent on the
comprehensive reconstruction of the Company’s
1,015 facilities, including 198 substations and 61
transmission lines.
In 2011 the Company plans to adjust the financing
plan for its Renovation Program and to modify the
scope of work based on targets met in 2010. In 2011
the total capacity of facilities launched aſter comprehensive reconstruction will exceed 8,901 MVA.
Reliability Improvement Programs at the
UNEG Facilities
The decline in electricity consumption during the late
1980s and early 1990s and the resulting underuse of
grid transfer capacity, which lasted until 2006-2008,
coupled with the physical wear and tear of equip-
FEDERAL GRID COMPANY
ANNUAL REPORT
2010
2011-2016 Renovation Program Financing
Renovation programs
2011-2016, RUR mln
196,941
Comprehensive reconstruction
Non-comprehensive reconstruction
46,805
Program to replace 330-750-kV air circuit breakers (ACB)
12,055
Program to replace 110-220-kV oil circuit breakers (OCB),
isolating switches and short circuiting switches (IS and SCS)
25,220
Lightning-surge protection improvement program
under investment operations
7,219
Program to procure and construct pre-fabricated
buildings for special machinery
1,748
Program to replace 110-750-kV current transformers (CT)
at Federal Grid Company’s facilities
4,091
Program to replace 110-750-kV voltage transformers (CT)
at Federal Grid Company’s facilities
2,613
Target program for investment operations
800
Program to develop the diagnostic system
402
Modernization and technical upgrading program
for electricity transmission lines
48,398
Auto-transformer replacement program
2,581
Fire safety improvement program
at the Company’s units
1,141
Emergency reserve development, purchase of equipment,
materials, special machinery and gear
4,800
Reserve program
TOTAL
ment, contributed to a reduction in the number of
large systemic accidents that resulted in electricity
supply shortages to consumers. However, the UNEG
900
355,714
facilities will face an increasingly larger load as electricity consumption grows and the share of electricity
and capacity sales in the wholesale market increases.
47
2.0
ABOUT THE COMPANY
PRODUCTION OVERVIEW
INVESTMENTS AND INNOVATIONS
ECONOMIC AND FINANCIAL PERFORMANCE
CORPORATE GOVERNANCE
SOCIAL RESPONSIBILITY
tion and measuring systems of electricity revenue metering and can also damage substation
equipment and result in accidents. The Company
plans to replace 2,534 CT sets and 1,867 VT sets.
The cost of this Program will be RUR6.7 billion.
To upgrade the reliability of its current grid facilities,
the Company has decided to develop and implement the following Reliability Improvement
Programs:
1. Program to replace 330-750-kV air and
oil circuit breakers (ACB)
According to corporate data, 30% of the total
number of technological violations at substations is caused by circuit breaker breakdowns.
Air and oil circuit breakers are also characterized by long idle periods caused by technical
maintenance and repairs (TMR), which forces
substations and grids to operate in the weaker
repair mode. Gas-insulated circuit breakers, hich
the Company plans to install, require maintenance with disconnection only once every 12
years, which improves the reliability of substations and grids, simplifies the repair procedure,
contributes to cost reduction and reduces accident risk. Under the Program, the Company will replace 3,802 sets of circuit breakers.
The total Program cost is RUR37.28 billion.
2. OTL lightning-surge protection improvement program
According to statistics, 30% of the total number
of technological violations at overhead transmission lines (OTL) is caused by lightning strikes.
Lightning results in damages to isolators, towers
and cables, causes ground faults, arc overvoltage and automatic shutdowns. The OTL lightning-surge protection improvement program
involves modernizing approximately 2,500 km
of overhead lines, installing 18,500 surge protection devices and creating the AIMSSLC
(automated information and measurement system of sleet load control) at overhead lines of MES
South. The Program will cost RUR7.219 billion.
3. Programs for replacing the 110-750-kV
current and voltage transformers
Breakdowns of current (CT) and voltage-measuring transformers (VT) are the reason for more
than 5% of the total number of technological disruptions at substations. CTs and VTs, with a service life of 30 years and more, fail to ensure the
accuracy grade needed for automated informa-
48
4. Modernization and technical upgrading
program for electricity transmission
lines
The share of electricity transmission lines with a
service life exceeding 40 years is 29.2%, with the
share of lines with a service life of more than 50
years accounting for 8.9% of the total length of
Federal Grid Company’s electricity transmission
lines. According to corporate data, the 20112016 renovation program, as applied to electricity transmission lines, will result in the natural
ageing of equipment exceeding comprehensive reconstruction of electricity transmission
lines under the renovation program (3.1% of the
total length of electricity transmission lines). This
highlights the serious need for an additional program to modernize electricity transmission lines.
The cost of this program will be RUR48.4 billion.
5. Autotransformer replacement program
The goal of this program is to upgrade transformer equipment with a service life of 40 years
and above, reduce the number of technological
violations related to power transformers, upgrade
the reliability of the UNEG equipment, slow down
transformer ageing and increase their capacity.
The total cost of the program is RUR2.6 billion.
6. Fire safety improvement program at
the Company’s units
Its aim is to reconstruct and upgrade fire safety
tools at the Company’s units. The program will
help reduce the number and scale of accidents
at the Company’s units, while also reducing the
possibility of industrial injury incidents. The
total cost of the program is RUR1.14 billion.
7.
Emergency reserve development and
the purchase of equipment, materials,
special machinery and gear
The program’s aim is to upgrade and increase
the Company’s fleet of special machinery, ma-
FEDERAL GRID COMPANY
terials and gear to upgrade the quality and
speed of construction and repair work, simplify repair procedures and reduce costs. The
total cost of the program is RUR4.8 billion.
Improved Electric Grid Maintenance
Improving electric grid maintenance will improve the
UNEG reliability and lower current costs needed to keep
principal UNEG elements operable. Measures taken by
the Company to improve maintenance include:
1.
Improving service maintenance for equipment, which involves comprehensive equipment
diagnostics at the service centers of producers,
technical maintenance and diagnostics by the
Company’s personnel and emergency response
activities by the Company’s personnel led by the
chief engineers of plants that made the equipment;
2. Developing an intelligent troubleshooting
system that enables the Company to monitor
equipment under operational voltage and introducing a repair planning system based on integrated results of an intelligent diagnostic system;
3. Professional training for the Company’s
production personnel via the creation of Production Training Centers at the Company to train
employees in accordance with unified standards,
methods and forms, using specialized training
infrastructure, such as grid training grounds.
Technical Surveillance of the Company’s
Electricity Grid Facilities
Federal Grid Company has a multi-level internal monitoring system (IMS) which oversees organizational,
technical, informational, procedural, monitoring and
preventative activities at corporate branches and the
UNEG units to upgrade equipment’s operating efficiency
and personnel training and to reduce the number of
emergency incidents and the probability of fire and
injury.
To improve IMS reliability, the Company carried out
the following measures in 2010:
ANNUAL REPORT
2010
•
•
Revising existing normative documents and developing new ones that cover methodological,
informational and administrative support for
the IMS taking into account structural changes
at Federal Grid Company and analyzing results
for the IMS currently in place;
Changing the approach to evaluating efficiency
at the Company’s branches, subsidiaries and
dependent companies, based on technical audit
results.
In 2010 the Company’s Technical Monitoring and
Audit Department ensured technical monitoring and
audit inspections across all Federal Grid Company
branches. The results formed the basis for planning
and implementing measures to remedy drawbacks
identified by the inspections, in accordance with
deviations from existing requirements.
Electric Grid Equipment Troubleshooting
In October 2009 Federal Grid Company established
the Division for Monitoring the Grid Technical Status
and Troubleshooting, which formed the foundation
for a new working group in troubleshooting system development. The group includes experts in
related areas, the heads of branch troubleshooting
departments and representatives of the Company’s
R&D unit.
Technical troubleshooting of electric grid equipment
is regularly performed, as part of specific (targeted)
troubleshooting or as automated (online) troubleshooting.
Regular trouble shooting encompasses tests and
measurements in accordance with current regulatory documentation. Throughout 2010 the Company
performed the following regular tests and measurements (TM) on its primary high-voltage equipment:
•
•
•
Power transformers and auto-transformers:
12,068 TMs;
Shunt reactors: 1,027 TMs;
High-voltage circuit breakers: 42,096 TMs;
49
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ABOUT THE COMPANY
PRODUCTION OVERVIEW
INVESTMENTS AND INNOVATIONS
ECONOMIC AND FINANCIAL PERFORMANCE
CORPORATE GOVERNANCE
SOCIAL RESPONSIBILITY
•
•
Current transformers: 9,021 TMs;
Voltage transformers: 4,190 TMs.
Specific (targeted) troubleshooting assesses
the technical condition of electric grid equipment
not encompassed in regular troubleshooting and
specifies the level and nature of defects discovered
during regular troubleshooting. It includes the following programs:
•
An electric grid overhead transmission line
(OTL) special troubleshooting program based
on express troubleshooting techniques.
Inspection results and recommendations help the
Company make timely decisions on exact repairs to
carry out on tower parts or the comprehensive reconstruction of OTLs based on their actual condition.
In 2010 comprehensive inspections were carried
out on 9,931 towers of OTLs. According to inspections, 1,418 towers had defects that affected the
reliability of OTL usage.
•
The top-priority special troubleshooting program for the UNEG OTL parts.
In 2010 9,784 towers for OTLs were inspected
under auspices of this program. According to
these inspections, 2,008 towers had defects that
affected the reliability of OTL usage.
•
Comprehensive inspection program for
substation grounding
In 2010 comprehensive inspections were carried
out at 271 substations.
Reconstruction of the substations’ grounding systems, including repairs, replacement and post-repair
measurements and tests, was planned for 2011-2012
based on reports on the technical condition of inspected substations.
•
Special troubleshooting program for deteriorated equipment or units
In 2010 inspections, as part of the special trouble-
50
shooting program, were carried out at 6,482 main
equipment units and 113 towers of OTLs. Lightningsurge protection troubleshooting was carried out at
97 spans of OTLs.
•
Special troubleshooting program for water obstacle crossings
In 2010 63 crossing towers underwent a comprehensive inspection to prevent operational disruptions.According to the inspection, 25 crossing towers
had defects that affected the UNEG reliability.
To complete technical troubleshooting of electric
units in a quicker and more up-to-date manner, the
Company uses automated troubleshooting systems
(monitoring systems), firstly for capital-intensive
power equipment: power (auto) transformers and
shunt reactors. As of 31 December, 2010, the total
amount of constantly monitored power equipment
consists of 314 units with a total capacity of 43,936
MVA (220 units) and 7,234 MVAR (94 units).
In 2010 the Company carried out troubleshooting on
electric grid equipment affected by extremely high
air temperatures and wildfires.
To ensure the UNEG’s reliable performance in areas
affected by extremely high air temperatures and
wildfires in 2010 (MES Center, MES Volga and MES
South), the Company carried out ad hoc troubleshooting of its power, communication, measurement
and protective equipment, including: comprehensive
thermal imagery inspection of electric units at 257
substations; testing transformer oil for high voltage equipment (using chromatographic analysis of
oil-solved gases and physical and chemical testing) at 846 equipment units; testing excess voltage
suppressors at 10 substations; testing 330-750-kV
measuring transformers (271 phases); unscheduled
inspections, probes and measurements of OTL units
across 51 territories.
Comprehensive inspection of power equipment with manufacturer involvement
To enhance the readiness of capital-intensive power
equipment to deal with maintenance loads in 2010
the Company completed comprehensive maintenance
FEDERAL GRID COMPANY
In October 2009 Federal Grid
Company established the Division for Monitoring the Grid
Technical Status and Troubleshooting, which formed the
foundation for a new working
group in troubleshooting system development.
ANNUAL REPORT
2010
a high-traction box truck – 18 units (for troubleshooting measures at high-voltage electricity
transmission lines), equipped with 260 units of
machinery and troubleshooting complexes.
In 2011 Federal Grid Company plan to focus troubleshooting efforts in the following areas:
•
•
•
•
•
•
of power equipment with manufacturer involvement
(Minutes of the Meeting of the Council of General
and Chief Designers, Leading Scientists and Academicians of High-Tech Industries of the Russian Prime
Minister No. 4 as of 7 December, 2009).
In 2010 Federal Grid Company upgraded and completed equipment at its machinery and troubleshooting complexes.
In 2010 to improve troubleshooting quality, Federal
Grid Company provided the following machinery and
troubleshooting supplies to production facilities at
the Company’s branches – MES/PMES:
•
•
•
Equipment for fixed-site laboratories – 380 units;
Movable electric power laboratories – 34 units
(for testing/measuring substation equipment),
equipped with 330 units of machinery and troubleshooting complexes;
Movable troubleshooting laboratories with
Developing a methodological and normative
database to apply and use results from troubleshooting automated equipment;
Creating and developing an automated system to manage the Company’s troubleshooting
activities (Diagnostic Automated Management
System – AMS);
Utilizing ongoing automated troubleshooting measures for the Company’s electric units
capable of automatically transferring results to
the Diagnostics AMS;
Developing and using modern techniques and
tools for the non-destructive testing of the
Company’s modern electric grid equipment;
Developing a professional training (skills
improvement) system for personnel involved in
troubleshooting;
Organizing ongoing professional training for
personnel at service centers and production
facilities for manufacturers of high-voltage
equipment used at Federal Grid Company units.
•
Efficient Process Management
The principal goal of Federal Grid Company’s efficient
process management is to fulfill obligations to deliver
electric energy to the market by adhering to deliver
quality and reliability requirements, and to minimize
losses when transmitting electric energy via the
UNEG. The Company’s efficient process management
is built on a hierarchical approach, with a concise
equipment allotment as per efficient implementation levels.
In 2010 the Company successfully achieved the
above-mentioned goals and has demonstrated the
following results:
•
There were 19 technological violations caused
by operational staff errors (compared with 32
violations in 2009 and 16 in 2008);
51
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ECONOMIC AND FINANCIAL PERFORMANCE
CORPORATE GOVERNANCE
SOCIAL RESPONSIBILITY
•
•
•
•
•
Standard violations caused by higher than allowed voltage levels in the UNEG did not exceed
3, as with 2009 (compared to 9 in 2008 and 71
in 2007);
Federal Grid Company’s branch MES Volga developed and implemented a system for optimizing
the grid mode by voltage and reactive power
based on KOSMOS drive end (DE);
the North-West Grid Control Center is running
a project to implement a modern PSI Controlbased hardware and soſtware package to complete the entire range of tasks related to the
grid’s efficient process management;
in accordance with the Efficient Process Management Concept approved in 2010, the GridControl Center of Kuzbasskoye PMES took over
operational management functions;
the Company and System Operator approved
a shared basis of managing switchovers at new
generation substations.
With involvement of efficient process management
departments, Federal Grid Company designs and
commissions new generation substations (at the
end of 2010, they accounted for 8% of the Company’s total number of substations), where modern
automated systems of equipment control are being
implemented. With these systems in place, operational maintenance of substations can become a duty
of grid control centers. The switchover to substations
with operational staff on site permanently on duty
will help reduce maintenance expenses, reduce the
time needed to eliminate technological violations,
andsimultaneously analyze the situation both on the
site and in the grid linked to the substation.
Special Period Results
As a rule, the autumn-winter period results in the maximum capacity load for Russia’s electric energy system,
and harsh weather conditions during the freshet period,
fire-hazard period and storm period increase the risk of
damage to grid units. As a result, Federal Grid Company
pays particular attention to electricity transmission during special periods.
52
In some Russian regions, the 2010 freshet period resulted in precipitation levels significantly above normal
and the danger of snow melt negatively impacted the
UNEG grid units. During the 2010 spring freshet period,
employees of the Company’s regional branches carried
out all planned measures to ensure reliable performance. Substations’ equipment, overhead transmission
lines, buildings and facilities were in good working condition following the freshet.
All measures to prepare the UNEG grid units for storm
and fire-hazard periods were carried out in full by the
Company’s employees. No breakdowns in electricity
transmission line elements or substation equipment
were reported due to storm-related excess voltage.
Compared to the previous year, there were 99 additional cases of shutdowns due to storm-related excess
voltage. The increase was reported across grid units
of MES East, MES West Siberia, MES Center and MES
North-West. Compared to the previous year, there was
no increase in the number of emergency equipment
shutdowns at the Company’s substations. To reduce
the volume of storm-related shutdowns, the Company
developed and approved a three-year lightning-surge
protection improvement program for overhead transmission lines.
As a result of ongoing dry weather and extremely
high air temperatures in numerous Russian regions
during the summer of 2010, the Russian President
signed off on a state of emergency decree for the Republic of Mari El, the Republic of Mordovia and the Vladimir, Voronezh, Moscow, Nizhny Novgorod and Ryazan
Regions. Federal Grid Company rolled out additional
measures to upgrade fire safety levels across territories
where the state of emergency was announced – in
particular, those within the scope of responsibility for
MES Center and MES Volga.
During the period of extremely high air temperatures,
the Company carried out significant additional activities
to ensure the UNEG reliability and to avoid major damage to overhead transmission lines. Tower parts, cables, isolators and line accessories were in good working
condition. However, despite measures taken, the impact
of extremely high temperatures damaged equipment at
several substations.
FEDERAL GRID COMPANY
ANNUAL REPORT
2010
Following forest fires that affected overhead transmission line routes, the Company’s employees removed
burnt trees from the routes and checked the condition
of transmission line elements. This minimized consequences of the wildfires for substation and transmission
line equipment.
Preparation of the Company’s branches for the
2010-2011 autumn-winter period involved preliminary
examinations of the branches’ readiness and respective
measures to eliminate identified drawbacks. By November
2010, all corporate branches received a passport
of readiness for the 2010-2011 autumnwinter season.
On 16-19 November, 2010, a commission of the Russian
Ministry of Energy, acting in conjunction with Federal
Grid Company personnel and the Federal Service for
Environmental, Technological, and Nuclear Oversight
(Rostekhzadzor), inspected Federal Grid Company’s
readiness for the 2010-2011 autumnwinter season.
On 19 November, 2010, the inspection was deemed
successful and Federal Grid Company received passport
readiness no. 1 for the autumn-winter season.
53
2.0
ABOUT THE COMPANY
PRODUCTION OVERVIEW
INVESTMENTS AND INNOVATIONS
ECONOMIC AND FINANCIAL PERFORMANCE
CORPORATE GOVERNANCE
SOCIAL RESPONSIBILITY
2.4 IMPROVING ENERGY EFFICIENCY
AND MITIGATING LOSSES
The program to decrease 2010 electric energy losses in the UNEG
is part of Federal Grid Company's 2010-2012 Energy Saving
and Energy Efficiency Improvement Program, which was approved
by the Company’s Management Board 24 December, 2010.
In 2010 the Program to reduce the UNEG electric
energy loss had three key components:
•
Optimizing the scheme and parameter modes for
electric grid maintenance and operating management;
Lowering power consumption to meet the own
needs of the substations;
Commissioning energy-saving equipment.
•
•
As part of the efforts to optimize operating conditions and manage the electric grids, optimum operation for reactive power and voltage was maintained,
electric grid equipment (transformers and OTLs)
was shut off during light-load operation and the
period for repair and technical maintenance of the
main grid equipment was shortened. Reductions in
auxiliary power requirement necessitate optimizing
the performance of cooling fans for transformers
and auto-transformers and for heating and lighting
resources at the buildings that manage substations.
The Company also worked to optimize the load on
electric grids by building new substations and lines.
In accordance with the Energy Saving and Energy
Efficiency Improvement Program, Federal Grid Company plans to conduct an energy audit.
In the future the Company plans to conduct an equipment performance inspection to identify locations
with the highest losses and to develop additional
measures for the Company to reduce electricity
losses in the UNEG and to amend current planned
targets.
In 2010 the total actual loss of energy was 22,525.621
million kWh, based on power balances in the UNEG.
Annual Energy Losses in 2008-2010
Dimension
2008
2009
2010
million kWh
21,866
22,121
22,526
%
4.63%
4.89%
4.79%
Relative amount of energy losses is defined to the volume of the balanced energy output
from the UNEG to Federal Grid’s consumers.
54
FEDERAL GRID COMPANY
ANNUAL REPORT
2010
Quantitative
effect as of 31
December, 2010,
MWh
Energy efficiency measures implemented
since 1 January, 2010
Optimization of the electric grid steady-state conditions
(per reactive power, per voltage))
40,645.1
Switch-off of electric grid equipment during light-load periods
75,794.3
Reductions in the length of time for the repair and technical
maintenance of the main grid equipment (lines and transformers),
including hot-line work
26,852.0
Lowering power consumption for the substations own needs
67,050.8
Installing and commissioning power factor
correction units in electric grids
2,880.0
Replacing overloaded power transformers and commissioning
additional ones at operating substations
2,181.0
Replacing measuring current transformers
71,522.4
Optimizing the electric grid load by constructing
new substations and lines
4,714.4
Total
291,640.0
Breakdown of 2010 Energy
Losses in the UNEG, %
1%
2% 2%
24%
5%
8%
58%
Federal Grid Company obtains power independently
on the wholesale market, to compensate for actual
net output loss in the UNEG, minus losses taken
into account and paid for by market participants
at equilibrium prices. The cost of power and capacity obtained by Federal Grid Company in 2010 to
compensate for losses was RUR14,183,210,183.61,
excluding VAT: RUR2,630,340,176.34, excluding VAT
for power energy, and RUR11,552,870,007.27, excluding VAT for capacity.
Loss on shunt reactors 2%
Loss on compensating devices 1%
Loss to corona discharge via overhead transmission lines 24%
Other losses 2%
Load loss 58%
Loss on auxiliary power requirements 5%
Off-load loss on transformers and autotransformers 8%
55
2.0
ABOUT THE COMPANY
PRODUCTION OVERVIEW
INVESTMENTS AND INNOVATIONS
ECONOMIC AND FINANCIAL PERFORMANCE
CORPORATE GOVERNANCE
SOCIAL RESPONSIBILITY
2.5 MAINTENANCE AND REPAIRS
Via its maintenance and repair activities, Federal Grid Company has the
following goals: to upgrade the reliability of the UNEG, to improve usage
efficiency for the Company’s equipment, and to effectively utilize resources
to develop and maintain the UNEG.
Maintenance and repair activities are based
on the following principles:
•
•
•
•
•
•
•
•
Complying with normative and technical documents;
Minimizing increases in technological and economic risks;
Analyzing technological violations;
Overseeing the results of implementation from
previous periods;
Adhering to legislative requirements and limits
established for applicable electric companies;
Meeting key performance indicators;
Remaining within budget limits;
Complying with regulatory requirements.
Starting in 2011, Federal Grid Company will base its
maintenance and repair program on a rolling schedule with a planned five-year horizon and one-year
steps.
•
•
•
•
•
As part of its 2010 repair campaign, the Company
carried out the following activities at its units:
•
•
•
•
•
Principal types of maintenance and repair
for Federal Grid Company include:
•
•
•
•
•
•
•
•
•
56
Grid line clearing;
Replacing insulators;
Repairing and strengthening the foundation
for overhead transmission line support;
Replacing protective earth wires;
Replacing vent fingers;
Repairing and strengthening supports
for the overhead transmission lines;
Repairing automatic transformers/transformers;
Repairing reactors;
Repairing bushings;
Repairing disconnecting switches;
Repairing circuit breakers;
Replacing stick-pedestal insulators for circuit
breakers and bus structures;
Repairing compressors;
Repairing storage batteries.
Clearing more than 29,000 ha of electricity
transmission line routes;
Replacing 52,101 isolates and 172 km of protective earth wires;
Repairing and strengthening 1,326 supports at
overhead transmission lines;
Working on 302 phases of auto-transformers, 18
phases of shunt reactors, 2,267 disconnecting
switches, 7,332 circuit breaker phases and 235
compressors;
Replacing 129 bushings.
Principal priorities for the 2010 Target
Programs include:
•
•
•
•
•
•
•
A porcelain insulation replacement program for
overhead transmission lines;
A protective earth wires replacement program
for 220-500-kV overhead transmission lines;
Grid-line clearing program;
Chemical cleaning program for grid lines;
High-voltage bushings replacement program;
Reliability improvement program for optical IC;
Program for restoring the reserve phase to normative conditions.
FEDERAL GRID COMPANY
As part of the Target Program, the Company carried out the following activities:
•
Clearing more than 24,370 ha of electricity
transmission line routes;
•
Logging 1,730 trees that could potentially fall
on electricity transmission line cables;
•
Replacing 713 high-voltage bushings, 30,367
stick-pedestal insulators, 140,870 porcelain
insulators and 2,002 km of protective earth
wires.
ANNUAL REPORT
2010
In 2010 total financing for the Company’s maintenance,
repairs and target programs was RUR12,436 million.
During the reporting period, the Company met 106%
of its technical maintenance and repair plan, which represents a 6.7% improvement compared with 2009. All
necessary repairs and technical maintenance activities
at the UNEG units during the review period were carried
out in full and on schedule.
2.6 IT NETWORK DEVELOPMENT
The Unified Electric Power Technological
Network (UEPTN)
Cutting-edge telecommunications systems and
state-of-the-art IT solutions are integral to Federal
Grid Company’s successful performance. The Company realizes the importance of this factor and works
to create and develop the Unified Electrical Power
Technological Network (UEPTN).
The UEPTN is based on the widespread use of up-todate digital communication lines and is delivered by
creating fiber optic communication networks, radio
relay links (RRL), modernizing high-frequency communications, expanding the satellite communication
system, digital mobile radio, wavelength-division
multiplexing (WDM), synchronous digital hierarchy
(SDH), time division multiplexing (TDM) and Internet
protocol (IP) communications.
ule (General Schedule for the UEPTN Set-up and
Development till 2015), which was approved by Federal Grid Company’s Management Board and the
Government Commission.
In 2010 total financing for the
Company’s maintenance, repairs and
target programs was RUR12,436
million. During the reporting period,
the Company met 106% of its
technical maintenance and repair
plan, which represents a 6.7%
improvement compared with 2009.
All necessary repairs and technical
maintenance activities at the UNEG
units during the review period were
carried out in full and on schedule.
Strategic Telecommunications Planning
In 2009, Federal Grid Company’s Management
Board approved the 2009-2015 Telecommunications
Management Strategy. In line with this strategy,
the key goals for managing telecommunications include: providing consumers with reliable telecommunications services, switching the UEPTN to digital
technologies and optimizing capital expenditures to
develop the telecommunications network, in addition
to operation and modernization expenses.
The set-up and development of the UEPTN will take
place in four stages, as per the applicable sched-
57
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The first stage (2005-2008): setting up a digital
backbone network for Federal Grid Company based
on proprietary telecommunications platforms and
establishing a unified electrical power digital network
(UEPDN) on leased circuits.
The second stage (2009-2010): completing
development of the UEPDN, allowing all corporate
branches to communicate and use digital communication lines at substations (277 substations).
The third stage (2011-2013): creating a digital
distribution network to fully switch the MES East
electric grid units (69 substations) and the MES
North-West electric grid units (103 substations) to a
digital format. In addition, the Company plans to set
up digital communication lines for electric grid units
in other regions (184 substations).
The fourth stage (2014-2015): completing setting up principal telecommunications platforms for
the electric energy industry, including digitalizing 86
electric grid units.
In 2010 Federal Grid Company’s Management Board
decided to develop the UEPDN in conjunction with
a leading telecommunications operator, due to
Federal Grid Company’s switchover to telecommunications services provided via the digital transportation network, which is based on UEPDN resources
and the operators’ telecommunications networks.
As a result, in 2010 the Company outlined the main
cooperation principles and set up a pilot zone at
Federal Grid Company’s branches – MES Volga and
Urals. To implement the telecommunications service
provision model, Federal Grid Company decided to
provide its 100%-owned subsidiary Moscow Communication Center of the Electric Power Industry (MUS
Energetiki) with the functions of the Trust Operator,
with its principal duty being providing the Company
with a modern high-quality range of telecommunications services, in addition to maintenance and
technical services for telecommunications systems
and means.
In 2010 24-hour shiſts for the Center for Telecommunications Network Control and Monitoring started
operating on the basis of MUS Energetiki at Federal
Grid Company’s branches.
58
Latest Changes in the UEPDN Structure
Fiber optic lines:
As part of fiber optic telecommunications network development, in 2010 the Company commissioned the
1st, 3rd and 5th launch sites for the Chelyabinsk – Novosibirsk – Tayshet – Vladivostok fiber optic line (with a
total length of 5,285 km and 77 facilities).
By the end of 2010, the total length of the Company’s
backbone and distribution fiber optic telecommunications networks stood at 26,564 km.
Radio relay network
The radio relay network is used in the backbone and
distribution networks of the UEPTN, either primarily
in a situation in which it is not economically rational
to install a fiber optic line or when a telecommunications network is required urgently.
In 2010 Federal Grid Company was allowed to use
radio frequency or radio frequency channels on 9
radio relay telecommunications lines in coverage
areas for the Bryansky, Stavropolsky, YuzhnoUralsky, Severny, Chernozemny and Verkhne-Donskoy
PMES (MES subsidiaries). The Company also provided
the State Unitary Enterprise “General Radio
Frequency Center” with 28 radio frequency applications with the source data to receive inspection results on the possibility of using radio electronic means
and their electromagnetic compatibility with radio
electronic means currently in operation or intended
for future use.
Satellite network
The satellite network enabled Federal Grid Company
to upgrade reliability and observability at its electric
grid units.
In 2010 as part of the first stage of Federal Grid
Company’s Program for Reliability and Observability
Improvement, the Company set up satellite channels
for dispatching and technological management and
the transmission of telemechanics data from 20
substations in the coverage area of Federal Grid Company’s MES North West branch and 16 substations
in the coverage area of Federal Grid Company’s MES
Center branch to respective Grid Control Centers of
Federal Grid Company’s branches and dispatch cen-
FEDERAL GRID COMPANY
ANNUAL REPORT
2010
Murmansk
Yamburg
Salekhard
Loukhi
Nadym
Pechora
Severodvinsk
Planned Scheme for
Federal Grid Company’s
Fiber Optic Line till 2015
Urengoy
Arkhangelsk
Tarko-Sale
Kholmogory
Syktyvkar
Noyabrsk
Petrozavodsk
Khanty-Mansiysk
Vyborg
Sosva
St.Petersburg
Surgut
Nizhnevartovsk
Yakutsk
Vologda
Cherepovets
Kingisepp
Manturovo
Galich
Rybinsk
Novgorod
Pskov
Bologoye
Udomlya
Kirow
Perm
Kostroma
Yaroslavl
Nizhny Tagil
Tyumen
Votkinsk
Ivanovo
Izhevsk
Ioshkar Ola
Nizhny Novorod
Kezan
Tver
Rzhev
Moscow
Kaluga
Smolensk
Ryazan
Orel
Kursk
Sterlitamak
Syzran
Tambov
Penza
Lipetsk
Bratsk
Angarsk
Minusinsk
Barnaul
Tynda
Severobaikalsk
Mogocha
Skovorodino
Irkutsk
Mysovaya
Kholbon
Magdagachi
Ulan Ude Chita
Svobodny
Rubtsovsk
Orenburg
Biysk
Choya
Gorno-Altaisk
Orsk
Frolovo
Nizhneudinsk
Tulun
Zima
Abakan
Samara
Voronezh
Stary Oskol
Beloretsk
Neryungri
Tayshet
Kemerovo
Novosibirsk
Tatarsk
к
Barabinsk
Karasuk
Novokuznetsk
Magnitogorsk
Saratov
Belgorod
Chelyabinsk
Omsk
Saransk
Tula
Bryansk
Kuranakh
Krasnoyarsk
Kurgan
Naberezhnye Chelny
Cheboksary
Ufa
Ulyanovsk
Arzamas
Ust-Ilimsk
Boguchany
Pazdolinsk
Tomsk
Yekaterinburg
Vladimir
Vyazma
Tobolsk
Knyazhevo
Sayanogorsk
Kyzyl
Gusinoozersk
Petrovsk-Zabaikalsky
Komsomolsk-on-Amur
Belogorsk
Bureya
Blagoveshchensk
Sovetskaya Gavan
Birobidzhan
Khabarovsk
Volgograd
Luchegorsk
Shakhty
Taganrog
Volgograd
Rostov-on-Don
Tikhoretsk
Krasnodar
Ussuriysk
Elista
Astrakhan
To be put into operation in 2009-2010
Stavropol
Artem
Vladivostok
Nakhodka
To be ouy into operation in 2011-2015
Novorossyisk
Yuzhno-Sukhumsk
Sochi
Cherkessk
Wladikawkas
Nazran
Pyatigorsk
Completed construction
Makhachkala
Grozny
Derbent
ters of SO UES. This involved installing 14 small terrestrial satellite communication stations (STSCSs).
As part of rolling out the comprehensive automated
system for security management (CASSM) at Federal
Grid Company’s MES South branch, the Company
installed 29 STSCSs at electric grid units of said
branch. The newly installed STSCSs, including those
installed in accordance with the AMIS EPFA UNEG
program, will enable the Company to ensure the
performance of the CASSM and to set up reserve
channels for dispatch and technological management
and transmission of telemechanics data to dispatch
centers.
Mobile radio network
The mobile radio network is intended for operational
service, emergency repair teams and alternate communication lines.
In 2009 Federal Grid Company continued constructing the TETRA-standard networks in the Moscow
and Nizhny Novgorod Regions, which are scheduled
for completion in 2011. By this time, TETRA-standard
networks will be commissioned in Moscow and the
Moscow region, St. Petersburg, Nizhny Novgorod
and the Nizhny Novgorod region, as well as in the
Chuvash Republic.
Due to extremely high air temperatures, in August
2010, personnel from regular and emergency repair
teams of the MES Center and MES Volga received
additional mobile telecommunications means using
different technologies, including: 95 satellite terminals and 463 GSM terminals with SIM cards from
alternative GSM operators.
Carrier communication system (CCS) along
transmission lines
In 2010 in conjunction with Russian Ministry of Energy and the Ministry of Communications and Mass
Media, Federal Grid Company worked to determine
standard procedures for accounting, distributing and
controlling radio frequency ranges used in carrier
communication systems along transmission lines.
59
2.0
ABOUT THE COMPANY
PRODUCTION OVERVIEW
INVESTMENTS AND INNOVATIONS
ECONOMIC AND FINANCIAL PERFORMANCE
CORPORATE GOVERNANCE
SOCIAL RESPONSIBILITY
Telephone network
The power sector telephone network provides
reliable communication lines for the dispatcher
and the administration of electric energy services.
The network has been built on the hub principle
and ensures communication between the System
Operator and other electricity market subjects.
In 2010 Federal Grid Company launched more than 20
digital private automatic branch exchanges (PABXs) at
its branches’ electric grid units – MES. The Company
also introduced a registration scheme for operating
personnel communications, wireless communication
systems based on the DECT standard and public
address and radio paging systems.
GLONASS-based systems
Federal Grid Company is actively involved in efforts
to adopt GLONASS technologies. In particular, in 2010
the Stavropolsky PMES introduced a pilot zone
for a system to monitor pedestrian staff and
automobiles using the GLONASS/GPS technology
produced by Russian Navigation Technologies.
As part of the program, 12 cars of the line service
teams were equipped with personal trackers. Ten
members of the line service teams received personal
trackers. The Company also introduced five mobile
units ensuring rapid control over vehicles not equipped
with fixed vehicle tracking units.
In 2011 the Company plans to set up a pilot zone at
the Lower Volga PMES. As part of the pilot zones and
based on GLONASS technologies, the Company will
roll out a control and monitoring system for PMES
vehicles, creating a standard geo-locational system
with navigational and informational support to line
service and emergency repair teams and prompt
control, as well as implementing a control and
monitoring system for pedestrian staff at the
Company’s branches. There will also be a system
to monitor and forecast the condition of towers for
overhead transmission lines crossing over water
obstacles and mountainous areas. Performances at
the pilot zones will enable the Company to identify a
list of GLONASS-based services recommended to be
introduced at Federal Grid Company’s branches.
Data on CCSs commissioned in 2010 is provided in the table below:
Federal Grid
Company's branch
MES Center
Total number
of CCSs installed
in 2010
Total number
of CCSs as of
1 January, 2010
Total number
of CCSs
commissioned
in 2010
Total number
of CCSs as
of 1 January,
2011
12
1,168
17
1,184
MES Volga
-
359
-
333
MES South
16
424
11
572
MES Siberia
4
911
6
1,212
MES Urals
-
980
-
1,305
MES West
Siberia
17
299
15
335
MES North West
34
906
59
1,608
-
302
-
806
83
5,349
108
7,355
MES East
Total
60
FEDERAL GRID COMPANY
Enterprise Resource Planning System (ERPS)
The ERPS is an automated business-process and
technological management system. As of the end of
2010, Federal Grid Company has launched commercial
operation of 20 automated business management
system as part of the ERPS project.
Automated Technological Management
System (ATMS)
The ATMS is a single distribution hierarchical system
that integrates the facilities and sub-systems of
existing and independently evolving automatic
and automated management systems. It is based
on the UNEG center for information management
(CIM) and the integrated information exchange model
(IEM), which uses ATMS hardware and soſt ware
package (H&SP).
In 2010 Federal Grid Company began a pilot test
of the H&SP (ADTMS) project at the Grid Control
Center (GCC) of the Kuzbassky PMES, at the 2nd
launch site of the GCC of North West (ADTMS),
H&SP of SCADA for the first stage of MES
Siberia and MES East. As part of the Program
for Reliability and Observability Improvement
(PROI), the Company introduced data acquisition
systems at 26 substations, developed projects
for tele-mechanics and upgraded the data transfer
system at 152 substations, completed tenders and
signed agreements to implement the telemechanics
and data transfer system at 161 substations, and
started developing projects at 172 substations.
ANNUAL REPORT
2010
an AMIS EPFA UNEG at substations with a voltage
of 220 kV and below are in their final stage.
IT Systems Outlook
Developing IT systems, which enables Federal Grid
Company to manage its business more effectively,
is of particular importance to the Company. In 2011
the Company plans to launch R&D efforts to set up
an electricity quality monitoring system in the UNEG.
This will mark the first stage of creating a unified multilevel information monitoring system to measure
electricity quality compliance with existing norms, which
will later ensure a transition to the electricity parameter management system.
An equally important IT area is establishing a comprehensive system for equipment management
at Federal Grid Company. In 2011 the Company
plans to consider principal approaches to building
a comprehensive equipment management system.
Automated Measuring and Information
System for Electric Energy Fiscal
Accounting (AMIS EPFA)
Federal Grid Company’s AMIS EPFA is a multilevel territorial distribution system for data and
measurements with centralized management and a
unified center for collecting, processing, storing and
transferring electricity measurements, as well as a
distribution function for electricity measurements.
The Company reacted and launched an automated
information and measurement system for electric
energy fiscal accounting that covers substations
with voltage of 330 kV and above. Efforts to create
61
2.0
ABOUT THE COMPANY
PRODUCTION OVERVIEW
INVESTMENTS AND INNOVATIONS
ECONOMIC AND FINANCIAL PERFORMANCE
CORPORATE GOVERNANCE
SOCIAL RESPONSIBILITY
2.7 PROCUREMENT
Procurement Management
During the first eight months of 2010 Federal Grid
Company conducted all procurements in accordance
with the Company’s Provision on the Regulated
Procurement of Goods, Products and Services for
Federal Grid Company Needs, as approved by the
Company’s Board of Directors in July 2009. Since
September 2010 all procurement activities have been
carried out in accordance with the Provision approved
by the Company’s Board of Directors in August 2010.
The Provision sets out a uniform procedure for
procuring goods, work and services based on
modern competitive sourcing forms, predominantly
in an open competitive format. The procedure
complies with requirements specified in the
Russian Government’s Regulations No. 1158 dated
13.10.1999 “On the Enforcement of Economically
Sound Principles for Product (Services) Pricing by
Natural Monopolies.”
Import replacement
Import replacement is
an economic strategy
and state industrial
policy aimed at replacing
imports that are in high
demand on the domestic
market with domestically
produced goods. The social
and economic goal of this
strategy is to create jobs
and keep added value in
Russia, as well as to foster
innovation.
The uniform procurement procedure helps ensure
that funds are spent efficiently as intended and to
secure economically sound and competitive prices
from suppliers. This procedure ensured the realization
of the following basic procurement management
principles:
•
•
62
Transparency. Procurement procedure rules
are set out on the corporate web site. Information
about any procedural violations can be sent to
the Company’s Central Tender Committee (CTC),
which includes representatives from the Russian
Ministry of Energy and the Federal Antimonopoly
Service. The annual procurement program is published on the corporate web site and on the TZSElektra electronic trading site. A significant share
of contracts is awarded via open tenders and
other open competition formats. Bids for these
contracts are solicited via the corporate web site,
the electronic trading site and via mass media.
Competition. The procurement system is designed to give a preference to open bidding, ensuring that the best offer wins. Any competitive
process restrictions require serious substantiation and the approval of the Company’s regulatory
bodies. Only the Company’s CTC can make decisions to use only one a single supplier for sourcing.
•
Substantiation. The procurement procedure
rules require every decision to be substantiated
and delivered in writing, which makes the process
more efficient and prevents corruption.
Federal Grid Company’s Central Tender Commission
approved TZS-Elektra, a system designed to set
up and manage competitive and regulated noncompetitive procurement based on Internet technologies, as the electronic trading site (ETS) recommended for use by Federal Grid Company and its SDCs
(Minutes No. 2007/51/5 as of 2 March, 2007).
FEDERAL GRID COMPANY
ANNUAL REPORT
2010
Competitive Procurement
Competitive procurement amount (RUR mln)
% of total procurement
The Annual Comprehensive Procurement Program
(ACPP) is draſted by various departments of the Company’s administrative office and its branches.
•
•
•
In 2010 competitive procurement carried out by the
Company stood at RUR259,302.98 million, which
represents 72.5% of the year’s total procurement.
The Company’s 2011 procurement
tasks include:
•
Cost reduction by saving funds when sourcing
products (goods, work and services);
•
Providing Federal Grid Company and other electric grid companies with products of the required quality at the lowest price possible and
on schedule;
•
Optimizing the procurement management system using best practices;
•
Aligning the Company’s Regulations on Procurement in accordance with the law “On the
Procurement of Goods, Work and Services by
State-Run Corporations (Companies), Natural
Monopolies and Public Utilities Companies,” aſter
it passes Russian State Duma.
Import Replacement Policy
Import replacement is an economic strategy and
state industrial policy aimed at replacing imports that
are in high demand on the domestic market with domestically produced goods. The social and economic
goal of this strategy is to create jobs and keep added
value in Russia, as well as to foster innovation.
•
•
•
•
•
•
2009
2010
234,475.3
49,550.8
259,302.98
90.3
59.6
72.5
Upgrading existing electric grid production
assets;
Instituting innovations in the UNEG;
Improving energy efficiency (including reducing
electricity losses in the Russian UNEG (~5%) to
the level of the UNEG losses typical in developed
economies (~3.7%), which enables potential savings of up to 3 billion kWh per year);
Having strong industrial safety;
Developing production and scientific potential;
Engaging in technological improvement in production;
Improving the payment balance structure;
Optimizing internal demand;
Creating jobs.
Federal Grid Company is developing an Import Replacement Program that aims to boost Russia’s
electric equipment industry and increase the share
of Russian suppliers in the Company’s major investment program. The Program is planned till 2020 and
includes three sub-programs:
•
•
•
The primary principles of Federal Grid Company’s import
replacement policy include:
2008
Short-term (till 2014) will see an increase in
the share of Russian-made equipment in the
Company’s procurement to 40%. The subprogram also relies on making greater use of
Russianmade equipment, which is already
mass-produced and has received industrial
certification. Companies that produce
equipment look to receive expanded services,
including maintenance support for equipment;
I Mid-term (till 2015). In accordance with it the
share of Russian-made equipment purchased by
the Company is to reach 50%. This stage aims
63
2.0
ABOUT THE COMPANY
PRODUCTION OVERVIEW
INVESTMENTS AND INNOVATIONS
ECONOMIC AND FINANCIAL PERFORMANCE
CORPORATE GOVERNANCE
SOCIAL RESPONSIBILITY
•
64
to upgrade equipment properties to world best
levels. One way to achieve this aim is to create
joint or licensed production facilities;
Long-term (till 2020) will see the share of Russian-made equipment increase to at least 60%,
driven by the development and launch of mass
production for innovative equipment previously
not made in Russia, and by exceeding best practice standards.
In 2010 as part of the Import
Replacement Program, the Company signed agreements with
35 Russian power equipment
producers. In value terms, the
share of imported equipment
purchased by the Company
stood at 70%.
Foreign equipment, %
TOTAL
SCADA
Operating DC voltage systems
Emergency control
automatics (ECA)
AMIS EPFA
Telecommunications
Automated system of
technological process
management (ASTPM)
Relay protection and
automatic equipment (RPA)
TOTAL
Circuit breakers
Power cables
110-500-kV gas-insulated
distributor systems (GIDSs)
110-500-kV excess
voltage suppressors
Voltage transformers
Current transformers
Disconnecting switchers
Reactors, thyristor controlled
series capacitors (TCSC)
Transformers
FEDERAL GRID COMPANY
ANNUAL REPORT
2010
Primary equipment:
100
80
60
40
20
0
Russian-made equipment, %
Foreign equipment, %
Secondary equipment:
100
80
60
40
20
0
Russian-made equipment, %
65
MOVING FORWARD
WITH NEW ENERGY
ANNUAL REPORT
2010
INVESTMENTS
AND INNOVATIONS
THINK AHEAD –
ACT NOW
3.0
ABOUT THE COMPANY
PRODUCTION OVERVIEW
INVESTMENTS AND INNOVATIONS
ECONOMIC AND FINANCIAL PERFORMANCE
CORPORATE GOVERNANCE
SOCIAL RESPONSIBILITY
3.1 INVESTMENT
ACTIVITIES
Federal Grid Company’s investment activities are carried out in
accordance with the investment program developed and adopted
according to the requirements of the Russian Government's
Resolution No. 977 “On Investment Programs for Power Sector
Entities” (dated 1 December, 2009) for the five-year period.
Key Objectives and Tasks
of Investment Activities:
•
Ensuring power output for power generating
units of NPPs, HPPs and TPPs put into operation;
•
Ensuring the reliability of the UNEG operation;
•
Removing transmission constraints and creating
possibilities for connecting additional consumer
loads;
•
Maintaining the main electric grids in operating
condition;
•
Realizing agreements concluded with regional
authorities;
•
Creating technological infrastructure objects for
the competitive market functioning of electricity
and capacity;
•
Developing and introducing innovative technologies, materials, construction and power
grid equipment, ensuring a higher quality of the
UNEG operation;
•
Developing a technological management and
communication system, IT technologies for upgrading the quality and operational efficiency of
managing operations and creating conditions for
the gradual transition to the Smart Grid.
•
Electric grid development up to 2016 is aimed at
ensuring the reliable and stable functioning of the
UES of Russia and the competitive WECM , as well as
a reliable power supply for consumers and ensuring
capacity output for power plants.
The new technological platform for the UES of Russia, which is currently being developed – the smart
energy system with active adaptive grid (SES AAG) –
will ensure the leading role of the electric grid in
providing reliable connections for generation and
consumers and increase the quality of services.
Active adaptive grid realization will occur via:
•
•
•
•
The UNEG Development
The UNEG development is one of Federal Grid
Company’s priority tasks. Main directions of the
UNEG development are determined by:
•
The general scheme of power industry object
allocation till 2020 with an outlook till 2030;
68
Scheme and development program for the UES
for the 2010-2016 period.
Systematically installing active technical equipment in the grid, providing an effect during the
development of the energy system as a whole;
Implementing new information technology systems;
Using quick response programs to evaluate condition and management in online and offline
regimes, including with electricity consumption;
Utilizing the adaptive system of centralized and
local management in normal and emergency
modes.
The UNEG Development Trends:
•
The development of 750-kV grids is foreseen in the
European part of the UES of Russia;
FEDERAL GRID COMPANY
•
•
500-kV electricity transmission lines will be developed for capacity output at large power plants,
including nuclear ones and strengthening the main
grid in energy zones of the Center, South and midVolga Regions, as well as in the Urals, Siberia and
the East, as well as for the development of intersystem communication;
330-kV grid will continue to perform system-forming functions and ensure capacity output at large
stations in the Western part of the Center energy
zone, as well as in energy zones of the North-West
and the South;
ANNUAL REPORT
2010
•
Main trends in 220-kV grid development will include
strengthening distribution functions and ensuring
power plants’ capacity output. 220-kV grids in the
energy systems of Eastern Siberia, as well as in
the energy systems of Arkhangelsk and Komi, will
be system forming.
The principal forecast indicators for commissioning electric grid facilities based on the
Scheme and program for developing the UES of Russia for the 2010-2016 period, in the
context of the Interconnected Energy Systems (IES) and the UES of Russia
IES of the East
km
MVA
220 kV
7,747.1
4,814
MVAR
200
500 kV
1,097.3
668
900
IES of Siberia
220 kV
2,626.5
9,787
3,784
500 kV
2,401.9
11,387
4,560
220 kV
1,576.8
1,266
—
330 kV
2,367.2
7,380
180
750 kV
558.0
3,000
1,320
220 kV
1,394.5
1,425
—
500 kV
1,945.6
5,959
2,160
220 kV
1,090.2
7,490
488
330 kV
939.0
2,132
384
500 kV
2,480.6
5,076
2,520
IES of the North-West
IES of the mid-Volga
IES of the South
IES of the Urals
220 kV
5,264.0
9,584
—
500 kV
1,522.0
10,277
1,130
220 kV
1,660.9
32,751
—
330 kV
—
600
—
500 kV
896.8
16,012
540
750 kV
285.0
3,753
660
Total, including
35,883.4
133,361
18,826
220 kV
21,360.0
67,117
4,472
330 kV
3,306.2
10,112
564
500 kV
10,344.2
49,379
11,810
750 kV
873.0
6,753
1,980
IES of the Center
69
3.0
ABOUT THE COMPANY
PRODUCTION OVERVIEW
INVESTMENTS AND INNOVATIONS
ECONOMIC AND FINANCIAL PERFORMANCE
CORPORATE GOVERNANCE
SOCIAL RESPONSIBILITY
The 2008-2010 Volume of Planned
and Actual Capital Investment Financing
200,000
177,478
170,505 167,031
150,000
121,746
100,000
124,000
Siberia Region:
Power supply reliability for industrial enterprises,
including the Sayansky Aluminium Smelter and the
Khakassky Aluminium Smelter, as well as for other
electricity consumers in Sayanogorsk, the southern
regions of Buryatia and North-West Mongolia, significantly increased aſter the following corporate objects
were put into operation:
106,044
•
50,000
•
0
2008
2009
2010
•
Planned, RUR mln
Installation of the capacitor bank at the 500-kV
Oznachennoye substation with introduced capacity of 2x104 MVAR;
Installation of the capacitor bank at the 500-kV
Aluminiyevaya substation with introduced
capacity of 3х104 MVAR;
The 220-kV Selenduma substation. Installed reactive
power compensation means (RPCM) 2х20 MVAR.
Actual, RUR mln
2010 Investment
In 2010 the actual volume of investment performed
by the Company totaled RUR 167,031 million.
In 2010 the Company activated production capacities
at 52 objects.
Urals Region:
To ensure the capacity output schemes of the
Chelyabinskaya TPP-3 and the Sredneuralskaya
GRES, the Company put the following objects into
operation:
•
Key Objects Launched in 2010:
East Region:
Within the Federal Target Program for Economic
and Social Development of the Russian Far East and
Trans-Baikal up to 2013 the following facilities were
launched:
•
•
•
Neryungrinskaya GRES – Nizhniy Kuranakh
220-kV high voltage line with a length of 275 km;
Artemovskaya TPP – Vladivostok 220-kV high
voltage line with a length of 2х20 km;
220-kV Aeroport substation with 220-kV high
voltage approach lines with a transformer capacity
of 2х25 MVA, approach line length is 2х11 km;
Introducing these objects upgraded the reliability of
power supply to consumers in the South Yakutia and
Primorsk Regions, including Yakutia’s large gold mines
and the oil pumping station of the ESPO pipeline
system, as well as providing energy to APEC summit
objects.
70
•
Double circuit 220-kV TPP-3 – Novometallurgicheskaya high voltage line and reconstruction of the 220-kV Novometallurgicheskaya –
Kozyrevo high voltage line with launching
under voltage of 6.4 kilometers;
Reconstructed 220-kV Sredneuralskaya TPP –
Peschanaya 1 high voltage line and 220-kV
Sredneuralskaya GRES – Peschanaya 1 high voltage line and 220-kV Srendeuralskaya GRES –
Kalininskaya high voltage line with launching
under voltage of 20 kilometers.
Volga Region:
Introducing the 500/220/35-kV Krasnoarmeyskaya
substation with 500, 220-kV high voltage line approaches ensured upgraded power supply reliability
for consumers in the Samara Generation System,
provided opportunities to connect new consumers
in the Novokuibishevsky and Chapaevsky Districts
of the Samara Region and lessened the load of the
500-kV Kuibishevskaya substation.
South Region:
In 2010 the Company completed construction of the
110-kV Laura and Rosa Khutor substations, 110-kV
FEDERAL GRID COMPANY
substations in the Krasnopoliansky Village District,
10-kV substations and distribution lines for the Rosa
Khutor ski resort in the Sochi Region. New objects
will supply power to numerous Olympic objects under
construction in Krasnaya Polyana – the ski complex,
freestyle center, mountain liſts, the Psehako mountain tourism center and telecommunication and engineering infrastructure objects designed to service
the 2014 Winter Olympics.
For the capacity output of the second power generation unit of the Volgodonskaya NPP (launched 17
March, 2010) were built and put into operation the
500-kV Nevinnomyssk substation with a capacity
of 1002 MVA and the 500-kV Volgodonskaya NPP –
Nevinnomyssk transmission line with a length of 440
kilometers. New energy objects will allow for the
distribution of new capacity of the Volgodonskaya
NPP to the energy systems of Districts of the North
Caucasus Federal Region.
North-West Region:
In 2010 the Company put into operation the
220-kV Prospekt Ispytatelei substation, which will
liquidate the acute energy deficit in the Primorsky
and Vyborgsky districts of St. Petersburg and will
In 2010 the actual volume
of investment performed
by the Company totaled
RUR 167,031 million.
ANNUAL REPORT
2010
decrease the load on the 220-kV Primorskaya and Poluprovodniki substations. The Company also launched
the new 330-kV Tsentralnaya substation in St. Petersburg, which will become the main power feed center
for new 110-kV energy objects. Commissioning this
object successfully resolved the energy deficit in
the historic part of St. Petersburg – the Central and
Admiralteisky Districts.
Central Region:
The Company concluded reconstruction work at
the 500-kV Lipetskaya substation with the goal of
upgrading the reliability of power supply to Lipetsk Region consumers. In addition to this, within
the broadening of the 500-kV Nizhegorodskaya
substation, the Company put into operation a
second autoconnected transformer with a capacity
of 501 MVA, which increased the substation capacity
to 1,002 MVA, thus increasing power supply reliability
for consumers in Nizhny Novgorod. This also allowed
for the connection of new consumers in the region
to electric grids.
Western Siberia Region:
•
Within the framework of the agreement on the
technological connection of Rosneſt Oil Company
objects, the Company concluded construction
and put under operating voltage lines of approach for the 220-kV Magistralnaya – YuzhnoBalykskaya GPKh high voltage line to the 220-kV
Sredny Balyk substation located in the Tyumen
Region;
•
Within the framework of fulfilling the program to
decrease electricity losses, the Company put into
operation the operative 500-kV shunt reactor at
the 500-kV Nelym substation. The reactor with
a capacity of 180 MVAR regulates voltage levels
of the 500-kV grid in the southern part of the
Tyumen Energy System;
•
In the Tyumen Region, the Company put into
operation the 220-kV Tobolskaya TPP – Irtysh
transmission line to ensure capacity output of
the Tobolskaya NPP in a volume of 110 mW into
the Tyumen Energy System;
•
As part of the construction of the 220-kV Demyanskaya – Snezhnaya transmission line was
put into operation an autoconnected transformer
with a 125 MVA capacity at the 220-kV Snezhnaya substation.
71
VOLUMES OF NEW CAPACITY
INTRODUCTION DURING
2010-2014
4
2
220-500 KV SUBSTATIONS
WITH CAPACITY OF OVER 89,000 MVA
6
3
5
1
220-750 KV TRANSMISSION LINES,
WITH LENGTH OF OVER 21,000 KM
7
1. MES SOUTH
2. MES CENTER
3. MES VOLGA
4. MES NORTH-WEST
5. MES URAL
-
Substation 500 kV  6
Substation 330 kV  5
Substation 220 kV  8
TL 500 kV  12 (2 396 km)
TL 330 kV  5 (696 km)
TL 220 kV  10 (699 km)
Substation 500 kV  2
Substation 220 kV  2
TL 750 kV  1 (285 km)
TL 500 kV  7 (1 130 km)
TL 220 kV  16 (609 km)
Substation 500 kV  1
TL 500 kV  2 (546 km)
TL 220 kV  1 (129 km)
Substation 330 kV  11
Substation 220 kV  1
TL 330 kV  8 (909 km)
TL 220 kV  1 (253 km)
Substation 220

TL 500 kV  4 (1
TL 220 kV  9 (6k
k
RUR70.5 bln
72
RUR70.4 bln
RUR13.6 bln
RUR42.8 bln
RUR32.8 b
FEDERAL GRID COMPANY
ANNUAL REPORT
2010
8
7
-WEST
5. MES URALS
6. MES WEST SIBERIA
7. MES SIBERIA
8. MES EAST
 11
1
km)
km)
Substation 220 kV  1
TL 500 kV  4 (1,021 km)
TL 220 kV  9 (651 km)
Substation 220 kV  7
TL 500 kV  2 (298 km)
TL 220 kV  14 (1,881 km)
Substation 500 kV  3
Substation 220 kV  8
TL 500 kV  6 (1,726 km)
TL 220 kV  8 (1,956 km)
Substation 500 kV  1
Substation 220 kV  18
TL 500 kV  2 (946 km)
TL 220 kV  15 (3,446 km)
RUR32.8 bln
RUR36.4 bln
RUR75.4 bln
RUR93.1 bln
73
3.0
ABOUT THE COMPANY
PRODUCTION OVERVIEW
INVESTMENTS AND INNOVATIONS
ECONOMIC AND FINANCIAL PERFORMANCE
CORPORATE GOVERNANCE
SOCIAL RESPONSIBILITY
Federal Grid Company’s 2010-2014 Investment
Program
The basic principles of investment planning activities
are forming a five-year development program for the
Company, with subsequent annual corrections with
a one-year shiſt in the planning horizon. Corrections
are performed taking into account actual financing
and the utilization of capital investment for realized
projects and adjusting the UNEG development
scheme.
On 12 November, 2010, our investment program
received a final approval from the Russian Ministry of
Energy. The Company transitioned from a three-year
to five-year investment program, which is the result of
a five-year tariff period for electricity transmission.
The Company’s investment program is aimed
at developing the UNEG and ensuring its stable
operation, as well as upgrading the quality of power
supply to consumers.
Investment Program Implementation
Indicator
Characteristics
Result
Developing the electric
capacity market and ensuring
competition
Merger of free
power transfer zones
Withdrawing transmission
constraints between
29 established free power
ransfer zones (Construction
of 25 electric grid objects)
Ensuring capacity
output for power plants
Ensuring capacity output
in the amount of 32 GW
for generating capacities
of 37 power plants
(Construction of 5,440
kilometers of transmission
lines and substations with
a capacity of 9,936 MVA)
Providing technological
connection opportunities
to consumers
Withdrawing
transmission constraints
Two-fold decrease in “closed
power supply centers”
(from 251 to 127)
Energy efficiency
Decreasing
energy losses
A relative decrease in energy
losses (from 4.89% as
of the end of 2009 to 4.79%
as of end of 2010)
Reliability
Increasing the
reliability of power supply
to consumers
The actual amount
of consumer constraints
relative to power supply
from the grid in 2010
totaled 0.0013%
For 2010-2014 financing the investment program will total more than RUR952 billion. According
to corporate estimates, as a result of this realization, the Company will construct 21,078
kilometers of electricity transmission lines and will put into operation 89,180 MVA of transformer
capacity.
74
FEDERAL GRID COMPANY
ANNUAL REPORT
2010
Plan to Launch Electric Grid Capacities in 2010-2014
30,000
26,557
22,474
19,000
20,000
11,922
10,000
8,102
5,893
5,435
3,520
2,758
2,936
0
2010
Year
2011
2012
2013
2014
Transmission lines, km
Transmission capacity, MVA
Investment Program Structure
RUR bln
Development of backbone grids,
not included in agreements with
regions 5,366.6 km; 10,890 MVA
90.37 (9.5%)
212.77 (22.3%)
Increase in reliability of power
supply of Moscow, St. Petersburg
and Tyumen 980.1 km; 17,531 MVA
127.4 (13.4%)
State programs (ESPO, Far East
and Trans-Baikal, Sochi, APEC)
4808.4 km; 4181.3 MVA
28.41 (3%)
137.93 (14.5%)
216.262 (22.7%)
58.71
14.7
65.8 (6.2%)
(1.5%)
(6.9%)
952,4
952.4
Capacity output of NPPs, HPPs,
TPPs over 32 GW 5,180.4 km;
10,936 MVA
Agreements with regional administrations
(except Moscow, St. Petersburg
and Tyumen) 3663.3 km; 5,199 MVA
Innovations, energy efficiency, development
of technological management
Technological connection
33 km 2577 MVA
RURRUR,
blnbln 2010-2014 investment program
Fixed asset renewal
10,468 km; 37,866 MVA
2010-2014 Investment program
Others
75
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ABOUT THE COMPANY
PRODUCTION OVERVIEW
INVESTMENTS AND INNOVATIONS
ECONOMIC AND FINANCIAL PERFORMANCE
CORPORATE GOVERNANCE
SOCIAL RESPONSIBILITY
Investment Volume and Directions:
RUR bln
200
0
5.2
4.2
62.2
69.7
122.1
120.7
1.8
3.5
150
65.5
59.1
130.5
140.8
57.1
100
50
109.9
0
2010
2011
2012
2013
2014
Technological connection, RUR bln
Support of assets, RUR bln
Development of assets, RUR bln
The investment program will be financed out of the
Company’s own funds, federal budget funds (including
funds directed at the Federal Target Program for
Economic and Social Development of the Russian Far
East and Trans-Baikal up to 2013 and the Program
for Electric Grid Development in the Sochi Region),
as well as out of borrowed funds.
76
The Company plans to invest RUR624.1 billion or
65.5% of the total fi nancing sum in developing
corporate assets; the Company intends to direct
RUR313.6 billion or 32.9% of the total investment
volume at maintaining assets; the volume of financing
for technological connections will be RUR14.7 billion
or 1.6 of the total investment sum.
FEDERAL GRID COMPANY
ANNUAL REPORT
2010
2010 Investment
Program Fulfillment
2010 Structure of Actual Investments Fulfillment
1% 1% 1%
13%
7,50%
4,50%
22,20%
4,10%
9,70% 21%
30%
14,60%
19,50%
5%
17,90%
4%
10%
14%
Capacity output objects
Programs for Moscow, St. Petersburg
and Western Siberia
Objects of agreements with administrations
Grid development (except agreements)
Far East Federal Target Program
Sochi Federal Target Program
Fixed assets renewal
Acquired facilities
Other
Technological connection
Financing Sources for the 2010
Investment Program, RUR mln
1,864
43,000
22,20%
7,50%
4,50%
48,833
4,10%
9,70%
14,60%
19,50%
25,951
16,611
17,90%
3,401
27,321
Payment for tehnological connecction
Tariff sources total
(amortization (32,268) + profit (16,615)
VAT
Funds of RAO UES of Russia
Additional share issue
Opening balance
Borrowed funds
77
3.0
ABOUT THE COMPANY
PRODUCTION OVERVIEW
INVESTMENTS AND INNOVATIONS
ECONOMIC AND FINANCIAL PERFORMANCE
CORPORATE GOVERNANCE
SOCIAL RESPONSIBILITY
3.2 KEY INVESTMENT
PROJECTS
1. Sochi 2014
Federal Grid Company participates in constructing,
modernizing and reconstructing electric grid objects
in the Krasnodar Region to ensure the reliable power
supply of the Sochi 2014 Winter Olympics facilities.
Till 2014 the Company within its own investment
program and the Federal Target Program for
Developing Sochi as a Mountain Climate Resort
(2006-2014), adopted by the Russian Government,
will construct, modernize and reconstruct 21 objects
(with a total capacity of 1,774 MVA and line length
of 200 km) of the backbone electric grid complex in
the Sochi Region.
In 2010 the Company concluded the first stage of
constructing the 10-kV transformer and distribution
substations in the Sochi Region. As part of work
in the Rosa Khutor mountain cluster, the Company
constructed 16 10-kV transformer substations and
two 10-kV distribution substations representing
closed objects, which fully excludes the impact of
equipment on the unique nature of the Sochi National
Park. The Company also constructed new 100-kV
Laura – Rosa Khutor and Poselkovaya – Rosa Khutor
cable transmission lines designed to supply power to
the Olympic objects. The first stage of reconstruction
of the 220-kV Dagomys substation was wrapped up,
as a result of which substation capacity increased by
70%. The Company also concluded the first stage
of reconstructing the 220-kV Psou substation and
capacity increased from 125 MVA to 400 MVA.
2010-2014 Financing Volume for Sochi
Olympic Facilities in Sochi, RUR mln
6,457.2 (31%)
2,182.4 (11%)
12,138 (58%)
2010
2011
2012
20,777.6
RUR mln
Within the Company’s investment program,
total financing for Sochi Olympic objects will
stand at RUR 20,777.6 million.
78
FEDERAL GRID COMPANY
ANNUAL REPORT
2010
2. APEC Summit
As part of the Federal Target Program for Economic
and Social Development of the Russian Far East and
Trans-Baikal up to 2013 adopted by the Resolution
of the Russian Government, Federal Grid Company
constructs and reconstructs backbone energy objects
in the Primorsk Region to insure the uninterrupted
power supply for objects for the summit of Asian
Pacific Economic Cooperation (APEC), which will
take place in Vladivostok in 2012. To achieve these
goals, during the 2010-2012 period, the Company will
construct eight backbone electric grid objects:
1.
2.
3.
4.
5.
6.
7.
8.
220-kV Zeleny Ugol substation with 220-kV electric
transmission line approaches
220-kV Vladivostok - Zeleny Ugol high voltage line
(220-kV section Artemovskaya TPP – Zeleny Ugol)
220-kV Vladivostokskaya TPP-2 – Zeleny Ugol –
Volna transmission line
220-kV Artemovskaya TPP – Vladivostok high
voltage line
220-kV Russkaya (Pospelovo) substation
220-kV Zeleny Ugol – Russkaya (Pospelovo)
transmission line with a crossing over the East
Bosporus Channel
220-kV Patroclus substation with high voltage line
approaches
220-kV Aeroport substation with 220-kV electric
transmission line approaches
9,025.9
2010-2014 Financing for Federal
Target Program Objects, RUR mln
8,591.2 (12%)
8,190.4 (12%)
12,140.6 (17%)
26,319.5 (37%)
15,150 (22%)
2010
2011
2012
2013
2014
RUR mln
For the 2010-2014 period the total volume
of the Company investment program financing
for the Federal Target Program Objects will
stand at RUR70,391.7 million, including
RUR9,025.9 million for APEC Summit objects.
79
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ABOUT THE COMPANY
PRODUCTION OVERVIEW
INVESTMENTS AND INNOVATIONS
ECONOMIC AND FINANCIAL PERFORMANCE
CORPORATE GOVERNANCE
SOCIAL RESPONSIBILITY
3. ESPO
The construction of the Eastern Siberia –
Pacific Ocean (ESPO) oil transport pipeline
is the largest project in the last several decades to be realized by Transneſt Company for
transporting Russian oil to promising Asian
and Pacific markets.
Within the framework of technological connection
agreements and its own investment program, Federal
Grid Company constructs and reconstructs backbone
energy objects for connection to the electric grids of
ESPO pipeline objects on the territory of the Republic
of Sakha (Yakutia), the Jewish Autonomous Region
and the Amur, Khabarovsk and Primorsk Regions. In
2009-2012, for these purposes, Federal Grid Company
will construct and reconstruct 24 backbone electric
grid objects.
All aspects of constructing the ESPO energy
object are under the special control of the Russian
Ministry of Energy. When forming the 2011 federal
budget and for the planned 2012-2013 period, the
Russian Government will consider the opportunity of
increasing financing for the Federal Target Program
for 2010-2014 Financing for Federal Target Program
Objects, RUR mln Economic and Social Development
of the Russian Far East and Trans-Baikal up to 2013
in the part of constructing the objects of ESPO-1 and
expanding and constructing ESPO-2.
On 22 March, 2010, Federal Grid Company and
Transneft Company concluded an agreement
on coordinating the main principles and forms of
mutual relationships between parties during the
organization of financing, projecting, constructing
and reconstructing objects of the external power
supply with the aim of ensuring the timely connection
of grid infrastructure objects to power receiver
devices of Transneſt Company. This ensures their
stable functioning.
On 27 August, 2010, Federal Grid Company, RusHydro
and Transneſt signed a cooperation agreement,
according to which the Company will construct energy
grid objects for the capacity output of the Niznhe-
80
Bureyskaya HPP and by the end of 2012, objects of
the external power supply of ESPO-2 will be put into
operation.
In 2010 the Company completed capital repair of the
220/110/35/6-kV auto-connected transformer with
a capacity of 125 MVA at the reconstructed 220-kV
Shirokaya substation in the Primorsk Region and put
into operation the second 220-kV Neryungrinskaya
GRES – Nizhniy Kuranakh transmission line in Yakutia.
This increased the reliability of power supply for
consumers in these regions and created conditions
for connecting new consumers to the backbone grids,
including objects of the ESPO oil pipeline system.
Financing for ESPO Power Supply Objects
in Federal Grid Company's
2010-2014 Investment Program
RUR mln
1,086.8
6,464.9
15,566
13,086.9
2010
2011
2012
2013
FEDERAL GRID COMPANY
ANNUAL REPORT
2010
4. Kalininskaya NPP
5. Boguchanskaya HPP
The Company actively takes part in resolving
the energy deficit problem in the North-West of
Moscow Region by constructing a 750-kV electric
transmission line for capacity output of the fourth
power generation unit of the Kalininskaya NPP
to the Moscow Energy System with the creation
of next generation 750-kV Gribovo and 500-kV
Dorokhovo substations. In 2010-2012, the Company
will construct 742 kilometers of transmission lines
and put into operation 6,658 MVA of transformer
capacity. Total investment in this project will exceed
RUR38.3 billion.
The Boguchanskaya HPP is the largest object under construction in the Russian hydropower sphere with a capacity of 3 thousand
MW, and is part of the Angarsk Cascade of
HPPs. Utilization of the first hydropower units
at the Boguchanskaya HPP is scheduled for
April 2012.
The realization of the Company’s investment project
will create a reliable electrical energy base for
economic development of the Moscow Region, will
remove constraints on new user connections and will
significantly upgrade the reliability and stability of the
Central Region’s Power Supply System.
Ensuring stable power supply for Siberian
consumers during rehabilitation of the
Sayano-Shushenskaya HPP is one of Federal
Grid Company’s priority tasks. To achieve
capacity output of the Boguchanskaya HPP, the
Company conducts large scale work on constructing
220-kV facilities in the Krasnoyarsk Region and also
acts as a technical agent during 500-kV facility
construction.
Objects constructed from the Company investment program funds
Object
Full object cost based on the 2010-2014
investment plan, RUR mln
220-kV Boguchanskaya HPP –
Priangarskaya substation high voltage line
220-kV Priangarskaya substation
220-kV Priangarskaya substation –
Razdolinskaya substation high voltage line
220-kV Razdolinskaya substation
220-kV secondary distribution switchgear
of the Boguchanskaya HPP
Reconstruction of the 220/110/10-kV main
step-down substation (Kodinskaya GPP-220)
Construction of 500-kV Boguchanskaya
HPP – Ozernaya high voltage line
8,818.6
985.0
1,708.6
10,000.0
81
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ABOUT THE COMPANY
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ECONOMIC AND FINANCIAL PERFORMANCE
CORPORATE GOVERNANCE
SOCIAL RESPONSIBILITY
In 2010, as part of its investment program, the Company launched under voltage two circuit 220-kV high
voltage line Priangarskaya substation – Razdolinskaya
substation that crosses the Angara River, two circuit
220-kV Boguchanskaya HPP – Priangarskaya substation high voltage line, put the 220-kV Priangarskaya
substation into operation and expanded and reconstructed the 220-kV Razdolinskaya substation.
6. Skolkovo
Skolkovo Innovation Center is a large scale
project to create the fi rst Russian ultramodern scientific and technological complex
focused on developing and commercializing
new technologies.
In the 2011-2012 period, Federal Grid Company, in
the process of fulfilling the Russian government's
resolution and within the framework of its own
investment program, will reconstruct seven
110-500-kV transmission lines and will construct
two 220-kV substations, Skolkovo and Smirnovo,
with a total capacity of 252 MVA. These substations
aimed at power supply for the innovation center
will become the Company’s first power facilities to
be fully constructed underground. Within Federal
Grid Company's 2010-2014 investment program,
the total sum for financing power facility objects
constructed for the Skolkovo Innovation Center will
stand at RUR17.7 billion.
7. Creating a Ringed Electric Grid
Configuration for Reliable Power Supply
for St. Petersburg and the North-West
Part of the Leningrad Region
Transitioning to 330 kV voltage for the VolkhovSevernaya and Zavod Ilyich substations, with the
newly constructed 330-kV Vostochnaya – VolkhovSevernaya – Zavod Ilyich cable lines, as well as
construction of the 330-kV Vasileostrovskaya
substation with 330-kV Vasileostrovskaya –
Severnaya and Vasileostrovskaya – Zavod Ilyich cable
lines, form an electric energy ring for St. Petersburg.
In addition to the above-mentioned substations, the
reconstructed 330-kV Vostochnaya and Severnaya
substations, as well as the new 330-kV Parnas
82
substation, will be included. Work on the project
has been conducted since 2008 and is scheduled
to be completed in 2012.
In addition, the Company plans to construct a 330-kV
Leningrad NPP-2 – Vyborg overhead cable direct
current line; commissioning this is scheduled for 2014.
Transmitting direct current will ensure the capacity
output of the Leningrad NPP-2 in the direction
of the Vyborg District, lessening the load on the
St. Petersburg electric grids, including the 330-kV
Vostochnaya substation from the transit flow of
capacity toward the Vyborg Region and decreasing
electric grid losses. Taking into account the
construction of an electric connection between the
Leningrad NPP and the Leningrad NPP-2, the high
voltage Leningrad NPP-2 – Vyborg cable line will close
the Big Ring, which consists of electric transmission
lines connecting the Leningrad NPP, the Leningrad
NPP-2, the 750-kV Leningrad substation and the
330-kV Vostochnaya and Vyborg substations.
8. Novovoronezhskaya NPP-2
Further development of the Novovoronezhskaya
NPP (NVNPP) is associated with the construction
of two new power generation units and modern
energy facilities, corresponding with international
safety requirements. The Company plans to put into
commercial operation power generation unit No.1 of
the NVNPP-2 in 2013. Within its investment program,
Federal Grid Company works to construct facilities
of the capacity output scheme for the first power
generation unit of the NVNPP-2, including rearranging
220-500-kV transmission lines.
9. Line construction – Zeyskaya HPP –
Russia-China border
In 2010 Federal Grid Company and the government of
the Amur Region signed an agreement to cooperate
on constructing the 500-kV Amurskaya – the State
border trans-national line, which will be a key to
implementing the project to export electricity from
Russia to China. To increase the capacity output of
the Zeyskaya HPP, Federal Grid Company will also
construct a second 500-kV transmission line Zeyskaya
HPP – Amurskaya. In addition to the possibility of
FEDERAL GRID COMPANY
ANNUAL REPORT
2010
A number of the Company pilot
projects will be implemented at new
objects. As a result, the Company
foresees the introduction and
development of Digital Substation
elements, including using the
optical instrument transformer.
expanding electricity exports to China, the high
voltage line will ensure the capacity output of the
Zeyskaya HPP and will increase the transfer capacity
of the grid in the eastern direction – upgrading the
reliability of the power supply to consumers in the
Amur Energy System. The overall length of the 500-kV
Zeyskaya HPP – Amurskaya – the State border high
voltage line will be 510.6 kilometers.
10. Power supply for
the Elginskoye Deposit
The Elginskoye Coal Deposit is Russia’s largest mineral coal deposit. It is located in the south-eastern part
of Yakutia (415 kilometers to the east of Neryungri
and 300 km from the Baikal Amur mainline). Balance
(proved) coal reserves stand at 2.7 billion tons.
In 2011, the Company will begin constructing
electric grid objects for external power supply to
the complex, which will be completed in two stages.
Within the first stage, by 2012 in the Amur Region, the
Company will reconstruct the 220-kV Prizeyskaya
substation, will construct three new 220-kV
substations and the 220-kV Prizeyskaya – Elgaugol
transmission line with a length of 270 km, including
a special crossing over the Zeyskoye Reservoir. In
2013, work will be completed on expanding the
220-kV distributing device at the Prizeyskaya
substation. A second 220-kV Prizeyskaya – Elgaugol
electric transmission line will be constructed,
and a second auto-connected transformer with
a capacity of 125 MVA will be installed at the
220-kV Elgaugol substation. An additional part of
the project will be reconstructing the operating
220-kV Prizeyskaya substation. A number of the
Company pilot projects will be implemented at
new objects. As a result, the Company foresees the
introduction and development of Digital Substation
elements, including using the optical instrument
transformer. The Company also plans to implement
“smart sphere” technology, which will allow it to
control the main parameters of electricity transit
in real time.
83
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ABOUT THE COMPANY
PRODUCTION OVERVIEW
INVESTMENTS AND INNOVATIONS
ECONOMIC AND FINANCIAL PERFORMANCE
CORPORATE GOVERNANCE
SOCIAL RESPONSIBILITY
3.3 INNOVATIVE
DEVELOPMENT
As the infrastructural foundation of the Russian power sector,
Federal Grid Company understands the importance of innovative
development in the industry aimed at improving the manageability,
reliability, efficiency and safety of power industry object functioning.
Aspiring to technological leadership in the industry, the Company
utilizes the newest technologies, materials and equipment,
incorporating advanced experience from international companies,
enhancing control and monitoring systems, as well as increasing the
educational level and qualifications of our specialists.
The Company’s Innovative Development
and Modernization Policy
In 2010 the Company developed its Innovative Development and Modernization Policy. The Policy adopted
by the Company is aimed at ensuring reliability, energy safety and stable increases in the effectiveness
of using the Russian energy potential, as well as
full-scale integration into the global energy market,
strengthening corporate positions and obtaining the
maximum benefit for the Russian economy by creating an active adaptive grid as the basis of Russia’s
smart electric energy system.
•
•
The Company’s innovative development policy is realized via a complex list of instruments:
1.
The Company’s main directions of innovative
development include:
•
•
•
•
84
Developing and utilizing new types of power
equipment;
Introducing new means of relay protection and
emergency control automatics, equipment diagnostics and energy resource accountability on a
micro-processing basis;
Introducing the newest monitoring systems, managing grid modes and equipment;
Creating systems and equipment that protect
the grids from the impact of external weather
conditions;
Introducing equipment and systems with high
power efficiency characteristics;
Consolidating the domestic scientific base by integrating educational, as well as scientific and
research organizations, in the innovative process.
2.
Of a scientific nature (including the effective usage
of the applicable scientific base, interacting with
educational institutions, using research and fundamental science, studying international experiences
and organizing conferences, seminars and career
enhancement courses that touch upon the Company’s innovative activity);
Normative and legal regulations on the state and
corporate levels (including laws, standards, instructions, regulations, rules and technical policy), as well
as with production and organizational methods.
Based on the Innovative Development and Modernization Policy, the Company developed the Concept
FEDERAL GRID COMPANY
(main provisions) for the innovative development
program, which was adopted in 2010 by the Board
of Directors. The documents evaluate the technological level and development prospects of the
power industry considering corporate scenarios of
innovative development. On the basis of the Concept, the Company has formed an Innovative Development Program with a planning horizon till 2020.
The principal goal of the Company’s Innovative Development Program is to upgrade the reliability, quality
and efficiency of consumer power supply by modernizing the electric grids of the UES of Russia based on
innovative technologies with their transformation into
an active adaptive (smart) center of technological infrastructure for the power industry. Priority tasks for
the Innovative Development Program include forming a target vision for the smart energy system and
preparing and realizing the complex pilot project of
creating a smart grid – energy clusters in the IES of
the North-West and the IES of the East.
In addition, one of the Program’s main directions will
be the development, testing and introduction at the
UNEG objects of “breakthrough” and “ameliorative”
innovative technologies. These include technologies
for accumulating electric energy, technologies for
“high-temperature superconductivity” and technologies for direct current electric transmission, among
others.
An important part of the Program will be developing a
system for Federal Grid Company’s innovative activity,
in particular broadening the Company’s Russian scientific and engineering base, including via attracting
foreign partners and cooperating with Russian higher
educational institutions. The expected effects from
realizing the Program will be a decrease in electricity
transmission losses (with an accompanying ecological
effect – a decrease in the volume of burnt fuel and
СО2 atmospheric emissions), increasing the carrying
capacity of overhead transmission lines (also resolving the tasks of power plants’ capacity output and
ensuring full scale electricity transmission), decreasing growth in the installed capacity of power plants
(by cutting the needed capacity reserve), increasing
the reliability of power supply to consumers, flattening the load curve through the usage of high capac-
ANNUAL REPORT
2010
ity electricity storage, based on various principles
(superconductivity, inductive energy storage and high
capacity electric batteries), decreasing the space occupied by electric grid objects (the compact design of
power plants and overhead transmission lines due to
using new innovative materials and technologies).
Federal Grid Company’s Innovative Development
Program will increase the effectiveness of utilizing Russia’s energy potential, ensuring the
full-fledged integration of the UES of Russia
into the world energy market, contributing to
the development of innovative new technologies, including mastering the mass production
of new devices and materials, ensuring the development of the country’s industry, related
branches and the introduction of new technical
devices with qualitatively new characteristics,
decreasing the share of imported equipment
and creating conditions that will lead to the
maximum benefit for the Russian economy.
Coordinative Scientific and Technical Board
The Company carefully studies innovative solutions,
which can be introduced into the UNEG in the future.
To govern the innovative, technical and exploitation
policy, coordinate work on developing and organizing
modern equipment and technology for new construction projects and to reconstruct and technically
rehabilitate various corporate objects, the Company
has a Coordinative Scientific and Technical Board
(CSTB). The Board comprises the leading specialists
from scientific research and project institutes of the
Russian Academy of Sciences (RAS), directors of the
executive bodies, branches and subsidiaries of the
Company, representatives of the System Operator,
MRSK Holding and domestic producers of electric
energy equipment.
The Board’s main functions include considering and
evaluating prospective directions and programs for
corporate innovation, progressive solutions for technical rehabilitation, reconstruction and new construction of the UNEG objects, the efficiency of conducted fundamental scientific research, exploratory
and applied work, suggestions for using scientific
and technical achievements, as well as advanced
experience for foreign countries and suggestions
85
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SOCIAL RESPONSIBILITY
2009-2014 Financing of the Company’s R&D and Pilot Projects
RUR bln
5.0
0.388
Year
2009
2010
2011
To organize the effective usage of corporate resources for ensuring stable and intensive innovative
development of the UNEG, to form the Program
of scientific and technical, design and experimental and technological work (R&D) and to effectively
implement R&D results in the Company’s production
activity, the Innovation Committee was created by
an Order.
Primary Objectives for the Innovation Committee:
•
•
•
•
•
Considering and approving the Company’s
innovative development policy and program;
Coordinating the main R&D directions for
the approval of the Company’s Scientific and
Technical Coordination Council;
Determining priority R&D projects;
Considering and adopting the R&D Program;
Elaborating on suggestions for competent
contractors (organizations) to fulfill R&D work;
Considering results on fulfilled R&D work;
Elaborating on recommendations for the rational
usage and introduction of pilot projects for the
UNEG and the UES objects;
Assessing modern innovative technologies
to implement at the UNEG objects.
As of now, the financing source for the Company’s
innovative activity is the Company 2010-2014
86
5
2012
2013
2014
1
to enhance resource provisions for the Company’s
innovative activity.
•
5
3
2.5
•
5
investment program, with R&D financing in the
amount of RUR 19,000 million. As of 1 January, 2011,
there are no exterior financing investments for R&D
and the source of R&D financing is centralized.
FEDERAL GRID COMPANY
ANNUAL REPORT
2010
Within the framework of its modernization program,
the Company introduces the following types of innovative equipment at its objects:
•
•
Static VAR compensator (SVC) is designed
to compensate for reactive capacity, managing
reactive capacity flow, stabilizing the voltage
level in the grid and restraining the commutation
of voltages and the compensation of asymmetric
grid modes. The composition of the device includes capacitor banks, thyristor reactor groups
and filters. SVC increases the carrying capacity of electric transmission lines and decrease
electricity losses in the grid. Compared with the
previous generation of compensators (synchronous compensators), the SVC is more compact
and has a greater response rate and an improved
level of reliability, with reduced electricity losses
in the devices compared with the synchronous
compensator and has lower operation costs.
Currently, SVCs are installed in the Trans-Baikal
Transforming Complex at the 220-kV Mogocha
substation, the 500-kV Novo-Anzherskaya
substation, the 220-kV Kirillovskaya substation,
the 220kV Aphipskaya substation, the 220-kV
Krymskaya substation and the 220-kV Slavyanskaya substation;
Controlled shunt reactor (CSR) 35-500-kV –
electro-magnetic reactors, the inductivity of
which may be gradually regulated with the assistance of the automatic control system, which
stabilizes the voltage of overhead lines with
huge charge capacity. Combined with condenser
batteries, connected in parallel, CSRs are analogs
of SVCs, allowing grid voltage to be maintained
under both light and heavy loads. The advantages of the CSR compared with ordinary shunt
reactors are 50% decreases in seasonal and daily
fluctuations, a 5-15% drop in high voltage line
capacity losses, an increase in the carrying capacity by 0.1-0.4 MW/MVAR of reactor capacity and
upping the reliability of the load center. The CSR
also takes away resource limitations of the
switch during the daily change in transferred
capacity. The average annual losses in CSRs are
10% lower than for uncontrolled shunt reactors.
CSRs are used at the 500-kV Nelym, the 220-kV
Urengoy and the 220-kV Nadym substations;
•
High-voltage cable with cross-linked polyethylene insulation is a hi-tech and ecologically clean product for the power industry. Using
cables instead of traditional electric transmission
lines with uninsulated wires decreases losses
to 0.01-0.05%, increases carrying capacity and
cuts the size of safety exclusion areas during
high voltage line construction under conditions
of urban fabric;
•
Optical transformers are used by the Company to measure current and voltage in pilot
projects and to upgrade the precision of measuring energy resources, as well as to increase the
operating reliability of relay protection and emergency controls (RPEC). As a result, not only is
the reliability of substation metering equipment
improved, but also exploitation of the grid is upgraded. Compared with the previous generation
of metering transformers, this equipment is explosion proof, is protected from interference and
has a high level of ecological safety. Currently,
the optical metering transformers for current
and voltage are used at the Digital Substation
training ground, which was created at Scientific
and Technical Center of the Power Industry.
During the fulfillment of the modernization program,
the Company broadens the use of three-phase two
winding auto-connected transformers with a voltage
of 330-500 kV with the goal of cutting capital expenses on transformer equipment to 30%, gas-insulated
switchgears for secondary distribution systems and
replaces oil switches and air switches with modern
sulfur hexafluoride switches, which upgrade the reliability of substations and the grid. At the Company’s
objects, new excess-voltage suppressors, disconnecting devices and absorbing vent fingers are installed.
87
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Smart Grid
Owing to the transition to long-term tariff regulation and investment planning, Federal Grid Company
was able to start realizing the long-term program of
modernizing Russia’s backbone electric grids. A part
of this program is creation of smart grid.
Smart grid unites electric grids, consumers and electric energy producers in a united automated system,
which allows for the real time monitoring and control of operating modes for all participants in the
production, transmission and consumption process
for electric energy. Smart grid automatically reacts
to changes in various parameters of the energy system and allows for uninterrupted power supply with
maximum economic efficiency (while decreasing the
impact of human factors).
Smart grids allows for:
•
•
•
•
•
Integrating all types of generation (including
small generators) and all types of consumers
(from households to large industries) for the
situational management of demand for their
services and active participation in energy system operation;
Changing real time parameters and grid topology, in accordance with current mode conditions,
excluding the origination and development of
emergencies;
Ensuring the broadening of market opportunities
for the infrastructure through the mutual provision of a broad range of services for market and
infrastructure subjects;
Minimizing losses, developing self-diagnosis and
self-recovery systems by observing reliability
conditions and electric energy quality;
Integrating the electric grid and information infrastructure to create an all-mode management
system with full-scale information support.
By creating an active adaptive (smart) grid, the following results will be achieved: regulating favorable
loads for consumers and ensuring the adaptive reaction of generation and grids in real time to various
deviations from constrained parameters, as well as
forecasting and preventing the origination of damaged sections and critical situations.
88
To test smart grid technology, energy clusters (segments of the energy system) were selected. Aſter
acquiring experience, it will be possible to discuss
expanding smart grid to a wider geographical area.
The first energy clusters are designated in the IES
of the East (the Amur, Primorye and Khabarovsk
Regions). The total economic effect from realizing
the pilot project to create smart grid on the territory of the IES of the East may be RUR10 billion per
annum.
The Company is the initiator and main coordinator of
the smart grid project. Partners and participants in
the project will be the System Operator, RusHydro,
RAO UES of the East, the Scientific and Technical
Center of the Power Industry, Dalenergostroyproekt,
Elektrozavod, ZETO (the electro-technical equipment
plant), Hyundai, ENER1 and other large scientific and
technical, as well as project organizations and power
equipment producers.
Smart grid development is performed by scientists
and specialists in many countries with a developed
energy sector, including: the United States, China
and India. European Union member states are jointly
working on the European Electric Grid of the Future
concept.
Creating smart grid calls for using various innovative
technologies and equipment:
•
Static control devices with changeable characteristics;
•
Short circuit discharge devices (commutation,
super-conducting and semi-conducting);
•
Electricity storage of various types and reasons
(high capacity accumulators, fly-wheel devices,
storage units and others);
•
Devices based on high temperature superconductivity (generators, transformers, direct and
alternate current cable lines, reactive power
compensators, short-circuit discharge devices
and others);
•
Semi-conductor devices (high capacity transistors, including silicon carbide transistors) and
second generation high temperature superconductors;
•
Equipment self-diagnostics in an online mode;
FEDERAL GRID COMPANY
•
•
ANNUAL REPORT
2010
Optical systems for electric parameter metering.
Soſtware complexes and information management
systems.
The Company has already introduced individual components of smart grid at its power facilities.
STATCOM
DIRECT CURRENT TRANSMISSION LINES
STATCOM
GRID ENERGY STORAGE SYSTEMS (GESS)
In August 2010, the Company concluded testing a unique
domestic solution – a new generation reactive power
compensator of the STATCOM type, which was installed
at the 400-kV Vyborg substation in December 2010.
Unlike foreign analogues, it uses only transistor vents,
which allows for more flexible management and additional
decreases in losses.
One of the elements of smart grid is the system of
grid energy storage. The GESS allow for the storing
of surplus electric energy generated by power plants
during minimum load hours and to later transmit it
during peak grid hours. This indicates a more evenly
distributed load for generating objects during the day
and the opportunity to avoid putting part of power
plants out of operation during the night. In addition,
owing to grid energy storage systems, optimal usage
conditions for the grid infrastructure are created:
they ensure capacity reserve needed in the event of
emergency situations in the energy system. These
systems are widely used in the United States and in
numerous European countries. The Company works on
implementing GESS on the basis of the 220-kV Psou
substation (Sochi) and the 330-kV Volkhov Severnaya
substation (St. Petersburg).
STATCOM is designed to support the required level and
quality of voltage, the regulation of capacity fl ows in
electric grids, the increase in transmission capacity for
lines and a decrease in electric energy losses. Compared
with SVCs with the same nominal capacity, STATCOM has
a lower capacity for the capacitor bank, filters and reactors
and has a higher response speed. The first STATCOM, with
a capacity of 50 MVAR, was put into operation at the
400-kV Vyborg substation, which increased the reliability
of electricity exports to Finland, decreased electric
energy losses and increased the capacity transmitted in
maintenance mode.
DIRECT CURRENT TRANSMISSION LINES
GAS-INSULATED SWITCHGEAR (GIS)
Gas-insulated switchgears significantly decrease the floor
space for substations and make their work noiseless.
The compact closed space, in which these devices are
installed, minimizes the impact of equipment on the
surrounding environment. Compared with the traditional
fitting of substations, the GIS has numerous advantages.
It has small dimensions, a long working life (50 years)
and strong protection from the impact of the external
environment, as well as high reliability, environmental
friendliness and safety. The GIS is already installed at
several Company’s power facilities, including the 220-kV
Volkhov-Severnaya, the 220-kV Zavod Ilyich and the
110-kV Rosa Khutor substations.
Direct current transmission lines are another element
of smart grid. Worldwide, there are already 60 such
lines and 40 that are in the design stage. It is planned
that such a line will be introduced at the 220-kV
Mogocha substation in the Trans-Baikal Territory. As a
result, the energy systems of Siberia and the Far East
will work in parallel, which, apart from the effect that
power plants’ reserves will signifi cantly upgrade power
supply reliability for the Trans-Siberian Railway.
89
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ABOUT THE COMPANY
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INVESTMENTS AND INNOVATIONS
ECONOMIC AND FINANCIAL PERFORMANCE
CORPORATE GOVERNANCE
SOCIAL RESPONSIBILITY
DIGITAL SUBSTATION
Digital Substation is one of the elements of the active
adaptive grid. The idea behind these substations is creating
new generation, control, protection and management
systems, in which all information is originated, processed
and managed by equipment in digital format. Modern digital
equipment functions to protect and control opportunities
for rapid information exchange between devices, which
ultimately provides opportunities for decreasing the
number of copper wiring connections and decreasing the
number of devices and locating them in a more compact
manner. This makes digital technologies more economic
at all implementation stages: their design, assembly,
adjustment and operation.
Pilot projects to create smart electric energy systems with
active adaptive grids, as realized by the Company, provide
for the development and introduction of digital metering
transformers and next generation digital equipment
complexes at the substations.
AUTOMATED TECHNOLOGICAL
MANAGEMENT SYSTEM (ATMS)
As one stage of constructing smart grid, the Company
realizes the project for creating ATMS. This system is
aimed at upgrading grid observability, preventing the
origination of abnormal modes and creating a system of
online monitoring and the smart diagnosis of equipment
condition. On the whole, using this system will increase
management effectiveness and the carrying capacity of
grids, both in normal and emergency regimes (as well
as in post-accident regimes). This will ensure the reliable
reception and transportation of energy and will operatively
provide WECM participants with high quality information
about operating regimes and the UNEG condition. ATMS will
be introduced in the MES North-West as a pilot project.
90
Scientific and Research, Design and
Experimental and Technological Work (R&D)
The comprehensive renewal of the Company’s
electric grid facilities is carried out in close
cooperation with scientific specialists.
In 2010 the Company developed and adopted the
2010-2014 R&D Program.
The Company also prepared the Concept for the
Russian Ministry of Economic Development to create
the Russia’s Smart Energy System Technological Platform, in which the Company is both an initiator and
participant. Within the framework of the technological platform, the Company will broaden cooperation
with leading research and development, as well as
project, institutions for creating both separate elements and complex projects for the smart grid.
FEDERAL GRID COMPANY
ANNUAL REPORT
2010
2010 volume of R&D financing broken down by directions:
1. Upon investment activities
Project
Developing the concept and theoretical basis
for creating the smart energy system with
the active adaptive grid (SES AAG)
New types of power equipment for substations
and transmission lines for the SES AAG
New types of facilities for control, automatics,
protection and metering systems for the SES AAG
2010 financing volume
(RUR, VAT included)
114,044,876.00
231,173,938.15
5,900,000.00
Management system of the SES AAG
187,230,600.00
System of monitoring and protecting against
the external impact on electric grids
435,394,800.00
Ensuring the safe and reliable
functioning of the UNEG and
the quality of provided electricity
transmission services
16,000,000.00
Upgrade in the energy effectiveness
of electric grids
10,000,000.00
TOTAL:
999,744,214.15
2. Upon core activity
Project
2010 financing volume
(RUR, VAT included)
Program for creating the flexible alternate
current transmission systems (FACTS)
12,907,479,50
Program for ensuring the explosion safety
of the electric grid objects
17,010,000,00
Program for protecting high voltage lines
and substation equipment against lightning
4,130,000,00
Development of multi-chamber insulator arrester
(MCIA) for 220-kV high voltage lines
2,909,200,91
TOTAL:
36,956,680,41
91
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2010 Results
As a result of implementing 2010-2014 R&D program, the list of high priority R&D work for 2010
and priority innovative development projects in
2010, the Company achieved the following results:
1.
•
•
•
•
•
•
•
•
92
Within the Program “New Types of Power Equipment for Substations and Transmission Lines
for the Smart Energy System with the Active
Adaptive Grid (SES AAG):”
Developed technical requirements for a 20-kV
high temperature super-conductive (HTS) direct
current cable line with a current rate of 2,500 A
and a length of 1,500 meters, with the goal of
limiting short circuit currents and upgrading the
reliability of electricity transmission in Moscow
and St. Petersburg;
Developed technical proposals for the short circuit current limiter based on the quick operating circuit breaker of explosive type which will
increase power supply reliability to urban areas
and large load centers;
Conducted work on enhancing design methodology for lightning protection for 110-750-kV high
voltage lines and substations;
Developed and tested mock-up models for digital
current transformers and voltage transformers
for 220-kV secondary distribution switchgear of
the digital substation;
Analyzed the effectiveness of installing compensating devices in the Kuban Energy System
to create a central automatic voltage regulation
system;
Conducted bench tests of the high temperature
super-conductor high voltage cable line with
a nominal voltage of 20 kV for the 110-kV
Belorusskaya substation at the testing ground
of Scientific and Technical center of the Power
Industry;
Developed a general scheme for the LNPP-2 –
Vyborg substation direct current transmission
line taking into account reconstruction of the
330/400-kV Vyborg substation and the technical
requirements for primary equipment;
Developed the framework and technological maps for the double circuit single-legged
multisided end pylons for the 220-kV Zeleny
Ugol Russkaya high voltage line crossing into
In 2010 the Company actively participated in
events dedicated to innovative development of
the Russian economy, including the St. Petersburg
International Economic Forum, the Innovation
Forum, the 2010 International Exhibition and
Conference on Innovative Projects in Network
and Electricity Supply (IPNES), the International
Forum “Energy of the Future” and the International
Power Industry Conference “Technological Basis
for Forming the New Russian Power Industry.”
•
cable line and basements for them;
Developed the framework and technological
maps for the single circuit double-column transitory multi-sided pylons for the 500-kV Krasnoarmeyskaya – Gazovaya high voltage line.
2.
Within the Program “New Types of Facilities
for the Control, Automatics, Protection and
Metering Systems for SES AAG,” the Company
prepared the project of technical requirements
and technical proposals to create the Phasor
measurement units (PMU) during the introduction of WACS/WAPS technologies in the SES AAG.
3.
Within the Program “Management System of
the SES AAG”:
Determined requirements and principles for creating the digital substation as an element of the
SES AAG;
Put into experimental industrial operation at
Scientific and Technical Center of the Power
Industry the first order of the Digital Substation
training ground.
•
•
FEDERAL GRID COMPANY
4.
•
•
•
•
•
•
5.
•
•
6.
•
Within the Program “System of Monitoring and
Protecting against External Impact on the Electric Grids:”
Developed the multi-chamber insulator arrester (MCIA)
for lightning protection of the 220-kV high voltage
lines;
Developed the project for preparing the 220-kV
high voltage line CHPP – SH30 branch of Federal
Grid Company – MES South to conduct experimental industrial exploitation of the MCIA-220
string with a system of complex monitoring;
Developed technical requirements for line discharges
with the external spark gap for increasing the lightning-surge-protection of the 220-330-kV high voltage lines in regions with low-conductivity ground;
Developed albums of regional maps for the climatic
zonation of Federal Grid Company branch – MES
Center – by the Belgorod, Voronezh, Kursk, Orel
and Tambov Regions with a maximum wind speed,
ice wall thickness, wind load during glazing storms
and the average annual length of storms in hours;
Developed maps of contamination levels at the
locations of high voltage lines and open switchgears of the Company branches – MES Center
and MES North-West;
Developed technical requirements for the
system of monitoring icing on overhead lines with the location method.
Within the Program “Ensuring the Safe and Reliable Functioning of the UNEG and the Quality of
Electricity Transmission Services Provided”:
Developed suggestions for planned energy system development, mechanisms for ensuring and
managing the reliability of Russia’s UES and the
UNEG under power sector reform conditions;
РDeveloped the Concept of ensuring power sector reliability, determining the forms and conditions for all subjects participating in the power
sector in ensuring its reliability at all development stages and functioning with the use of
complex means and measures to guarantee the
reliability and mechanisms for their realization.
Within the Program “Increasing Energy Saving
and Efficiency in Electric Grids:”
РDeveloped technical requirements for a prototype of the active harmonic filter for standard
ANNUAL REPORT
2010
•
•
•
7.
•
•
•
8.
•
•
•
•
•
high voltage converter installation at the 400-kV
Vyborg substation;
The Company developed and adopted the Program for Increasing Energy Saving and Efficiency
for 2010-2012 period (Minutes No. 843 dated
03.06.2010);
The Company’s 2010-2012 Energy Saving and
Efficiency Program was adjusted in accordance
with an Order by the Russian Federal Tariff Service and submitted for consideration by Federal
Grid Company’s Management Board (Meeting
date: 24.12.2010);
Prepared proposals for the utilization of the
heat from auto-connected transformers (ATP)
at the UNEG substations.
Within the Program “Developing the Concept and
Theoretical Basis for Creating Smart Russian
Energy System with an Active Adaptive Grid:”
Fulfilled the first stage of developing Russia’s
concept of a smart electric energy system with
an active adaptive grid, which is aimed at consideration by interested electric energy organizations;
Developed technical requirements and contractual
documentation. Signed 34 agreements to fulfill
R&D work;
Received 5 certificates of registration for computer
soſtware and 15 useful model patents.
Within the framework of the Company 2010-2014
investment program:
Put under voltage SVCs with a capacity of 50
MVAR at the 220-kV Aphipskaya, the 220-kV
Krymskaya and the 220-kV Slavyanskaya substations;
Conducted tests for the controlled CSR (UNShRTD - 180000/500) at the 500-kV Nelym
substation;
Put into experimental-industrial operation the
pilot model of the 50 MVAR STATCOM device at
the 400-kV Vyborg substation;
Put into operation new type CSR (UShRT
110000/25000) at the 220-kV Kogalymskaya
substation and the 220-kV Progress substation;
Put into operation the CSR (UShR 110000/25000)
at the 220-kV Selenduma substation;
93
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ABOUT THE COMPANY
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ECONOMIC AND FINANCIAL PERFORMANCE
CORPORATE GOVERNANCE
SOCIAL RESPONSIBILITY
•
Conducted preparatory work to put the switchdisconnector cell into experimental-industrial
operation at the 220-kV Dmitrov substation.
In 2010 the Company actively participated in events
dedicated to innovative development of the Russian
economy, including: the St. Petersburg International
Economic Forum, the Innovation Forum, the 2010
International Exhibition and Conference on Innovative Projects in Network and Electricity Supply
(IPNES), the International Forum “Energy of the
Future” and the International Power Industry Conference “Technological Basis for Forming the New
Russian Power Industry.” At the end of November 2010 the Company organized and conducted
a specialized international exhibition “Russian
Electric Grids – 2010” and a scientific and technical seminar on “Progress in Designing, Constructing
and Exploiting Electric Grids.”
In 2010 Federal Grid Company concluded 44 agreements on R&D cooperation with project and educational institutes, as well as with domestic producers
and foreign companies. Partners included Research
and Development Institute of Protective Devices
and Insulators, Sevkabel, Positron, Energomechanicheskiy Zavod, the Scientific-production Association
“Streamer,” Elektroapparat, Elektronmash, Novaya
Era, NIIEFA-ENERGO, Hyundai Heavy Industries and
Alstom Grid.
Attestation of Equipment,
Technologies and Materials
Within the framework of the testing system created
by Federal Grid Company, an assessment is carried
out regarding the possibility and expediency of using
new types of equipment, technologies and materials from different producers at the Company’s
facilities. The attestation procedure is performed
based on verifying production conditions, their
correspondence with standard requirements and
industrial and corporate documentation that takes
into account the experience of using such equipment. In addition, attention is paid to servicing the
equipment (the availability of a “hot” reserve and
dynamic responses from corporate specialists). This
procedure allows the Company to avoid supplying
94
unsatisfactory or obsolete equipment to the UNEG
objects.
The Company’s subsidiary Scientific and Technical
Center of the Power Industry is the leading organization that attests equipment for Federal Grid
Company.
In 2010 the Company had the following results from
testing out equipment, technologies and materials:
•
In 2010 the volume of accumulated applications decreased significantly (from 500 applications as of 01.01.2010 to 164 applications as of
01.01.2011);
•
Improved total realization indicators based on
the volume of applications received in 2009 and
2010;
•
Import substitution indicators were upgraded
and a competitive environment for selecting
equipment when organizing tender procedures
was created;
•
the list of producers of standard gas-insulated
switchgears for secondary distribution systems
with voltage class of 110-500 kV was broadened
(recommended for usage with more than 20
build types);
•
the list of auto-connected transformers with a
capacity of 167 MVA allowed for usage at the
Company’s facilities was expanded;
•
the nomenclature of attested 110-500-kV cable
production was broadened;
•
the list of producers of overhead-line hardware
for high voltage lines increased;
For the first time, the following items were tested out
and recommended for usage:
•
Controlled shunt reactors of types: UShR25000/110, UShR -180000/500, UShRT25000/110;
•
An automated controlled ice melting system;
•
Domestically produced modern gas-insulated
tank circuit breakers for 110 and 220 kV;
Due to attestation, a broad range of equipment design
was enhanced (power transformer, factoryassembled
switchgears with a voltage class of 6-20 kV, supporting
insulators with polymeric insulation with voltage class
FEDERAL GRID COMPANY
of 110-220 kV, UNShRTD-180000/500 type reactor,
phase differential protection L60 and P547, telemetry
complex SELTA STCE/RTU and others).
As a result of procedures conducted prior to 1
January, 2011, the number of applications transferred
to 2011 dropped to 164, whereas the total number
of applications considered for attestation and the
prolongation of expired certificates for attestation
commissions totaled 714 during the year.
ANNUAL REPORT
2010
In 2010 Federal Grid Company
concluded 44 agreements on
R&D cooperation with project
and educational institutes, as well
as with domestic producers and
foreign companies.
95
MOVING FORWARD
WITH NEW ENERGY
ANNUAL REPORT
2010
ECONOMIC
AND FINANCIAL
PERFORMANCE
STABILITY
IS A GUARANTEE
FOR GROWTH
4.0
ABOUT THE COMPANY
PRODUCTION OVERVIEW
INVESTMENTS AND INNOVATIONS
ECONOMIC AND FINANCIAL PERFORMANCE
CORPORATE GOVERNANCE
SOCIAL RESPONSIBILITY
Economic and Financial Performance
The main financial management tool used by Federal
Grid Company is a hierarchical budgeting structure.
The Company’s financial and economic planning covers the following levels:
•
•
•
Long-term planning involves a five-year financial plan broken down into one-year steps. This
involves establishing guidelines to implement
a government-mandated policy concerning the
UNEG management, as well as the Company’s
own strategic plans, subject to acceptable risk
levels and focused on financial sustainability;
Mid-term planning is built around a three-year
business plan, which is also divided into oneyear steps. The goal is to set mid-term financial
and production targets, to develop a production
program and to identify necessary resources
while balancing the economic interests of the
Company, its investors, customers, shareholders
and creditors;
Short-term or current planning focuses
on the Company’s annual budget with quarterly
interim steps. Budgeting helps the management
team align day-to-day activities with mid-term
targets outlined above.
•
With the goal of building a financial management
system that meets modern corporate governance
standards, Federal Grid Company has introduced the
following measures:
•
•
98
To implement a process-based management model, the Company has described and
regulated business processes and singled out
Business Planning and Budgeting processes.
The processbased management model is
currently being rolled out;
To form a financial structure, financial responsibility
centers have been formed;
•
•
A cash flow control system has been established;
A management accounting system has been
developed and implemented;
•
The budget management system was introduced
via efforts of the Company and its branches to
draſt , review, approve and execute budgets, control budget execution, maintain budget records,
and complain, review and approve budget reports.
The performance analysis system is based on comparing set targets with actual performance.
The Company’s cash flow management is grounded
in a mechanism that utilizes the centralized accumulation of cash as proceeds from operations, financing and investing it so that it can be used later to
finance operations and capital expenditures. Operations are financed by distributing funds to corporate
branches. Throughout 2010 the Company’s financial
management bodies focused on ensuring fi nancial
stability while working within the Company’s established leverage limits. One of the Company’s top
priorities in financial policy was to reduce operating costs per unit of equipment without sacrificing
grid servicing efficiency or reliability.
During 2008-2010 there was an increase in corporate revenues. In 2010 revenues from Federal Grid
Company’s usual activities grew by RUR26,007
million, or 30.6% year-on-year, driven by higher
revenues from electricity transmission services by
RUR29,337 million, or 36.6%. Compared to 2009,
the principal drivers of higher revenues from electricity transmission services were expanded corporate production capacities and a larger investment
program approved by Order No. 547 of the Russian
Ministry of Energy, as of 12 November, 2010.
FEDERAL GRID COMPANY
ANNUAL REPORT
2010
Financial Performance
Indicator (RUR, mln)
2008
2009
2010
Revenues
68,485
85,078
111,085
COGS
58,977
64,080
75,518
5,156
15,870
29,357
Other incomes
38,377
113,770
148,393
Other expenses
37,356
183,688
109,431
6,177
-54,049
68,319
7
-180
-33
-217
-722
-1,181
-3,225
-4,876
-9,264
Other similar compulsory payments
1,724
-39
249
Net profit (loss) for the reporting period
4,465
-59,866
58,088
Sales profit (loss)
Profit (loss) before tax
Deferred tax assets
Deferred tax liabilities
Current income tax
In 2010 the Company’s COGS (excluding administrative
expenses) increased RUR11,438 million (17.8%)
year-on-year, as a result of an increase in equipment
units, the launch of new facilities, inflation growth
and greater depreciation charges resulting from
PP&E revaluation.
In 2010 Federal Grid Company posted a net profit
of RUR58,088 million:
•
•
•
Additional profit generated by mark-to-market
financial investments;
Re-stored and accrued bad loan provisions that
were reduced by an amount equal to the provision for inventory depreciation;
Profit allocation to the Company’s investment
program.
99
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CORPORATE GOVERNANCE
SOCIAL RESPONSIBILITY
2010 Key Asset, Equity and Liability Figures in Accordance
with Corporate Accounting Reports, RUR mln
Indicator
As of 31.12.2008
As of 31.12.2009
As of 31.12.2010
Indicator
723,940
660,517
871,546
Non-current assets
511,588
437,915
640,787
Current assets
212,353
222,602
230,759
Total equity and liabilities
723,940
660,517
871,546
Equity
666,177
579,467
763,884
Long-term liabilities
18,622
7,440
52,668
Short-term liabilities
39,141
73,609
54,994
Revenue and Expense
Performance
120,000
The above balance sheet data indicates no clear
trend. There were declines in 2009, compared to
2008, and growth in 2010, compared with 2009.
111,085
100,000
85,078
80,000
75,518
68,485
64,080
60,000
58,977
58,088
40,000
In 2009 non-current assets declined in value. The
principal reason was a revaluation of long-term financial investment, due to lower market value for
securities in the Company’s portfolio and that a portion of the Company’s long-term investments were
re-classified as short-term ones.
20,000
4,465
0
2008
2009
-20,000
•
-40,000
-60,000
Revenue
COGS
Net profit (loss) for
the reporting period
100
2010
In 2010 Federal Grid Company’s total assets grew,
driven primarily by a higher non-current assets value.
The following factors affected the 2010 increase in
non-current assets:
-59,886
•
•
Higher construction-in-progress value as the Company implemented its investment program;
Increased long-term financial investments primarily
due to mark-to-market financial investments and
the reclassification of Energo-Finans promissory
notes from long-term receivables to long-term
financial investments under novation contract;
Increased PP&E, which was revalued 1 January,
2010, with the revaluation netting a total of RUR
86 billion.
FEDERAL GRID COMPANY
The increase in Federal Grid Company’s current assets
was driven by the following factors:
•
•
•
•
Increased inventories, including materials, due to
larger material procurement for repair activities
using the Company’s own resources;
Reduced long-term accounts receivable, partly as
a result of reclassifying Energo-Finans promissory notes from long-term receivables to longterm financial investments under novation contract and redeeming promissory notes of Mobile
GTES;
Increased short-term accounts receivable as
advance payments required for the investment
program grew and bad-loan provisions for the
promissory notes of Energy Index – Federal Grid
Company were re-created;
Reduced short-term financial investments driven
by a reduction in Federal Grid Company’s cash
deposits at banks.
In 2010 the Company’s equity grew at a higher rate,
driven by an increase in Federal Grid Company’s share
capital following the registration of a RUR40,178
million equity issue in 2009, an increase in surplus
capital driven by PP&E revaluation and a RUR58,088
million net profit reported in 2010.
ANNUAL REPORT
2010
2010 liquidity ratios indicate that Federal Grid Company
is capable of meeting its short-term obligations.
The cash, current, and quick ratios are all high, which
is considered a positive factor given that the current
ratio is within the normal range of 1 and 2, whereas,
the quick ratio is between 0.7 and 0.8. The reported
values illustrate that the Company has reasonably
high levels of both liquidity and solvency.
In 2010 the year-on-year decline in liquidity ratios was
caused by a reduction in short-term financial investments following a decline in Federal Grid Company's
deposited cash at banks, the redemption of promissory notes of VTB Bank and Glavsetservis UNEG and
the purchase of short-term promissory notes from
Alfa Bank and Bank Rossiya.
Assets Structure
Performance
350,000
296,644
300,000
236,193
250,000
212,353
222,602
216,530
230,759
200,000
In 2010 the increase in the Company’s short-term
receivables was driven by series 7, 8, 9, 10 and 11 bond
issues aimed at financing the corporate investment
program.
As with the previous year, during the 2010 reporting period, the Company increased its share capital.
This resulted in payables to participants in contributions to share capital being reported as short-term
liabilities. Following the FFMS registration of the
Report on results of the additional share issue, this
amount became part of share capital. In the 2010
reporting, this was equal to RUR11,194 million, whereas in the 2009 report, it totaled RUR40,178 million.
150,000
150,374
150,245
151,604
100,000
50,000
0
2008
2009
2010
PP&E
Construction in progress
Current assets
101
4.0
ABOUT THE COMPANY
PRODUCTION OVERVIEW
INVESTMENTS AND INNOVATIONS
ECONOMIC AND FINANCIAL PERFORMANCE
CORPORATE GOVERNANCE
SOCIAL RESPONSIBILITY
The ratio of equity to total assets demonstrates the
degree of financial independence from creditors.
In 2010 the change in this ratio was driven by an
increase in total assets and is currently at a fairly
high level, pointing to Federal Grid Company's strong
financial stability.
Profitability ratios continued to increase during the
reporting period. The main growth factor is higher
profit before tax (without taking external factors into
consideration).
Federal Grid Company’s aſter-tax profit (net profit), as
per accounting statements, is the source for accruals
of the corporate reserve fund and for paying dividends.
In FY 2010 Federal Grid Company reported a net profit
of RUR58,088 million.
Net Profit Distribution
2008-2010 Corporate Financial Ratios
Indicator
31.12.2008
31.12.2009
31.12.2010
Cash ratio
1.41
2.41
1.3
Quick ratio
5.01
5.91
4.9
Current liquidity
5.43
6.66
5.3
Equity to total assets
0.92
0.94
0.89
Leverage
0.09
0.07
0.12
47.8
47.5
61.5
Operating margin***, %
6.5
11.1
23.2
Return on assets***, %
0.62
1.4
3.0
Assets turnover
0.09
0.13
0.13
Liquidity*
Capital structure**
Profitability
EBITDA margin***, %
*
For 2009-2010, payables were reduced by amounts owed to shareholders for shares contributions.
**
For 2009-2010, charter capital was increased by amounts owed to shareholders for shares contributions.
*** For 2009-2010, the impact of factors outside Company management competencies was not taken into
account when calculating EBITDA (net profit).
102
FEDERAL GRID COMPANY
ANNUAL REPORT
2010
2008-2010 Net Profit Allocation, RUR mln
31.12.2008
31.12.2009
31.12.2010
4,465
-59,866
58,088
–
–
25,777
Reserve fund
223
––
2,904
Development
4,242
–
18,578
Compensation for previous year losses,
remuneration to members of the
Company’s Board of Directors
–
–
34,028
Dividends
–
–
2,577.7
Retained profit (loss) for the
reporting period:
Net profit, adjusted
Distribution:
The profit primarily consists of:
•
•
•
Positive financial results from mark-to-market of
shares (not secured by monetary funds);
Positive financial results from re-storing and
accruals of bad-debt provisions, reduced by an
amount equal to the provision for inventory depreciation (not secured by monetary funds);
Profit from corporate operations.
The Company plans to distribute posted net profit in
the following way:
1.
2.
In accordance with Article 35 of Russian Federal
Law No. 208-FZ dated 26 December, 1995 “On
Joint Stock Companies,” the Company plans to
allocate 5.0% of net profit, or RUR2,904,419,000,
to its reserve fund;
The profit of RUR18,578,192,000 will be allocated
to development, including RUR16,614,772,000
to be allocated to finance the Company’s approved
2010 Investment Program, RUR1,277,414,000
for financing capitalized interests accrued on
loans raised for the Company’s Investment
Program and RUR686,006,000 for purchasing
PP&E.
3.
4.
In accordance with Clause 4.3 of Federal Grid
Company’s Regulations on Dividend Policy, the
Company plans to pay dividends based on net
profit secured by monetary funds and excluding
financial results from security revaluations and
provision accruals. Dividends totaling 10% of net
profit are backed by monetary funds and equal
RUR2,577,664,000.
RUR34,028,113,000 of net profit are allocated
to cover losses posted in 2009, as a result of
losses from asset revaluation and the provision accruals, and as remuneration to be paid to
members of the Board of Directors in accordance
with Clause 4.3 of the Federal Grid Company’s
Regulations on Compensation and Remuneration
to Members of Board of Directors, as approved
by the Resolution of the General Shareholders
Meeting dated 26 June, 2010 (Minutes No. 9 as
of 2 July, 2010).
103
4.0
ABOUT THE COMPANY
PRODUCTION OVERVIEW
INVESTMENTS AND INNOVATIONS
ECONOMIC AND FINANCIAL PERFORMANCE
CORPORATE GOVERNANCE
SOCIAL RESPONSIBILITY
4.1 TARIFF REGULATION
Electricity transmission via the UNEG is Federal Grid Company’s
principal activity. These services are considered to be a natural
monopoly in the electric energy sector, with prices (tariffs)
subject to state regulation.
Prior to 2010 tariffs for Federal Grid Company's electricity transmission services via the UNEG were based
on the economically sound pricing method of regulation and were equal to:
Year
Tariff for electricity transmission,
RUR MW/month
Tariff growth, %
2009
58,159.01
20.7
Since 2010 the tariff regulation method transitioned
to the return on invested capital (Regulatory Asset
Base or RAB regulation).
Year
Tariff for electricity transmission, RUR MW/month
Tariff growth, %
2010
87,868.77
51.1
Within the RAB method, the basis for tariff calculation
is invested capital, which consists of:
•
Initially invested capital, which is valued by an
independent appraiser. This includes the cost of
assets replacement by the Company needed to
carry out operations subject to regulations and
the physical, moral and external wear and tear
of assets;
104
•
Newly invested capital, i.e. capital value
which is used to create new assets following
implementation of the Company’s approved
investment program.
Gross revenues needed for tariff calculations for each
year of the reviewed regulatory period are the sum
of recovery and the return on invested capital and
expenses needed to carry out operations subject to
regulation.
FEDERAL GRID COMPANY
ANNUAL REPORT
2010
The following main tariff regulation parameters for
the Company have been outlined for 2010-2012:
2010
2011
2012
Value of invested capital
as of 01.01.2010, RUR bln
647.6
–
–
Return on existing capital
as of 01.01.2010, %
3.9
5.2
6.5
Return on newly
invested capital, %
11
11
11
Return period on invested
capital, years
35
35
35
Throughout 2010 Federal Grid Company's efforts
were aimed at fostering sustainable development
in investing. The Russian Ministry of Energy approved the corporate investment program for a five
year period – from 2010 till 2014 – in the amount of
RUR952.4 billion. At the same time, conversations
with the Russian Government resulted in a decision
in 2H 2010 to extend the first long-term regulatory
period from three to five years.
Tariff regulation parameters meeting the Company’s
long-term plans have been approved for 2013 and 2014:
2013
2014
Return on existing capital
as of 01.01.2013, %
7.8
9.1
Return on newly
invested capital, %
10
10
Period of return on invested
capital, years
35
35
105
4.0
ABOUT THE COMPANY
PRODUCTION OVERVIEW
INVESTMENTS AND INNOVATIONS
ECONOMIC AND FINANCIAL PERFORMANCE
CORPORATE GOVERNANCE
SOCIAL RESPONSIBILITY
Order No. 486-e/3 from the FTS, dated 28
December, 2010, for Federal Grid Company:
Stipulated tariffs for electricity transmission services
via the UNEG for the long-term regulation period
Tariff for electricity
transmission
Tariffs for 71 Russian
Federal subjects
Differentiated tariffs for 7
Russian Federal subjects*
Tariff for electricity
transmission
Tariffs for 71 Russian
Federal subjects
Differentiated tariffs for 7
Russian Federal subjects*
(2011-2014) based on the RAB regulation method.
Tariffs were amended in line with Russian Government's Resolution No. 1172 dated 27 December,
2010:
2011
Growth, %
2012
Growth, %
111,083.35
26.4
140,416.32
26.4
43,783.55
15.7
55,345.15
26.4
2013
Growth, %
2014
Growth, %
177,310.69
26.3
223,918.60
26.3
69,887.09
26.3
88,257.61
26.3
* In accordance with Resolution No. 109 “On Pricing for Electric and Heat Energy” by the Government of the Russian Federation dated
26 February, 2004, the Stavropol Region, the Chechen Republic, the Republic of Ingushetia, the Republic of Dagestan, the Republic of
North Ossetia-Alania, the Kabardino- Balkarian Republic and the Karachayevo-Cherkessian Republic were classified as Russian Federal
subjects with differentiated electricity transmission services tariffs via the UNEG.
106
FEDERAL GRID COMPANY
In accordance with the tariff regulation based on
long-term tariffs subject to the return on invested
capital, Federal Grid Company is obliged to meet reliability and quality criteria for its services as outlined
by the Russian Ministry of Energy.
Russian Ministry of Energy Order No. 296 dated
26 June, 2010 outlined Guidelines for Product and
Service Reliability and Quality Criteria for the Company Managing the UNEG and for Territorial Grid
Enterprises.
Criteria include indicators of electricity transmission
reliability, which help identify technological disruptions and consumer consequences and quality of
consumer services, which for Federal Grid Company
principally involve enabling consumers’ technological
connection.
Indicator
ANNUAL REPORT
2010
The FTS by its Order No. 254-e/1 dated 26 October,
2010 approved the Guidelines for the Calculation and
Use of +/- Adjustments Ensuring That Tariff Levels
for Companies Involved in Operations Subject to
Regulation Meet Reliability and Quality Criteria for
Goods And Services. In line with these guidelines, the
Company’s revenues will be adjusted in the +/- 3%
range.
The FTS decision on 2011-2014 tariff s stipulated
target indicators for the reliability and quality of
services provided by the Company managing the
UNEG during the 2011-2014 period.
Regulation period
2011
2012
2013
2014
Service reliability
0.0490
0.0483
0.0475
0.0468
Service quality
1.2599
1.2410
1.2224
1.2040
Federal Grid Company’s transition to RAB regulation ensured suffi cient fi nancial potential to tackle
major investment tasks. Implementing the approved investment program will help upgrade the
reliability of electricity supplies to consumers, ensure the provision of capacity to power stations,
upgrade electric grids and implement numerous
important government-mandated projects.
RAB regulation also involves a fundamentally new approach to cost management and operational expense
effi ciency: the new level is 2% per annum. The Company faces the serious task of working out a balanced
expense management policy that weighs reducing
expenses with meeting existing reliability and quality
criteria, which is heavily dependent on the level and
effi ciency of repairs and maintenance.
107
4.0
ABOUT THE COMPANY
PRODUCTION OVERVIEW
INVESTMENTS AND INNOVATIONS
ECONOMIC AND FINANCIAL PERFORMANCE
CORPORATE GOVERNANCE
SOCIAL RESPONSIBILITY
4.2 COST OPTIMIZATION
The Company has implemented the 2010 Cost Management Program aimed at upgrading operational
efficiency, reducing operational and administrative
overhead and implementing anti-crisis measures.
Principal focuses of the 2010 Cost Management
Program included:
Reducing the Company’s administrative and
operational costs.
Following the 2010 transition to tariff regulation
based on the return on invested capital, efficiency
improvement is one of the Company’s top priorities.
Under the 2010 Cost Management Program, the
Company experienced a cumulative effect from reductions in production costs and product (or service)
sales worth a total of RUR2,613 million, which is in
line with the target level.
In 2010 the Company fully implemented measures to
reduce the UNEG grid losses. The cumulative energy
saving effect from measures carried out in 2010
totaled 291.640 million kWh. In 2010 the economic
effect from Federal Grid Company’s Energy Saving
and Energy Efficiency Improvement Program totaled
RUR143.2 million in value.
Optimizing the procurement program.
The Company implemented a procurement program
to source products and services on a transparent
competitive basis from suppliers that offer the best
value for money.
All procurement procedures now involve compulsory
activities aimed at reducing prices offered by participants (re-auction). The resulting economic effect
can be an additional 1-2% of the cost of purchased
products and services.
The compulsory re-auction (voluntary increases in
pricing offers by auction participants) threshold was
108
also reduced from a total procurement amount of
RUR100 million to RUR50 million.
Reducing the Company’s
investment expenses.
The Company is implementing steps to cut investment project expenses with a focus on specifics in the
service market and material resources in electric grid
construction. These measures are carried out across
all stages of the investment program and involve
expense-cutting steps.
The Company’s investment program involves a series
of procurement measures to save investment without
compromising the number and quality of investment
projects implemented by the Company.
In 2010 the Company carried out nearly 2,500
procurement procedures worth approximately
RUR400 billion. From this amount, RUR360 billion
was investment-related procurement. Procurement
procedures resulted in an economic effect of RUR41.6
billion from the initial ceiling price, with RUR37.3
billion of this amount saved on investment-related
procurement.
Over the next several years, cost reduction is a corporate priority in line with its main strategic goal –
ensuring the reliability and up-to-date expansion of
the UNEG in line with economic growth and maximizing cost containment. To improve efficiency,
reduce and optimize operational and administrative
overheads and cut production costs, the Company
developed a series of cost-cutting measures for the
2011-2014 period.
The Company plans that economic effects from
the 2011-2014 cost reduction program will reach
RUR4,600.2 million, driven by the improved effi ciency of procurement procedures, reduced auxiliary
power requirements and lower prices for repairs carried out by external contractors without sacrificing
the actual amount of carried out work.
FEDERAL GRID COMPANY
ANNUAL REPORT
2010
4.3 CREDIT PORTFOLIO
AND LIQUIDITY
Primary Principles of Temporarily Free Cash Allocation Cash
position management aims to achieve the maximum return
on investment, while maintaining a reasonable risk/return ratio.
The Company earned returns on financial investments
by depositing temporarily available cash with
Russia’s largest and most reliable financial and credit
institutions which offer the highest interest rates
possible.
2008-2010 Credit Portfolio
Performance, RUR mln
60,000
56,000
50,000
Banks were selected based on the valuation of
their financial and operating performance and their
reputation. Principal cash placement tools included
placing cash in deposits, maintaining it in current
accounts and keeping it in bank promissory notes,
based on maturity.
A balanced approach to liquidity management,
optimizing the placement structure in terms of returns
and maturities, and risk minimization measures ensured
significant additional income for the Company.
40,000
10,000
30,000
20,000
5,000
13,000
10,000
17,980
0
Safeguarding the Company’s and its shareholders’
interests, as well as setting limits on counterparty
banks, are carried out in accordance with Regulations
on the Procedure for Placing Temporarily Available
Cash, as approved by the Company’s Management
Board on 28 April, 2008 (Minutes No. 528).
31.12.2008
31.12.2009
31.12.2010
Credits under
Alfa Bank credit line
EBRD loan
Bond issues
As of 31 December, 2010, the Company’s credit portfolio
consists entirely of bonds and is worth RUR56 billion.
109
4.0
ABOUT THE COMPANY
PRODUCTION OVERVIEW
INVESTMENTS AND INNOVATIONS
ECONOMIC AND FINANCIAL PERFORMANCE
CORPORATE GOVERNANCE
SOCIAL RESPONSIBILITY
Bonds issues, outstanding
Non-convertible
interest-bearing documentary bonds with mandatory safekeeping at a centralized depository
Облигации
Bonds
Series
04
06
07
08
09
10
11
6
10
5
10
5
10
10
Coupon rate, %
7.3
7.15
7.50
7.15
7.99
7.75
7.99
Placement date
12.10.2006
28.09.2010
29.09.2010
28.09.2010
29.10.2010
28.09.2010
29.10.2010
Put option date
06.10.2011
24.09.2013
24.09.2015
24.09.2013
24.10.2017
22.09.2015
24.10.2017
Maturity period,
years
5
10
10
10
10
10
10
182
182
182
182
182
182
182
1,000
1,000
1,000
1,000
1,000
1,000
1,000
Open
subscription
Open
subscription
Open
subscription
Open
subscription
Open
subscription
Open
subscription
Open
subscription
Issue amount,
RUR bln
Coupon period, days
Placement price,
RUR
Placement method
Loans and Credits
In 2010 the Company’s credit portfolio grew 4.3-fold,
with the Company placing public bonds worth RUR
50 billion. On 22 June the Company redeemed a
Series 2 bond issue worth RUR7 billion.
The bonds were placed to an unlimited number of
investors via open subscription on the MICEX Stock
Exchange. Proceeds from the bond placement
were used to finance the Company’s investment
program.
2010 Bond Issues
The FFMS registered Federal Grid Company’s
bond issue with a total volume of RUR50 billion on
5 November, 2009. The decision to place the bonds
was made by the Company’s Board of Directors
on 21 September, 2009 (Minutes No. 89 dated
24 September, 2009).
In case of liquidity shortfalls, Federal Grid Company can
also use, in addition to financing sources mentioned
above, borrowed funds provided via revolving lines of
credit from Sberbank of Russia, Gazprombank and
Alfa Bank – each worth RUR 15 billion.
On 28 September, 2010, the Company placed Series
06, 08 and 10 bonds worth a total of RUR30 billion.
On 29 October it completed placing Series 07, 09 and
11 bonds worth a total of RUR20 billion.
110
Oversight of the Company’s debt position and
valuation of its credit potential is based on a credit
policy approved by the Company’s Board of Directors
29 September, 2010 (Minutes No. 116).
FEDERAL GRID COMPANY
ANNUAL REPORT
2010
4.4 CREDIT RATINGS
Federal Grid Company’s solid creditworthiness
and financial stability have been confirmed by credit
ratings from leading international ratings agencies.
The Company’s current credit ratings are all investment-grade, indicating that its key performance
indicators are at the level required to meet financial
obligations in full as they become due.
Credit Rating History
During the Past 3 Years:
30 December, 2010
Moody`s confirmed its rating as part of
its annual rating revision.
18 June, 2010
S&P confirmed Federal Grid Company’s
credit ratings.
30 December, 2009
Moody’s confirmed its rating as part of its annual
rating revision
22 December, 2009
S&P upgraded the outlook for Federal Grid Company
from negative to stable. The long-term credit rating
was confirmed at BBB and the rating on the national
scale at ruAAA.
14 April, 2009
S&P confirmed its long-term credit rating at BBB
and its rating on the national scale at ruAAA, outlook
negative.
Credit ratings as of 31 December, 2010:
Ratings
agency
Rating
International
scale
National
scale
Standard & Poor's
BBB/outlook stable
ruAAA
Moody's
Baa2/outlook stable
Aаа.ru
08 December, 2008
S&P downgraded its outlook for Federal Grid Company from stable to negative, to reflect the sovereign
rating outlook. The long-term credit rating was confirmed at BBB.
28 October, 2008
S&P removed Federal Grid Company’s long-term
ratings, for both foreign and national currency obligations, from the CreditWatch list, with a positive
outlook. At the same time, S&P confirmed Federal
Grid Company’s long-term ratings for its foreign and
national currency obligations at ВВВ and at ruAAА on
the national scale, with a stable outlook.
23 July, 2008
Moody’s confirmed its credit rating at Baa2 (stable
outlook), as well as at Aaa.ru on the national scale.
04 April, 2008
Federal Grid Company’s rating from S&P was upgraded to BBB on the international scale, with a positive
outlook, and it remained on the CreditWatch list. On
the national scale, Federal Grid Company’s rating was
upgraded to ruAAA as a result of a ratings revision.
111
MOVING FORWARD
WITH NEW ENERGY
ANNUAL REPORT
2010
CORPORATE
GOVERNANCE
INCREASED EFFICIENCY
THROUGH COOPERATION
5.0
ABOUT THE COMPANY
PRODUCTION OVERVIEW
INVESTMENTS AND INNOVATIONS
ECONOMIC AND FINANCIAL PERFORMANCE
CORPORATE GOVERNANCE
SOCIAL RESPONSIBILITY
5.1 CORPORATE
GOVERNANCE PRINCIPLES
The Company is committed to upgrading its corporate
governance system, aiming to enhance our investment appeal
and to reduce the risk of crisis situations. The integrated corporate
governance system encompasses relationships with stakeholders
and subsidiary and dependent companies (SDCs), internal control,
risk management and internal audit.
The cornerstone of the Company’s corporate
governance system is its corporate governance
principles, which were outlined by the Corporate
Governance Code of the Federal Commission for
Securities Market, the Company's Code of Corporate Governance, as well as acclaimed global best
practices, such as the Principles of Corporate Governance of the Organization for Economic Co-operation
and Development (OECD).
Accountability. The Board of Directors is accountable to all shareholders for full compliance
with all applicable legislation.
Corporate Governance Principles
Responsibility. The Company recognizes the rights
of all stakeholders, as provided for by applicable
legislation, and aims to cooperate with them, helping to grow the Company and ensure its financial
sustainability.
Responsibility
Accountability
Fairness. The Company is committed to defending
shareholders’ rights and to treating all shareholders equally. The Board of Directors effectively defends all shareholders in case any of these rights
are violated.
The Company is liable for its obligations to the full
extent of property it owns.
Transparency
Fairness
Transparency. The Company promptly discloses
all significant facts related to our operations, including our financial standing, social and environmental
performance, operational results, ownership structure
and corporate management. The Company makes
this information accessible to anyone who might be
interested.
114
The Company and the Company’s registrar STATUS
are jointly liable for losses incurred by shareholders
as a result of a loss of shares or the inability to
exercise rights documented by shares as a result
of improper compliance with the Company’s shareholder registry maintenance and development
procedures unless due compliance is deemed impossible as a result of force majeure or actions
(lack of actions) on the part of shareholder that requires compensation for losses, including as a result
of the shareholder failing to take reasonable measures to reduce such losses.
FEDERAL GRID COMPANY
Responsibilities of the Company’s
management bodies:
In exercising their rights and carrying out their
duties, members of the Board of Directors, the
Chairman of the Management Board and members of
the Management Board act in the best interests of the
Company, display integrity and wisdom in exercising
their rights and performing their duties with
respect to the Company and will be held liable to the
Company if it incurs losses due to their wrongdoing
(or inaction).
ANNUAL REPORT
2010
•
•
•
•
•
Members of the Board of Directors, the Chairman
of the Management Board and members of the
Management Board will be held liable to the
Company and/or its shareholders for losses incurred
by their wrongdoing (or inaction) which violate
the Company’s share acquisition procedure. Members of the Company’s Board of Directors and the
Management Board who voted against the decision that incurred losses for the Company and/or
its shareholders or who did not take part in the
voting are not held liable.
The Company implements the above-mentioned
principles by doing the following:
•
Generating profit and increasing share value;
•
Complying with existing legislative norms and
meeting best international practices in corporate
governance;
•
Ensuring that shareholders and other stakeholders
have access to information about the Company’s
outlook, the objectives it pursues, the timeline and
its methods of achieving them and possible risks and
influences from the outside environment;
•
Maintaining a long-term focus in its operations;
•
Making major decisions about the Company’s
operations with the involvement of shareholders
who vote at shareholders meetings;
•
Providing shareholders with the opportunity
to vote at a meeting either in person or by proxy;
•
Providing shareholders with the information
they need to exercise their voting right at the
Company’s shareholders meetings;
•
Offering equal rights on the same type of shares;
•
Providing shareholders with the opportunity to
exercise their voting right at the Company’s
shareholders meetings based on the “one share,
one vote” principle;
•
•
Ensuring the Company’s transparency: functions and
competencies of each management body must be
clearly defined and outlined in writing;
Disclosing signifi cant information about its
operations;
Providing precise, unbiased, timely and
accessible information that is sufficient to make
a balanced decision;
Maintaining ongoing close relationships with
shareholders and providing them will all necessar y information and documents;
Carrying out audit inspections and examinations
by the Audit Commission;
Stipulating that members of the Board of Directors
display integrity, wisdom, fairness and loyalty;
Ensuring environmental protection, labor safety
and social guarantees for its employees.
Internal Documents
Corporate governance structures, procedures
and practices are regulated by the following
internal documents:
•
•
•
•
•
•
•
•
•
•
•
•
•
•
•
•
Articles of Association;
Regulations on the Procedure for Preparing and
Holding the General Shareholders Meeting;
Regulations on the Management Board;
Regulations on the Audit Commission;
Regulations on Compensation and Remuneration
to Members of the Audit Commission;
Regulations on the Board of Directors;
Regulations on Compensation and Remuneration
to Members of the Board of Directors;
Regulations on Remuneration to Members of
the Committees of Board of Directors;
Code of Corporate Governance;
Regulations on the Information Policy;
Regulations on the Dividend Policy;
Regulations on the Insider Information;
Regulations on the Audit Committee of the Board
of Directors;
Regulations on the HR and Remuneration Committee of the Board of Directors;
Regulations on the Investment Committee;
Regulations on the Strategy Committee;
To access the full texts of the above-mentioned documents,
please visit our corporate web site: http://www.fsk-ees.ru/eng/
investors/corporate_governance/corporate_documents/.
115
5.0
ABOUT THE COMPANY
PRODUCTION OVERVIEW
INVESTMENTS AND INNOVATIONS
ECONOMIC AND FINANCIAL PERFORMANCE
CORPORATE GOVERNANCE
SOCIAL RESPONSIBILITY
The new version of the Company’s Articles of Association was approved in 2010, to align the text with
changes in legislative requirements, to adjust the
competencies of the Company’s management bodies
and to include corporate changes that had taken place
earlier (for example, changes in the share capital and
the Company’s placed and authorized shares).
Changes in legislative requirements were reflected in
the new Regulations on the Procedure for Preparing and
Holding the General Shareholders Meeting.
The supreme management authority of Federal Grid
Company is the General Shareholders Meeting. The
Board of Directors outlines the general focus for the
Company’s development and supervises operations
of the Company’s Management Board, which is responsible for managing the Company on a day-today basis. The Management Board is elected by the
Company’s Board of Directors. The sole executive
body is the Chairman of the Management Board, who
is elected by the General Shareholders Meeting.
Managing SDCs is based on Regulations on Subsidiary and Dependent Companies’ Management. The
Regulations outline the way that the Company implements the rights of shareholders (participants)
to ensure the effective performance of corporate
representatives at General Shareholders (participants) Meetings, on the Board of Directors and the
Audit Commissions of SDCs, and sets the general
framework for corporate interaction between the
Company and its SDCs related to corporate planning,
organization and the control of corporate activities in
the decision-making of SDCs bodies with respect to
issues that under the Articles of Association require
that Federal Grid Company state its position.
Organizational Structure of Management Bodies
election
General Shareholders
Meeting
control
election
reports
Independent
External Auditor
recommendations
election
election
Audit Commission
election
Board of Directors
(11)
control
election
appointment
Internal
Audit
preparation
of materials
Chairman
and control
reports
Management Board
recommendations
performance
monitoring
reports
Branches
(51)
116
reports
recommendations
Committees:
Audit Committee
HR and Remuneration
Committee
Strategy Committee
Investment
Committee
FEDERAL GRID COMPANY
ANNUAL REPORT
2010
5.2 BOARD OF DIRECTORS
The Board of Directors outlines the Company’s strategy and key
development focuses and oversees the performance of executive
bodies to ensure that the interests of the Company and
its shareholders are served.
The Board of Directors acts in accordance with
Russian Federal Law No. 208-FZ dated 26 December,
1995, Russian legislation and the Company’s internal documents: Articles of Association, the Code of
Corporate Governance and Regulations on the
Board of Directors.
The Board of Directors is elected by cumulative voting
at the General Shareholders Meeting for a oneyear
period and consists of 11 members. In accordance
with the Company’s Articles of Association, six directors must represent the State. An obligatory requirement of the Company’s Articles of Association is that
the Board of Directors includes members representing the Market Council – a not-for-profit partnership
that unites companies in the power sector and large
electricity and heat power consumers.
To ensure unbiased decision-making by the Board
of Directors and balanced interests for different
shareholder groups, the Company strives to have
at least three independent directors on its Board
of Directors.
In 2010 Federal Grid Company had two different
compositions of its Board of Directors. Until 29
June, 2010, the Board of Directors was composed of
members elected by the Company’s Annual General
Shareholders Meeting (which was held 30 June,
2009).
№
Name
Position
1
Boris Ayuyev
member
2
Evgeny Dod
member
3
Mikhail Kurbatov
member
4
Alexey Makarov
member
5
Andrey Malyshev
Deputy Chairman
6
Sergey Maslov
member
7
Dmitry Ponomarev
member
8
Vladimir Tatsiy
member
9
Ernesto Ferlenghi
member
10
Rashid Sharipov
member
11
Sergey Shmatko
Chairman
117
5.0
ABOUT THE COMPANY
PRODUCTION OVERVIEW
INVESTMENTS AND INNOVATIONS
ECONOMIC AND FINANCIAL PERFORMANCE
CORPORATE GOVERNANCE
SOCIAL RESPONSIBILITY
Composition of the Board of Directors,
as of 29 June, 2010
(The positions of the Board of Directors members are
those that they held at the time they were elected
to the Board)
Sergey Shmatko
Chairman
Born: 1966
Education: From 1983-1990 he studied in the Political Economics Department and the Mathematics
and Mechanics Department of Ural State University
(Sverdlovsk). From 1990-1992, he studied in the Economics Department of the University of Marburg
(Germany). In 2004, he attended the Graduate School
of the Military Academy of the General Staff of
Russia’s Armed Forces and received a degree in
Defense and Maintaining Russia’s National Security.
Holds the following positions:
•
Minister of Energy of the Russian Federation;
•
Chairman of the Board of Directors of
Zarubezhneſt ;
•
Chairman of the Board of Directors of Federal
Hydro-Generating Company;
•
Member of the Board of Directors of INTER RAO
UES;
•
Member of the Board of Directors of Holding of
the Inter-Regional Distribution Grid Companies;
•
Member of the Board of Directors of Gazprom;
•
Chairman of the Board of Directors of Transneſt
Oil Transporting Company;
•
Member of the Board of Directors of System
Operator of Unified Energy System.
* Member of the Board of Directors since 2008.
* Holds no shares in the Company.
Andrey Malyshev
Deputy Chairman
Born: 1958
Education: He graduated from the Moscow Power
Engineering University with a degree in Heat Power
Automation, as a heat power engineer. He holds a
PhD in Science, Sociology and Technical Sciences.
Holds the following positions:
•
Deputy CEO, Member of the Management
Board of the Russian State Nanotechnologies
Corporation.
* Member of the Board of Directors since 2008.
* Holds no shares in the Company.
Boris Ayuyev
Born: 1957
Education: He graduated from the Ural Polytechnic
Institute with a degree in Electric Power Plants in
1979 and holds a PhD in Technical Sciences.
Holds the following positions:
•
Chairman of the Management Board, Member
of the Board of Directors of System Operator –
Central Dispatch Control of the Unified Energy
System;
•
Member of the Board of Directors of Energy
Forecasting Agency;
•
Member of the Board of Directors of Administrator of the Trading System of the Wholesale
Electricity Market;
•
Member of the Board of Directors of Financial
Payment Center;
•
Chairman of the Not-for-Profit Partnership Russian National Committee of the International
Council on Large Electric Systems.
* Member of the Board of Directors since 2004.
* Share of participation in the Company’s share
capital: 0.0072209534%.
* Share of the Company’s ordinary stock:
0.0072209534%.
118
FEDERAL GRID COMPANY
Oleg Budargin
Born: 1960
Education: He graduated from the Lvov Polytechnic
Institute in 1961 with a degree in Electrical Engineering and has a PhD in Technical Sciences. He is also a
professor, with a PhD in Economics and is an honored
power industry worker of Russia.
Holds the following positions:
•
Advisor on the Power Sector to the President of
United Metallurgical Company;
•
Member of the Board of Directors of Energy
Forecasting Agency
* Member of the Board of Directors since 2010.
* Share of participation in the Company’s share
capital: 0.0000226124%.
* Share of the Company’s ordinary stock:
0.0000226124%.
Georgy Kutovoy
Born: 1937
Education: He graduated from the Lvov Polytechnic
Institute in 1961 with a degree in Electrical Engineering and has a PhD in Technical Sciences. He is also
a professor, with a PhD in Economics and is an honored power industry worker of Russia.
Holds the following positions:
•
Advisor on the Power Sector to the President
of United Metallurgical Company;
•
Professor of the Department for State Regulation of Natural Monopolies at the IPK Gossluzhbi
State Educational Institution;
•
Member of the Board of Directors of Holding
of Inter-Regional Distribution Grid Companies.
* Member of the Board of Directors since 2010.
* Holds no shares in the Company.
ANNUAL REPORT
2010
Alexey Makarov
Born: 1937
Education: He graduated from the Leningrad Polytechnic Institute and holds a PhD in Economics (1970)
and became a professor (1974); he is an expert on
system research for the power industry, the development of power sector policy and forecasts in the fuel
and power energy sector. He is also a member of the
Russian Academy of Sciences (RAS).
Holds the following positions:
•
Member of the RAS, Power Sector, Engineering, Mechanics and Management Processes
Department;
•
Director of the Energy Research Institute
of the RAS;
•
Independent Director of the Energy Forecasting Agency.
* Member of the Board of Directors since 2008.
* Holds no shares in the Company.
Dmitry Ponomarev
Born: 1967
Education: He graduated from the International
Law Department of the Moscow State Institute
of Foreign Affairs of the Ministry of Internal
Affairs and the Economic Department of the C.E.P. Paris
Institute for Political Science.
Holds the following posts:
•
Chairman of the Management Board of the
Non-Commercial Partnership "Market Council"
•
Chairman of the Management Board of Administrator of the Trading System of the Wholesale
Electricity Market;
•
Member of the Board of Directors of System
Operator of the Unified Energy System;
•
Member of the Board of Directors of Energy
Forecasting Agency;
•
Member of the Board of Directors of Lenenergo;
•
Member of the Board of Directors of Financial
Payment Center;
•
Chairman of the Board of Directors of Energorynok.
* Member of the Board of Directors since 2008.
* Holds no shares in the Company.
119
5.0
ABOUT THE COMPANY
PRODUCTION OVERVIEW
INVESTMENTS AND INNOVATIONS
ECONOMIC AND FINANCIAL PERFORMANCE
CORPORATE GOVERNANCE
SOCIAL RESPONSIBILITY
Yuri Soloviev
independent director
Born: 1970
Education: He graduated from the Plekhanov Russian
Academy of Economics in 1994. In 2002, he received
an MBA from the London Business School.
Holds the following positions:
•
President of VTB Capital, Head of the Investment
Business of the VTB Group;
•
Chairman of the Board of Directors of VTB Asset
Management;
•
Member of the Board of Directors of RAO Energy
Systems of the East;
•
Director General, Chairman of the Management
Board, Member of the Board of Directors of VTB
Capital IB Holding;
•
Director General, Chairman of the Management
Board, Member of the Board of Directors of VTB
Capital Holding;
•
Member of the Board of Directors of VTB Capital
Investment Management Holding AG.
Igor Khvalin
independent director
Born: 1974
Education: He graduated from the Moscow
Aviation Institute (the State Technical University)
and the Moscow State Pedagogical University,
with PhD in Sciences and History.
Holds the following positions:
•
General Director of Volga Engineering Group;
•
Member of the energy efficiency working group
of the Commission for the Modernization and
Technological Development of the Economy
attached to the Russian President;
•
Member of the Board of Directors of Holding
of Inter-Regional Distribution Grid Companies.
* Member of the Board of Directors since 2010.
* Holds no shares in the Company.
Ernesto Ferlenghi
independent director
Born: 1968
Education: He graduated from the Tor Vergata University of Rome (the Department of Mathematics, Physics and Natural Sciences) with a degree in Physics.
Holds the following positions:
•
Head of the Representative Office of Eni Russia
and the CIS;
•
Director General of Eni Energy, the Russian
Federation
Rashid Sharipov
independent director
Born: 1968
Education: He graduated from the Moscow State
University of Foreign Affairs in 1991, with a degree
in International Affairs and International Law. He also
holds an LL.M. degree from the California Western
- School of Law (1993).
Holds the following positions:
•
Deputy Director General of KFK-Consult;
•
Member of the Board of Directors of System
Operator of the Unified Energy System;
•
Member of the Supervisory Board of Russian
Regional Development Bank;
•
Member of the Board of Directors of Center for
Engineering and Construction Management of
the Unified Energy System.
* Member of the Board of Directors since 2008.
* Holds no shares in the Company.
* Member of the Board of Directors since 2008.
* Holds no shares in the Company.
* Member of the Board of Directors since 2010.
* Holds no shares in the Company.
120
FEDERAL GRID COMPANY
Deals Involving the Company’s Shares
Deals with the Company’s shares in 2010
•
Oleg Budargin
Deal date: 24 June, 2010
Shareholding in the Company’s share
capital prior to the acquisition: 0%
Shareholding in the Company’s share
capital aſter the acquisition: 0.0000226124 %.
Board of Directors’ Activities
In 2010 the Board of Directors held 27 meetings.
Of this number, two were held in the presence of
shareholders. The Board of Directors made a total
of 182 decisions, including approving the Company’s
long-term programs, such as energy savings and
the energy efficiency improvement program, the
2010-2014 investment program, the innovative development program, the insurance coverage program
and decisions that outline the main areas of the
Company’s operations:
•
•
•
•
•
•
On approving the list of measures necessary to
ensure the security of the Company’s sites in the
North Caucasus Region;
On acquiring a diesel power plant with equipment in the Republic of Karelia, Sortavala,
Valaam Island;
On discontinuing the Company’s participation
in: Tsentr Energetiki, Sibenergoholding, Intergeneration, and SOVASATOM;
On approving the new version of the Regulations
on the Procedure for the Regulated Procurement
of Products, Work and Services for Federal Grid
Company Needs;
On approving Regulations on the Dividend Policy;
On approving the new version of the Regulations
on Remuneration for Members of the Committees of Board of Directors.
ANNUAL REPORT
2010
Agenda Structure of 2010
Board of Directors Meetings
30/182
24/182
35/182
4/182
85/182
4/182
Defining the are as in the Company’s
operations
Related party transactions
Reports by the Management Board
Human Resources
Сurrent operations
Defining roles and positions
of the Company’s representative sin
managing bodies of SDCs
The Company publishes decisions of the Board of Directors
with Minutes' numbers and dates on its corporate web site:
http://www.fsk-ees.ru/shareholders_and_investors/corporate_
governance/decisions_of_the_board/.
121
5.0
ABOUT THE COMPANY
PRODUCTION OVERVIEW
INVESTMENTS AND INNOVATIONS
ECONOMIC AND FINANCIAL PERFORMANCE
CORPORATE GOVERNANCE
SOCIAL RESPONSIBILITY
5.3 COMMITTEES OF THE BOARD OF DIRECTORS
The Committees aim to improve the efficiency of the Board of Directors via
preliminary discussions of the most important questions that fall within the
competency of the Board of Directors, and by developing recommendations
on these questions.
In 2010 there were four committees attached
to the Board of Directors:
•
•
•
•
Strategy Committee;
Investment Committee;
Audit Committee;
HR and Remuneration Committee.
Operations for all these committees are governed
by respective Regulations on the Committees
outlining the composition, competencies, work
procedure and rights and responsibilities of the
Committees’ members.
Strategy Committee
The Committee’s functions include considering
and developing recommendations for the Board
of Directors on questions related to t he
development of the UES of Russia.
The Committee’s composition, as approved by a decision of the Company's Board of Directors,
as of 22 September, 2010 (positions held at the time of election):
Alexey Makarov
Chairman , Member of the Board of Directors of Federal Grid
Company, Director of RAS’ Energy Research Institute
Nikolay Shulginov
First Deputy Chairman of the Management Board of SO UES
Roman Berdnikov
Deputy Chairman of the Company’s Management Board
Alexander Bobrov
First Deputy Chairman of the Company’s Management Board
Anatoly Dyakov
President of the Not-for-Profit Partnership Scientific and Technical Council of UES
Igor Kozhukhovsky
Director General of APBE
Victor Kudryavy
Advisor to the President of Eurocement Group
Yuri Lipatov
Chairman of the Power Energy Committee
of the State Duma of the Russian Federation
Valentin Mezhevich
First Deputy Chairman of the Commission on Natural Monopolies
for the Federation Council of the Russian Federal Duma
Vladimir Sitnikov
General Director of Institute Energosetproekt
Vladimir Fortov
Member of the Presidium of the RAS
Oleg Dunin
Deputy Director of the Department of Electric Power Industry
Development at the Russian Ministry of Energy
122
FEDERAL GRID COMPANY
ANNUAL REPORT
2010
The Committee’s 2010 operations
In 2010 the Committee held five meetings, of these
three were conducted in the presence of shareholders. The meetings approved the following recommendations of the Board of Directors:
•
On the creation of the Committee on Implementing Current and Promising Innovative Projects,
attached to the Chairman of the Management
Board;
•
On the implementation of the project entitled
The Development of Russia’s Smart Energy System Based on Active Adaptive Network Principles, which involves IDGC Holding
•
On the approval of the organizational structure
for the executive office of the Company;
•
On the approval of the Company Innovative Development Program.
Investment Committee
The Committee’s functions include considering and
developing recommendations for the Board of Directors on questions related to the corporate investment
policy and informing the Board of Directors about
risks associated with investment activities.
The Committee’s 2010 operations
In 2010 the Committee held ten meetings, of this
number four were held in the presence of shareholders. The meetings approved the following recommendations for the Board of Directors:
•
On the approval of the Company 2010-2014
Investment Program;
•
On the approval of the Company 2010 business
plan;
•
On the consideration of target figures for
2011-2012 business plan;
The Committee’s composition, as approved by a decision of the Company's Board of Directors,
as of 22 September, 2010 (positions held at the time of election):
Andrey Malyshev
Chairman, Member of the Company's Board
of Directors, Deputy CEO of the Russian State
Nanotechnologies Corporation
Alexander Ilyenko
Director of the UES Asset Management for SO UES
Roman Berdnikov
Deputy Chairman of the Company’s Management Board
Alexander Bobrov
First Deputy Chairman of the Company’s Management Board
Vladimir Mayorov
General Director of ECMC UES
Victor Lebedev
Deputy Department Head at the Russian Ministry of Economic Development
Alexey Makarov
Member of the Company’s Board of Directors,
Director of the Energy Research Institute of the RAS
Vasily Nikonov
Director of the Department of Electric Power Industry
Development for the Russian Ministry of Energy
Vladimir Fortov
Member of the Presidium of the Russian Academy of Sciences
Yuri Soloviev
Member of the Company’s Board of Directors, President of VTB Capital
Igor Khvalin
Member of the Company’s Board of Directors,
General Director of Volga Engineering Group
Sergey Serebryannikov
Rector of the State Educational Institute
of Higher Professional Education MPEI (TU)
Maria Tikhonova
Director of the Department of Economic Regulation and Property
Relations in the Fuel and Energy Complex of the Russian Ministry of Energy
123
5.0
ABOUT THE COMPANY
PRODUCTION OVERVIEW
INVESTMENTS AND INNOVATIONS
ECONOMIC AND FINANCIAL PERFORMANCE
CORPORATE GOVERNANCE
SOCIAL RESPONSIBILITY
•
On the approval of the new version of Regulations
on the Dividend Policy;
On the approval of the new version of Regulations
on the Dividend Policy;
•
Audit Committee
The Committee’s functions include developing recommendations for the Board of Directors on selecting
an independent audit company and on improving the
Company’s reporting systems and internal control.
The Committee’s 2010 operations
In 2010 the Committee held six meetings, of this
number two were held in the presence of shareholders.
Among other decisions, the meetings approved 2011
Insurance Coverage Program and the Regulations
The Committee’s composition, as approved by a decision of the Company's Board of Directors,
as of 22 September, 2010 (positions held at the time of election):
Rashid Sharipov
Chairman, Member of the Company's Board of Directors,
Deputy General Director of KFK-Consult
Igor Khvalin
Member of the Company's Board of Directors,
General Director of Volga Engineering Group
Ernesto Ferlenghi
Member of the Company's Board of Directors,
Head of the Representative Office of Eni Russia and the CIS
on Liability Insurance for members of the Board of
Directors, members of the Management Board, the
Chief Accountant and officers.
HR and Remuneration Committee
The Committee’s functions include developing recommendations for the Board of Directors on aspects
of the remuneration system and cash incentives
for top corporate executives and the Internal Audit
Commission, and defining candidate selection criteria
for the Company’s management bodies.
The Committee’s 2010 operations
In 2010 the HR and Remuneration Committee held
four meetings, of this number three were held in the
presence of shareholders and one was held in absentia. The following decisions were made at these
meetings:
The Committee’s composition, as approved by a decision of the Company's Board of Directors,
as of 22 September, 2010 (positions held at the time of election):
Dmitry Ponomarev
Chairman, Member of the Company's Board of Directors,
Chairman of the Management Board of the Market Council
Yuri Soloviev
Member of the Company's Board of Directors,
President of VTB Capital
Rashid Sharipov
Member of the Company's Board of Directors,
Deputy General Director of KFK-Consult
•
•
124
To approve principles and criteria for remuneration and cash rewards to members of the Company’s Management Board and the Chairman of
the Management Board;
To approve the Methods of Calculating and
Evaluating Key Performance Indicators (KPIs)
Achieved by the Company’s Managers;
•
To provide recommendations on upgrading
Regulations on the Stock Option, considering
comments made during the Committee’s meeting.
FEDERAL GRID COMPANY
ANNUAL REPORT
2010
Participation of Directors in 2010 Meetings
of the Board of Directors and Its Committees
Committees
Board of Directors
Name
Executive
Independent *
Participation in
meetings **
Audit
Committee
Strategy
Committee
HR and
Remuneration
Committee
Invest
ment
Committee
Boris Ayuyev
No
27/27
-
2/5
-
5/5
Oleg Budargin
Yes
13/13
-
-
-
-
Evgeny Dod²
No
10/14
-
-
-
-
Mikhail Kurbatov²
No
5/14
-
-
-
-
Georgy Kutovoy
No
9/13
-
-
-
-
Alexey Makarov
No
20/27
-
5/5
-
4/5
Andrey Malyshev
No
26/27
-
1/5
-
10/10
Sergey Maslov²
No
14/14
-
-
-
5/5
Dmitry Ponomarev
No
25/27
-
-
4/4
2/5
Yuri Solovyev
No
Х
13/13
0/2
-
2/2
4/5
Vladimir Tatsiy²
No
Х
14/14
3/6
-
2/2
5/5
Rashid Sharipov
No
Х
20/27
6/6
-
4/4
-
Sergey Shmatko
No
27/27
-
-
-
-
Igor Khvalin
No
Х
13/13
1/1
-
-
4/5
Ernesto Ferlenghi
No
Х
25/27
4/6
-
-
-
1
Was not a member of the Board of Directors prior to the AGM
2
Was a member of the Board of Directors only prior to the AGM
X
* It is advised that members of the Board of Directors meet the following requirements to be deemed independent:
(1) During the last three years were not and are not offi cers (managers) or employees of the Company or offi cers or employees of the Company’s
management organization;
(2) Are not officers of another company in which any of the Company’s officers are a member of the HR and Remuneration Committee;
(3) Are not affiliated persons to an officer (manager) of the Company (or an officer of the Company’s management organization);
(4) Are not affiliated persons of the Company or affiliated persons of said affiliated persons;
(5) Are not involved in obligations with the Company that enable them to acquire property (obtain monetary funds), the cost of which is equal to 10 and
more percent of the total annual income of said persons, other than for director compensation;
(6) Are not a large contractor for the Company (a contractor that has the total number of deals with the Company throughout the year exceeding 10 and
more percent of the balance sheet value of the Company’s assets);
(7) Are not representatives of the state.
An independent director who has served on the Company’s Management Board for a period of seven years can no longer be viewed as independent (Russian
FCSM's Resolution “On Recommendations on the Use of the Corporate Governance Code” No. 421/r dated 04.04.2002 (together with the Corporate
Governance Code dated 05.04.2002)
** The first figure shows the number of meetings that the member of the Board of Directors participated in and the second one shows the number of
meetings which he/she could potentially have participated in (likewise for Committees).
125
5.0
ABOUT THE COMPANY
PRODUCTION OVERVIEW
INVESTMENTS AND INNOVATIONS
ECONOMIC AND FINANCIAL PERFORMANCE
CORPORATE GOVERNANCE
SOCIAL RESPONSIBILITY
MANAGEMENT BOARD
1 Oleg Budargin
Chairman of the Management Board,
member of the Board of Directors
[ 1]
126
FEDERAL GRID COMPANY
ANNUAL REPORT
2010
[2]
[3]
[4]
[5]
[6]
[7]
[8]
[9]
[10]
[11]
2 Alexander Bobrov
3 Dmitry Troshenkov
4 Valery Chistyakov
5 Roman Berdnikov
6 Dmitry Gvozdev
First Deputy Chairman
of the Management Board
First Deputy Chairman
of the Management Board
First Deputy Chairman
of the Management Board
Deputy Chairman
of the Management Board
Deputy Chairman
of the Management Board,
Chief Engineer
7 Andrey Kazachenkov
8 Yuri Mangarov
9 Dmitry Gurevich
10 Evgeny Zhuikov
11 Pavel Romanov
Deputy Chairman
of the Management Board
Deputy Chairman
of the Management Board
Member of the Management Board,
Telecommunications and IT Director
Member of the Management Board,
General Director of MES Volga
Member of the Management Board
127
5.0
ABOUT THE COMPANY
PRODUCTION OVERVIEW
INVESTMENTS AND INNOVATIONS
ECONOMIC AND FINANCIAL PERFORMANCE
CORPORATE GOVERNANCE
SOCIAL RESPONSIBILITY
5.4 MANAGEMENT BOARD
Management of Federal Grid Company’s day-to-day operations
is performed by the Chairman of the Management Board and
the Management Board, which are accountable to the General
Shareholders Meeting and the Company’s Board of Directors.
The Management Board acts in accordance with the
Russian Federal Law No. 208-FZ dated 26 December,
1995, Russian legislation and the Company’s internal
documents: the Articles of Association, the Code of
Corporate Governance and Regulations on the Management Board.
The Chairman of the Management Board is the sole
executive management body and is responsible for
developing the Company’s strategies and targets
in economic and financial aspects, accounting and
reporting, production and commercial operations,
human resources, R&D and investment and corporate
policy; to ensure security, legal and administrative
support for operations.
In 2010 the following changes were made in the
composition of the Management Board:
•
•
•
•
On 12 May, 2010, the Board of Directors made a
decision to terminate the powers of the following members of the Management Board: Alexey
Maslov and Mikhail Tuzov, and elected Pavel
Romanov and Dmitry Gvozdev to be members
of the Board;
Starting 4 April, 2010, the powers of Management Board member Andrey Demin were terminated, due to the expiration of his fixed-term
employment agreement;
Due to his death, a member of the Management
Board, Victor Vasilyev, was removed from the
Board 7 March, 2010;
The decision of the Board of Directors, dated
7 September, 2010, terminated the powers of the
following members of the Management Board:
Sergey Ivanov and Misrikhan Misrikhanov;
128
•
The decision of the Board of Directors, dated
7 September, 2010, appointed Andrey
Ka zachenkov, Yuri Mangarov, Alexander
Bobrov and Evgeny Zhuykov members of
the Company’s Management Board.
The Chairman of the Management
Board is the sole executive management
body and is responsible for developing
the Company’s strategies and targets in
economic and financial aspects, accounting
and reporting, production and commercial
operations, human resources, R&D and
investment and corporate policy; to ensure
security, legal and administrative support
for operations.
FEDERAL GRID COMPANY
Chairman of the Management Board
Oleg Budargin
Responsibilities:
The Chairman of the Management Board is responsible for developing the Company’s strategies and
targets in economic and financial aspects, accounting
and reporting, production and commercial operations, human resources, R&D and investment and
corporate policy; thus ensuring security, legal and
administrative support for operations. Elected at
the Company’s Extraordinary General Shareholders
Meeting on 27 October, 2009.
Background:
Mr. Budargin was born 16 November, 1960 and
graduated from the Norilsk Industrial Institute
(cum laude) in 1982 with a degree in Industrial and
Civil Engineering. From 1984-1995 he worked at
Norilskstroi PSMO (Production Construction and
Assembly Association), in Promstroi Trust of the
Norilsk Mining and Metallurgical Work (NGMK), in
the Capital Construction Department of NGMK and
served as Deputy CEO of NGMK. Mr. Budargin
was Mayor of Norilsk from 2000–2002 and
Governor of the Taimyr (Dolgano-Nenetsky)
Autonomous Dist ric t from 20 03 –20 0 6 .
In 2007 he was appointed Assistant to the
Plenipotentiary Representative of the Russian
President in the Siberian Federal District. On 11 July,
2009, Federal Grid Company’s Board of Directors
appointed Mr. Budargin Acting Chairman of the
Management Board, and on 27 October, 2009,
he was elected Chairman of Federal Grid Company’s
Management Board by an Extraordinary General
Shareholders Meeting.
ANNUAL REPORT
2010
* Share of participation in the Company’s share
capital: 0.0000226124%.
* Share of the Company’s ordinary stock:
0.0000226124%.
The Composition of the Management Board,
valid since 7 September, 2010
Alexander Bobrov
Responsibilities:
Managing Federal Grid Company’s investment operations and property and providing logistics and procurement support for the Company.
Background:
Mr. Bobrov was born 16 June, 1968. In 1998, he
graduated from the North-West Public Service
Academy with a degree in Public and Municipal
Management. He holds a PhD in Economics.
From 1997-2003, Mr. Bobrov was Head of the
External Economic Relations and Investment
Policy Department at Lentransgaz and Deputy
General Director of Petersburgregiongaz. From
2003-2008 he served as the Chairman of the
Saint-Petersburg Energy and Engineering Support
Committee. He was Head of Inzhspetsstroy, a
Noncommercial Partnership for Promoting
Construction Work Quality and Safety, which
unites major Saint Petersburg-based companies
involved in infrastructural engineering and
redevelopment. 2010, Mr. Bobrov was appointed
Chief Advisor to the Chairman of the Company’s
Management Board, and st 2010, he was appointed First Deputy Chairman of the Management
Board. In September 2010, Mr. Bobrov was
elected a member of the Company’s Management
Board.
Holds the following positions:
Holds the following positions:
•
•
Chairman of the Management Board, Member
of the Board of Directors of Federal Grid
Company;
Member of the Board of Directors of Energy
Forecasting Agency.
•
•
First Deputy Chairman of the Management
Board, Member of the Management Board
of Federal Grid Company;
President of the Non-Commercial Partner-
129
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ABOUT THE COMPANY
PRODUCTION OVERVIEW
INVESTMENTS AND INNOVATIONS
ECONOMIC AND FINANCIAL PERFORMANCE
CORPORATE GOVERNANCE
SOCIAL RESPONSIBILITY
ship for Quality and Safety Improvement in
Construction “The Self-Regulation Organization
Inzhspetsstroy-Elektroset.”
•
•
* Mr. Bobrov holds no shares in the Company.
•
Dmitry Troshenkov
•
Responsibilities:
Managing the Company’s economic and financial
operation and financial efficiency measures, implementing the corporate policy and legal framework
and human resources management.
Background:
Mr. Troshenkov was born 7 January, 1966. He
graduated from the Economics Department of the
St. Petersburg State University with a degree
in Financial Accounting and Auditing. He also
holds a degree in bank financial accounting and
auditing from the Saint Petersburg Banking Institute.
From 2000–2001 he served as Deputy CEO (for
economics and finance) at Petroelektrosbyt. From
2001–2005 he as Deputy CEO (for economics
and finance) at Lenenergo and later was
the Deputy CEO (for economics and finance)
at WGC-1 (2005–2006). Between 2006 and
September 2009 he was the Vice President for
Finance at TNK-BP. In September 2009, he was
appointed First Deputy Chairman of Federal
Grid Company. Mr. Troshenkov has been a Member
of the Company’s Management Board since
October 2009.
Mr. Troshenkov holds the following positions:
•
•
•
First Deputy Chairman of the Management
Board, Member of the Management Board
of Federal Grid Company;
Member of the Board of Directors of First Power
Generating Company of the Wholesale Electricity Market;
Member of the Board of Directors of Sixth Power
Generating Company of the Wholesale Electricity Market;
130
•
Member of the Board of Directors of the Bashkir
Joint Stock Company of the Power Industry and
Electrification Bashkirenergo;
Member of the Board of Directors of Territorial
Generating Company No. 6 (TGC-6);
Member of the Board of Directors of Territorial
Generating Company No. 11 (TGK-11);
Member of the Board of Directors of Volga
Territorial Generating Company;
Member of the Board of Directors of Index
of Energy – Federal Grid Company.
* Mr. Troshenkov holds no shares in the Company.
Valery Chistyakov
Responsibilities:
Management of the Company’s R&D activities
and technologies, customer development and
relations, telecommunications and IT management,
organization of technical maintenance and repairs
for the Unified Energy System.
Background:
Mr. Chistyakov was born 18 May, 1955. In 1977 he
graduated from the Vladimir Polytechnic Institute
with a degree in Mechanical Engineering, and from
the Financial Academy of the Russian Government in
1996 with an Economics degree. In 2003 he took an
MBA course in Business Management at the State
Management University. Mr. Chistyakov holds a PhD
in Economics. From 1999–2009 he held various
positions in the power sector, including Deputy CEO
for Sales at Vladimirenergo, CEO of Udmurtenergo,
Director of the Upper Volga Branch of IDGC Center
and North Caucasus, CEO of Lenenergo and First
Deputy CEO of UES Engineering Center. In September 2009, he was appointed Deputy Chairman of
the Company’s Management Board and was elected
as a member of the Company’s Management Board
in October 2009. Mr. Chistyakov has served as
First Deputy Chairman of Management Board since
November 2009.
FEDERAL GRID COMPANY
ANNUAL REPORT
2010
Holds the following positions:
Holds the following positions:
•
•
•
First Deputy Chairman of the Management
Board, Member of the Management Board of
Federal Grid Company;
Member of the Board of Directors of the Bashkir
Joint Stock Company of the Power Industry and
Electrification Bashkirenergo.
•
•
Deputy Chairman of the Management Board,
Member of the Management Board of Federal
Grid Company;
Member of the Board of Directors of Unified
Energy System GruzRosenergo;
Member of the Board of Directors of Energy
Institute named aſter Krzhizhanovsky.
* Mr. Chistyakov holds no shares in the Company.
Roman Berdnikov
Responsibilities:
Customer relations and development, R&D development and management of the Company’s technologies and the corporate R&D policy.
Background:
Mr. Berdnikov was born 14 August, 1973 and graduated from the Moscow Power Engineering Institute
(1998) with a degree in Electric Power Plants. From
1997 to 1998 he worked as the chief electrician
at Mosenergo. From 1998 to 1999 he worked in
the Tariffs and Technical and Economic Indicators
Department of SO CDU UES of Russia. From 1999 to
2002 Mr. Berdnikov worked with RAO UES of Russia,
where he began as a specialist in the Department of
the SDC Federal National Wholesale Electric Power
Market and was eventually promoted to the post of
leading specialist in the Department of Electric Power
Market Development. In October 2002, he joined the
Company as the chief specialist in the Strategic Planning Department. In 2003 he was appointed Deputy
Head of the Strategic Planning Department; in 2005
he took over the position of Head of the Department of Service and Grid Reliability Improvement,
which was later restructured as the Department of
Customer and Market Relations. In 2009 he took up
the post of Development and Customer Relations
Director. Mr. Berdnikov was elected a Member of the
Company’s Management Board in October 2009.
Since February 2010 he has been Deputy Chairman
of the Management Board.
* Share of participation in the Company’s sharecapital: 0.0000001975%.
* Share of the Company’s ordinary stock:
0.0000001975%.
Dmitry Gvozdev
Responsibilities:
Organizing maintenance and repair activities, implementing the Company’s technical policy, organizing
site maintenance for the UNEG, organizing workplace
safety management systems at the UNEG sites and
managing labor safety efforts.
Background:
Mr. Gvozdev was born 13 August, 1974 and graduated
from Kuzbass State Technical University with a
cum laude degree in Electrical Engineering. In 2000
he received a Ph.D. in Technical Sciences from the
same university. He started his career at Kemerovskaya GRES (State District Power Plant) – a branch of
Kuzbassenergo. Upon completing his post-graduate studies, he worked with ODU of Siberia, a SO
UES branch, where he was promoted from engineer
to Deputy Chief Dispatcher. Following this, he was
Director for Dispatch Control Technology Development at the SO UES branch – ODU of the Center.
In March 2009, he was appointed the Company’s
Asset Management Director. Since September 2009
he has been Chief Engineer for the Company and
since May 2010 he has been a Member of the Management Board.
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ABOUT THE COMPANY
PRODUCTION OVERVIEW
INVESTMENTS AND INNOVATIONS
ECONOMIC AND FINANCIAL PERFORMANCE
CORPORATE GOVERNANCE
SOCIAL RESPONSIBILITY
Holds the following positions:
•
Deputy Chairman of the Management Board –
Chief Engineer, Member of Federal Grid
Company’s Management Board.
•
Member of the Board of Directors of Index of
Energy – Federal Grid Company.
* Mr. Gvozdev holds no shares in the Company.
* Share of participation in the Company’s share
capital: 0.0000191091%.
* Share of the Company’s ordinary stock:
0.0000191091%.
Andrey Kazachenkov
Yuri Mangarov
Responsibilities:
Management of the Company’s financial and
economic activities, organization of the Company’s
economic, financial and accounting processes.
Responsibilities:
Control and audit operations management, corporate economic security, supervision over the Company
and its SDCs’ financial, production and administrative operations.
Background:
Mr. Kazachenkov was born 24 April, 1980. He graduated cum laude from the St Petersburg State Engineering and Economic University with a degree in
Engineering Plant Economics and Governance and
in Management. He obtained an MBA from the
University of Wisconsin (Madison, USA) and was
trained at IMD (Switzerland) and INSEAD (France)
Business Schools under the auspices of special
programs in Economics and Finance. He started
his career in 2004 with Lenenergo as an Advisor
to the Finance Director, and was later appointed Deputy Finance Director. In 2005 Mr. Kazachenkov joined
WGC-1 as Head of the Corporate Finance Department. Since October 2009 he has been an Advisor to
the Chairman of the Company’s Management Board.
Since November 2009 Mr. Kazachenkov has been
Deputy Chairman of the Company’s Management
Board. Mr. Kazachenkov was elected a Member of
Management Board in September 2010.
Holds the following positions:
•
•
Deputy Chairman of the Management Board,
Member of the Management Board of Federal
Grid Company;
Member of the Board of Directors of Volga
Territorial Generating Company;
132
Background:
Mr. Mangarov was born 6 November, 1956 and
graduated from the Plekhanov Moscow Institute
of the National Economy with a degree in
Economic Cybernetics. For 23 ears, from 1980
to 2003, he worked in the mining and metals
industry. He started his career as an engineer
with the Norilsk Mining and Metallurgical
Work and became Director of Norilsk Integrated
Plant. In 2003 Mr. Mangarov was appointed
Deputy Human Resources and Social Policy
Director with Mining and Metallurgical Company
Norilsk Nickel; and later held the offices of
Deput y Employee Relations and Salar y
Director and the Head of the Director Division.
In August 2009, he joined the Company as
the Deputy Head of the Financial Control
and Internal Audit Division. In October 2009,
Mr. Mangarov was appointed Director for
Control and Audit Operations. Since March
2010 he has been Deputy Chairman of the
Management Board. In September 2010,
Mr. Mangarov was elected as a Member of the
Management Board.
FEDERAL GRID COMPANY
Holds the following positions:
•
•
•
Chairman of the Management Board,
Member of the Management Board of Federal
Grid Company;
Member of the Board of Directors of
Energostroysnabkomplekt of the UES;
Member of the Board of Directors of Center
for Engineering and Construction Management
of the Unified Energy System.
ANNUAL REPORT
2010
Telecommunications and IT Director. In October
2009, Mr. Gurevich was elected a Member of the
Company’s Management Board.
Holds the following positions:
•
Telecommunications and IT Director, Member
of the Management Board.
* Mr. Gurevich holds no shares in the Company.
Evgeny Zhuikov
* Mr. Mangarov holds no shares in the Company.
Dmitry Gurevich
Responsibilities:
Telecommunications and IT, development and implementation of the UEP TN of the Electricity Grid
and coordination of fiber optic line construction.
Background:
Mr. Gurevich was born 22 July, 1971 and graduated
from the Leningrad Electro-Technical Institute
named aſter Bonch-Bruyevitch in 1993 with a degree
in Radio Engineering. In 1997 he obtained an MBA
from the St Petersburg International Institute of
Management (IMISP) and a Masters Certificate from
D. Washington University in Project Management.
Aſter graduating from the Institute, he jointed
AT&T (Lucent Technologies). In 1997 Mr. Gurevich was
appointed Project Director of Lucent Technologies.
In 2003 he joined Rostelecom, where he became
Project Management Director and Deputy General
Director and a Member of the Management Board.
In Febr uar y 20 0 8 , he wa s appointed
Telecommunications Director of the Company;
in October 2009, Mr. Gurevich was appointed
Responsibilities:
General Director of the Company MES of Volga
branch.
Background:
Mr. Zhuykov was born 13 May, 1961. In 1990 he
graduated from the Sverdlovsk Institute of the
National Economy as an economist, with a degree in
Economics and Logistics Planning. He is a graduate
of the Presidential Program for Executive Staff
Training for National Economy Enterprises specializing in Finance and Lending (2000). Mr. Zhuykov
holds a PhD in Economics. For 13 years he
worked for Western Electric Grids POEiE Sverdlovenergo: from 1987 to 1990 he was Head of the
Procurements Department and in 1990-2000 he
served as the Deputy Director. From 2001-2002
he was Head of Logistics at Uralplastic (Yekaterinburg). In 2002 he was appointed Deputy
General Director for Economics and Finance and
acting General Director of MES of Ural. In August
2010, Mr. Zhuykov was appointed General Director of MES of Volga. Since September 2010 he has
served as a Member of the Company’s Management
Board.
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PRODUCTION OVERVIEW
INVESTMENTS AND INNOVATIONS
ECONOMIC AND FINANCIAL PERFORMANCE
CORPORATE GOVERNANCE
SOCIAL RESPONSIBILITY
Holds the following positions:
Holds the following positions:
•
•
General Director of MES of Volga branch, Member of the Management Board of Federal Grid
Company.
•
Member of the Management Board of Federal
Grid Company;
Member of the Management Board of Volga
Territorial Generating Company;
Member of the Board of Directors of the Unified
Energy System GruzRosenergo.
* Share of participation in the Company’s share
capital: 0.0000001609%.
* Share of the Company’s ordinary stock:
0.0000001609%.
•
Pavel Romanov
Deals involving the Company’s shares
Deals with the Company’s shares in 2010:
Responsibilities:
Managing the Company’s property, financial risks,
invested capital and procurement. Organizing the
management process for subsidiary and dependent
companies.
Background:
Mr. Romanov was born 7 July, 1964 and graduated
from the Moscow State University in 1986, with
a cum laude degree in Economics. From 1986 to
1993 he worked at Moscow State University as the
Secretary of the Komsomol Committee, as an assistant to the Chair of Production Management in the
Economics Department at Moscow State University.
From 1993 to 1994 Mr. Romanov was the Economic
and Finance Director of Vityaz Precision Engineering
Concern. From 1994 to 2002 he was General Director
of FNDS, a professional stock market operator. From
2002 to 2007 he worked as Finance Director of the
Rosenergoatom Corporation. From 2007 to 2008
he was First Deputy General Director of Atomenergoproekt. From 2008 to 2009 he was the General
Director of Engineering Center ‘Russian Gas Centrifuge’. Between December 2009 and January 2011
he served as the Deputy Chairman of the Company’s
Management Board. Since May 2010 he has been a
Member of the Company’s Management Board.
134
* Mr. Romanov holds no shares in the Company.
•
A. Kazachenkov
Deal date: 20 September, 2010
Shareholding in the Company’s share capital
prior to the acquisition: 0%
Shareholding in Company’s share capital aſter
the acquisition: 0.0000191091%.
FEDERAL GRID COMPANY
ANNUAL REPORT
2010
5.5 REMUNERATION TO THE MANAGEMENT BODIES
Remuneration to the Board of Directors
Remuneration to members of the Board of Directors
is based on the Regulations on Compensation and Remuneration to Members of the Board of Directors.
place for serving as the Chairman and taking part in
Committees of the Board of Directors. Total remuneration, including benefits, cannot exceed RUR
900,000.
Remuneration paid to each member of the Board of
Directors is based on the total number of meetings
of the Board of Directors during the past corporate year, the number of meetings that the member
of the Board of Directors participated in and the
Company’s revenues for the financial year. In addition to remuneration, the Company has benefits in
Remuneration is not paid to members of the Board
of Directors who are subject to any legislative limitations or prohibitions on receiving any payments from
commercial organizations, or to members of the
Board of Directors who at the same time serve as
either the Chairman or members of the Company’s
Management Board.
Name
Remuneration for participating
in a Board of Directors’ meeting, RUR
Other personal compensation, insurance premium under the VPLI *, RUR
Total, RUR
Sergey Shmatko
0
0
0
Mikhail Kurbatov
38,822.72
0
38,822.72
Oleg Budargin
0
0
0
Georgy Kutovoy
0
0
0
Yuri Soloviev
0
0
0
Igor Khvalin
0
0
0
Andrey Malyshev
165,687.00
123,215.93
288,902.93
Alexey Makarov
141,369.00
123,215.93
264,584.93
Sergey Maslov
177,288.00
123,215.93
300,503.93
Ernesto Ferlenghi
153,342.00
123,215.93
276,557.93
Vladimir Tatsiy
105,450.00
101,863.43
300,503.93
Rashid Sharipov
154,086.00
123,215.93
277,301.83
Boris Ayuyev
177,288.00
123,215.93
300,503.93
Evgeny Dod
129,768.00
162,038.65
291,806.65
Dmitry Ponomarev
165,315.00
123,215.93
288,530.93
1,408.415.72
1,126,413.59
2,628,019.71
Total
*Voluntary personal individual liability
135
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ABOUT THE COMPANY
PRODUCTION OVERVIEW
INVESTMENTS AND INNOVATIONS
ECONOMIC AND FINANCIAL PERFORMANCE
CORPORATE GOVERNANCE
SOCIAL RESPONSIBILITY
Remuneration to the Management Board
Federal Grid Company has a unified well-balanced
employee remuneration and motivation system which
differentiates between employee position categories
and the performance of the Company, its structural
departments and employees. The motivation system
directly depends on the performance achieved by the
Company and its employees (in accordance with key
performance indicators (KPIs)) and is based on the
Company’s long-term objectives.
Remuneration paid to the Chairman and members of
the Management Board are based on the Company
achieving key performance indicators. Respective
key performance indicators, their calculation methods and target levels are approved by the Board of
Directors.
2010 total compensation paid to members
of the Management Board (RUR)
175 756.541
including:
Salary (RUR)
Bonuses (RUR)
109,375.902
63,797.110
Commission (RUR)
none
Benefits (RUR)
none
Other personal compensation (RUR)
(Voluntary personal liability insurance)
2,583.529
Information on Remuneration, Benefits and Expenses
Paid to Members of Federal Grid Company’s Management Board:
In 2010 the following KPIs for top executives were
used:
Half-year indicators:
•
•
•
Relative share of restrictions and limitations on
electricity transmission services, %;
No workplace incidents with fatalities and no
incidents that injured several people, with at
least one of them gravely injured;
Meeting the target current liquidity limit.
2010 total compensation paid to members
of the Management Board (RUR)
19,434.570
including:
Salary (RUR)
Bonuses (RUR)
11,083.467
7,781.653
Commission (RUR)
none
Annual indicators:
Benefits (RUR)
none
•
•
•
Other personal compensation (RUR)
(Voluntary personal liability insurance)
•
•
EBITDA;
No major accidents;
Losses in electricity transmission in the grid used
by Federal Grid Company for providing electricity
transmission services, %;
Ratio of new production capacity launch, %;
Ratio of capital investment utilization, %.
The Company met approved KPIs for 1H, 2H
and FY 2010.
136
569.450
Information on remuneration paid to members of the
Company’s Board of Directors and the Management
Board, as of the end of the financial reporting year, is
disclosed in the Company's 1Q report. The Company’s
quarterly reports are also disclosed on the official web
site of Federal Grid Company.
FEDERAL GRID COMPANY
ANNUAL REPORT
2010
5.6 INTERNAL CONTROL SYSTEM
The Company’s existing internal control system over its financial
and administrative activities is aimed at ensuring investors trust
in the Company and its management bodies.
Objective: to identify and reduce the risk of situations
that negatively impact the Company’s ability to
achieve its aims and results in losses, to ensure
protection for the Company’s assets, to effectively
utilize available resources and to ensure compliance
with Russian legislation and decisions made by
management bodies and the Company’s internal
documents.
The internal control system is based on the
Regulations on the Internal Control System of Federal
Grid Company, approved by a decision of the Board
of Directors, which was made 28 February, 2008
(Minutes No. 55).
Participants in the Internal Control System
Audit Commission
Board of Directors
Audit Committee of
the Board of Directors
Chairman of the
Management Board
The Company’s
internal subdivisions
The Control and Audit
Department;
The Technical Oversight
and Audit Department;
The Internal Control
Division
The Audit Commission
The Audit Commission is elected annually by the
General Shareholders Meeting and consists of five
members. Its scope of responsibility includes:
•
•
•
Ensuring the reliability of data contained in the
Company’s annual report, accounting balance
sheet and profit and loss statement;
Analyzing the Company’s financial state, identifying opportunities for financial upgrades and
developing recommendations for management
bodies;
Organizing and conducting probes (audits)
for the Company’s financial and administrativeactivities.
The Audit Commission acts in accordance with
the Federal Law “On Joint Stock Companies,”
Russian legislation and the Company’s internal documents: the Articles of Association, Code
of Corporate Governance and Regulations on the
Audit Commission.
In 2010 the Company had two different convocations of the Audit Commissions (one in 2009 and one
in 2010).
137
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ABOUT THE COMPANY
PRODUCTION OVERVIEW
INVESTMENTS AND INNOVATIONS
ECONOMIC AND FINANCIAL PERFORMANCE
CORPORATE GOVERNANCE
SOCIAL RESPONSIBILITY
The Audit Commission elected by the Annual General Shareholders
Meeting on 30 June, 2009, was dissolved 29 June, 2010.
Name
Primary position held
Tatiana Zlydareva
Consultant, Federal Agency for State Property
Management
Victor Lebedev
Head of the State Tariff Regulation and Infrastructure
Reform Department of the Ministry of Economic
Development
Dmitry Kozlov
Deputy Department Head, Ministry of Energy
Evgeny Krylov
Head of the Management Department, Federal Agency
for State Property Management
Maria Tikhonova
Chief of the Department of Economic Regulation and
Property Relations in the Fuel and Energy Complex of
the Russian Ministry of Energy
On 29 June, 2010, the Annual General Shareholders
Meeting elected new members of the Company’s
Audit Commission, including (positions held at the
time of election):
Name
Primary position held
Vladimir Raspopov
Chairman
Head of IT, Department for Financial andmLogistical
Support and Government Contracts at the Federal
Agency for State Property Management
Anna Drokova
Secretary
Chief Specialist, Expert on Fuel, Power Energy and
Coal Industry in the Department for Infrastructural
Industries and Military Industry of the Federal
Agency for State Property Management
Maria Tikhonova
Director of the Department of Economic Regulation
and Property Relations in the Fuel and Energy
Complex of the Russian Ministry of Energy
Dmitry Gorevoy
Leading Specialist, Expert in the Department for Electricity
Sector Development of the Ministry of Economic Development
Andrey Kolyada
Head Specialist, Expert of the Management Department,
Federal Agency for State Property Management
138
FEDERAL GRID COMPANY
ANNUAL REPORT
2010
Members of the Audit Commission hold no shares in
the Company.
The Company’s internal control departments:
Internal Control Sub-Divisions
Remuneration to members of the Audit Commission
is paid based on the Regulations on Compensation
and Remuneration to Members of the Audit Commission, as approved by Federal Grid Company’s General
Shareholders Meeting (dated 30 June, 2008). In 2010
no remuneration was paid to members of the Audit
Commission due to the fact that all members of the
Audit Commission are public servants.
Control and Audit Department
Board of Directors
The Board of Director’s areas of competency within
the internal control system involve:
•
Initiating audits into the Company’s performance
via the Chairman of the Company’s Management
Board;
•
Considering and making decisions on internal
control procedure reports submitted by the
Chairman of the Company’s Management Board
or the Audit Committee;
•
Considering conclusions made by the Audit
Commission;
•
Efficiently evaluating the internal control system.
Audit Committee of the Board of Directors
The Audit Committee’s areas of competency within
the internal control system involve:
•
Overseeing the internal control system with
respect to accounting and finances;
•
Overseeing preparation of the Company’s Reports by its executive bodies and ensuring that
the Reports are unbiased.
Key responsibilities:
•
•
•
Technical Oversight and Audit Department:
Key responsibilities:
•
•
•
Chairman of the Management Board
The Chairman of the Management Board ensures
the enforcement of internal control procedures
through internal control departments within the
Company and makes decisions based on internal
investigations.
Organizing control procedures over the Company’s financial, production and administrative
activities, as well as for its subsidiary and dependent companies (SDCs), aimed at preventing,
revealing and eliminating violations in monetary
resources and funds management and at remedying consequences of said violations; organizing
investigations into cases of abuse (fraud);
Interacting with external control bodies;
Administratively supporting the Company’s Audit
Commission and controlling the enforcement of
its recommendations and decisions.
•
•
Engaging in selective efficiency control of the
production and technical performance of structural departments of the Company’s executive
bodies, branches and SDCs, including the internal technical control system, and evaluating
their compliance with existing requirements;
Identifying problem areas, analyzing and forecasting existing and potential risks, reasons and
possible consequences of negative trends, and
developing remedy measures related to the Company’s production and technical performance;
The establishment and technical oversight over
existing power facilities and quality control
over technical maintenance and repairs;
Selective technical oversight at facilities undergoing reconstruction, technical upgrades or new
construction (including new-generation facilities), aimed at checking their compliance with
existing requirements;
Controlling and evaluating production safety
compliance with existing requirements.
139
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ABOUT THE COMPANY
PRODUCTION OVERVIEW
INVESTMENTS AND INNOVATIONS
ECONOMIC AND FINANCIAL PERFORMANCE
CORPORATE GOVERNANCE
SOCIAL RESPONSIBILITY
Internal Control Division
•
Key responsibilities:
•
•
•
•
Developing and upgrading the methodology, organization and performance principles of Federal Grid Company’s internal control system,
efficiently analyzing the internal control system
across all areas of operations and developing
recommendations on efficiently improving the
internal control system;
Establishing ongoing internal control procedures
for Federal Grid Company’s accounting, regular
internal inspections for accounting and operational information, establishing prompt control
procedures for information about the planned
and actual performance figures for Federal Grid
Company’s departments and SDCs;
Identifying and analyzing Federal Grid Company’s risks, developing and updating the Risk
Matrix and developing recommendations to reduce and prevent risks;
140
•
Promptly controlling and efficiently analyzing the
accounting processes for Federal Grid Company
and its SDCs;
Efficiently analyzing a system for authority distribution across management levels of Federal
Grid Company;
Developing and updating the Authority Delegation Matrix and overseeing authority distribution
principles.
In 2010 as part of internal control procedures, the
internal control departments of Federal Grid Company carried out probes in accordance with approved
annual targets in respective responsibility areas.
2011 plans include developing and approving the
Financial Control Policy and the Authority Delegation
Policy. In 2011 Federal Grid Company will also update
egulations on the Internal Control System.
FEDERAL GRID COMPANY
ANNUAL REPORT
2010
5.7 RISK MANAGEMENT SYSTEM
Federal Grid Company has a risk management system
that is regulated by organizational and administrative
documents on two levels:
•
•
Risk management policy (outlines requirements, principles and approaches to the risk
management system);
Usage procedure for the risk management
policy (stipulates procedures on risk management system functioning, risk identification and
evaluation methods, risk reporting and risk response procedures).
The aim of the risk management system:
to ensure the Company’s sustainable undisrupted
performance and growth through early identification, evaluation and effective management of risks
that can compromise the efficiency of the Company’s
business operations and reputation, employee health,
the environment and the property interests of shareholders and investors.
Participants of the risk management system:
•
•
•
•
•
Management Board
Deputy Chairmen of the Management Board
Heads of structural sub-divisions
Branch heads
Internal Control Division
The risk management system involves the
following procedures:
1. Risk identification methods
Risk identification involves methods based
on the ISO/IES 31010 and COSO standards (analysis, evaluation of threats, expert evaluation and an event tree).
2. Risk evaluation criteria
Risk evaluation criteria include: the possibility
of the risk being realized; the risk’s fi nancial
impact; risk manageability. Risk possibility and
fi nancial impact define its importance. The risk
importance estimate can be increased if the
Company is intolerant to the risk or if a number
of departments of the Company’s Executive Bodies, branches or SDCs are subject to this risk.
3. Risk response methods
Risk response methods are carried out as one
of the following strategies: risk acceptance;
minimization of consequences; risk assignment to a third party; risk avoidance; combined measures. The strategy selection is
discussed with the Internal Control Division
and is approved by the Management Board.
4. Risk reporting procedures and timeframes
Risk owners submit their risk reports to the Internal Control Division on a quarterly basis. If
necessary, the Internal Control Division amends
the reports and approves changes with the risk
owners. The amended submitted reports are
used as the basis for the Risk Matrix and the
Set of Risk Minimization Measures, which are
submitted to Federal Grid Company’s Management Board for approval.
141
5.0
ABOUT THE COMPANY
PRODUCTION OVERVIEW
INVESTMENTS AND INNOVATIONS
ECONOMIC AND FINANCIAL PERFORMANCE
CORPORATE GOVERNANCE
SOCIAL RESPONSIBILITY
Management Board
3
4
Risk Owners
(Heads of Divisions,
Directors)
2
Internal
Control Division
5
1a
2a
1
5
Structural Departments
of the EO (Executive Office)
6
1
1а
2
2a
3
4
5
6
Risk identification and evaluation, reporting on risks and providing information about realized risks
Analysis of risk reports, amendments to risk reports, the discussion and approval of changes with risk owners
Discussion and approval of reports with corresponding heads of the EO Departments and directors
Amendments to reports following discussion and approval with Heads of the EO Departments and directors
Preparation of the Risk Matrix and the Set of Risks and Minimization Measures, their submission for
Management Board approval, including control over the implementation of already approved risk-infl uencing
measures and risk evaluation of performance analysis
Approval of the Risk Matrix and the Set of Risks and Minimization Measures
Distribution of approved risk minimization measures
Implementation of approved risk minimization measures
Main Risks and Measures Aimed
at Minimizing Them
Global (Strategic) Risks
Considering the special importance of undisrupted performance and the UNEG development, risks
deemed to be global (strategic) are the risk of accidents and performance disruptions for the UNEG,
which involves the risk of incorrect performances of
RPA and ECA and poorer quality and/or disruptions
in electricity supplies. Detailed information on these
risks is available in the Production Risks section.
Country-Specific Risks
Federal Grid Company does not view country-specific
and regional risks as important in its operations.
142
Industry-Specific Risks
Considering the specifics of Federal Grid Company
as a natural monopoly, the main industry-specific
risks are tariff risks, for example, risks that affect
the cost of services provided. Tariff risks include,
above all, the risk related to the state regulation of
tariffs, the risk of the non-implementation of the
investment program financing plan and the risk of
the non-implementation of plans for an increased
number of assets.
Risks Associated with the State
Regulation of Tariffs
As a result of the growth containment policy for tariffs on products and services of natural monopolies,
which is currently being implemented by the Russian
Government, there are risks that regulatory bodies
will introduce tariff s far below economically-justifi ed levels.
FEDERAL GRID COMPANY
On 28 December, 2010, Resolution No. 486-e/3
of the FTS approved tariffs for the UNEG electricity transmission services provided by Federal Grid
Company for 2010-2014. Under the resolution, the
increase in the average tariff for the UNEG electricity transmission services provided by Federal Grid
Company (over the long-term regulatory period) will
be 32.8% in 2011, 27.0% in 2012, 21.1% in 2013 and
15.2% in 2014. Tariff growth rates for 2011 will remain unchanged. Previously, the Russian Ministry of
Economic Development had said that tariff growth
rates already approved for 2011 can be revised downwards. This was due to the Government’s decision to
limit the growth in electricity tariffs for consumers
in 2011 to 15% and below. In particular, the tariff for
Federal Grid Company was planned to be reduced by
smoothing the tariff in the transition to the five-year
regulatory period.
Managing risks associated with tariff regulation involves effective interaction between Federal Grid
Company and power industry regulatory bodies to
develop economically-grounded tariffs, and for interactions with electricity market players within the
membership of the Market Council.
Non-Implementation of Investment Program
Financing Plans
The risk of the non-implementation of the investment
program financing plan is caused by the possibility
of service tariffs being set (or amended for future
periods) at a level that is insufficient to cover the
Company’s actual expenses.
These risks may be realized if the investment program is not implemented, as a result of not meeting planned timeframes for providing financing to
facilities additionally included in the investment program and facilities previously not planned for in the
investment program, and also if the actual cost of
investment program facilities exceeds the target level
when raising funds in the amount needed to implement Federal Grid Company’s investment program
is impossible.
Considering that the investment program financing
amount is used in calculations of Federal Grid Company’s electricity transmission tariff, non-implemen-
ANNUAL REPORT
2010
tation of the investment program, for any reason,
can result in a commensurate reduction in the tariff
in later periods.
To ensure financing for the investment program by
improving operational efficiency, the Company approved the Comprehensive Cost-Cutting Program
with the following principal aims:
•
•
•
•
•
•
Reducing informational service costs;
Optimizing site maintenance expenses, including
utility expenses;
Reducing office rent expenses;
Cutting business trip expenses;
Decreasing insurance expenses by tender
procedures;
Reducing production program costs by using internal resources for part of the work targets, reducing
the price of work and material acquired by the
Company, without reducing actual work amounts,
and by partially dropping target repair programs.
To reduce the risks of higher actual project costs,
compared to those planned for and included in the
tariff, the Company developed a system to discuss,
approve and control changes in agreements with
suppliers and contractors and introduced regular
reporting on results of the capital expenditure financing plan and the planned work schedules. The
risk of the inability to raise monetary funding in the
amount needed to finance the investment program
is minimized by diversifying financing sources: the
Company signed agreements with several lending
organizations to open up credit lines and successfully
completed a bond issue.
Non-implementation of the Plan for
an Increased Number of Assets
A factor that contributes to the non-implementation
of the plan for an increased number of assets is the
late inclusion of facilities in the investment program
(due to incorrectly identifying facilities that limit the
grid’s output amid a strong increase in electricity
consumption). Consequences of realizing this risk is
a possible reduction in the tariff for later periods in
accordance with amounts not used as a result of late
facility commissioning. There is also the possibility
of damages represented by lost profits due to the
143
5.0
ABOUT THE COMPANY
PRODUCTION OVERVIEW
INVESTMENTS AND INNOVATIONS
ECONOMIC AND FINANCIAL PERFORMANCE
CORPORATE GOVERNANCE
SOCIAL RESPONSIBILITY
inability to provide electricity transmission services
and a reputation loss due to the non-implementation
of important projects.
To minimize the risk realization possibility Federal
Grid Company works to include new facilities in the
investment program (on schedule) and to amend the
investment program when possible.
Legal Risks
Federal Grid Company believes that there is a significant risk of lawsuits and claims filed by third parties
over disputable situations, as well as for lawsuits
and claims filed by Federal Grid Company against
third parties.
To minimize the consequences of legal risks the Company uses different mechanisms aimed at reaching agreement with contractors and defending its
views (through pre-court settlement procedures and
amicable agreements during court litigation) and at
defending the Company’s interests in court actions.
Information about ongoing lawsuits in 2010:
•
•
The Company faced court claims worth a total of
RUR10,540 – in debt claims;
The Company faced court claims worth
a total of RUR3,303,822,347.24 (including RUR3,132,956,842.24 in debt claims and
RUR170,865,505.50 in sanctions).
Production Risks
Risk of Accidents and Disruptions in the UNEG
Federal Grid Company believes that the most important production risk is the risk of the UNEG accidents
and disruptions. The risk is affected by numerous
factors, including all errors (failure to act) of the
operational staff, the incorrect performance of relay
protection and automatic equipment and emergency
control automatics (hereinaſter, the RPA and ECA)
and poorer quality of and disruptions in electricity
supplies.
Corporate efforts to reduce the possibility and consequences of the risk of accidents and disruptions in
the UNEG are aimed at fighting risk factors.
144
Incorrect RPA and ECA Performance
To reduce this risk Federal Grid Company upgrades
algorithms for its ECA hardware and soſtware complexes and replaces morally outdated and depreciated RPA sets. Additionally, the Company works to
upgrade its employees’ skills, monitors RPA and ECA
performance and regularly analyzes technological
violations to identify reasons and develop measures
to eliminate them.
Poorer Electricity Quality
To reduce the risk implementation possibility the
Company develops respective regulations on quality
control, adjusts and expands agreements on electricity transmission services and implements technical
measures aimed at electricity quality control.
Disruptions in Electricity Supplies
Disruptions in electricity supplies, which are caused
by outdated equipment, can be minimized by implementing the Company’s investment program and
meeting technical maintenance targets. To minimize
natural factors the most effective measure is to apply the approved Procedure for Normative Maintenance of Overhead Transmission Line Routes, which,
among other things, stipulates the procedure for
removing trees and bushes from routes. Special attention is paid to enhanced control over sub-contractors.
Risks Related to Innovative Development
and Improving Energy Efficiency
Federal Grid Company views implementing innovative
development and energy efficiency improvement programs as highly important. Implementation violations
may be the result of changes in requirements set by
regulatory bodies and by the insufficient efficiency
of third parties involved in program implementation.
Realization of these risks can lead to penalties being imposed on Federal Grid Company and negative
reputational consequences, which in turn can lead to
higher funding costs.
To reduce the possibility or consequences of risks
related to upgrading energy efficiency Federal Grid
Company has developed and introduced regulations
on interactions between structural departments
about program implementation and has also intro-
FEDERAL GRID COMPANY
duced a data retrieval and analysis system to characterize program implementation.
The Innovative Development Program was discussed
by the Company’s Board of Directors and the Strategy
Committee of the Board of Directors. There are plans
to complete a technical and technological audit of
program results, which will later be considered by the
Russian Ministry of Energy.
The funding needed to implement the programs in
a timely manner has been included in the budget of
Federal Grid Company.
Environmental Risks
Environmental safety and the rational use of natural
resources are prominent on the agenda of Federal
Grid Company. For legislative violations the Company
can face high fines (based on Russian legislation).
The possibility of these risks is evaluated as insignificant with insignificant consequences for Federal
Grid Company’s operations.
Of special importance are risks related to Federal
Grid Company’s equipment that contains trichlorodiphenyl. A contributor to realizing this risk is strong
equipment wear and tear.
Consequences of this risk include potential environmental pollution and trichlorodiphenyl -poisoning for
the Company’s personnel and/or general population.
Additionally, if there are violations in maintaining,
storing or utilizing procedures for trichlorodiphenylcontaining equipment, Federal Grid Company can
face sanctions from state regulatory bodies.
The tool to reduce environmental risks is the Company’s Environmental Policy (as approved by the Company's Board of Directors). The Company implements
it E in accordance with the Environmental Doctrine
of the Russian Federation, its own Environmental
Policy and the opinions of leading environmental
protection groups. When new facilities are designed, the environmental aspect is developed as
a stand-alone part of the project and takes into
account all requirements of Russian environmental legislation. All construction and reconstruction
projects of the electric grid facilities are subject to
state environmental examination.
ANNUAL REPORT
2010
In 2H 2010 the Company approved the 2011-2013
Environmental Policy Implementation Program, which
outlines numerous organizational and technical measures aimed at risk reduction, minimization of environmental pollution, introduction of an environmental
management system, environmental auditing and
development of normative and technical documents
related to the environment.
In order to reduce the risk of damages from using
and storing potentially hazardous equipment, the
Company developed and approved the target program for decommissioning equipment that contains
trichlorodiphenyl, introduced efforts to collect and
update information about equipment that contains
trichlorodiphenyl and exerts ongoing control over
decommissioned equipment.
Financial Risks
Currency Risks
Federal Grid Company’s revenues from electricity
transmission services are calculated in the Russian
national currency – the Russian rubles (RUR). The
Company’s current loan and debt obligations are
also ruble-denominated. Thus, risks are negligibly
low. In terms of exchange rate fluctuations for foreign currencies, these fluctuations affect the Russian
economy as a whole and can therefore indirectly
influence corporate operations.
Liquidity Risks
Considering the current liquidity level, the Company
runs a negligibly low risk of failing to fulfill its obligations in full within the set timeframe. The Company
services its previously raised loans in strict accordance with approved schedules.
In order to reduce potential consequences of this risk,
the Company controls its debt burden and creditworthiness. The Company’s creditworthiness criteria and
their target levels are stipulated by Regulations on the
Credit Policy and are approved by the Board of Directors (Minutes No. 116, as of 29 September, 2010).
Interest Rate Risk
The risk of higher interest rates on loans can prove
to be significant for the Company if its debt burden
shows strong growth. As a result, the risk of higher
145
5.0
ABOUT THE COMPANY
PRODUCTION OVERVIEW
INVESTMENTS AND INNOVATIONS
ECONOMIC AND FINANCIAL PERFORMANCE
CORPORATE GOVERNANCE
SOCIAL RESPONSIBILITY
interest rates can affect the Company’s expenses on
debt re-payment. To ensure borrowed financing and
minimize the risk of changes in interest rates the
Company aims to diversify its borrowing portfolio
tools.
Inflation Risks
The current inflation rate has no significant effect
on the Company’s financial standing. A critical inflation rate is a level exceeding 30%.
Risks Related to a Possible Increase in Accounts Receivable
Federal Grid Company’s economic risk factor is the
increase in accounts receivable, which can be triggered by the poorer performance of the Company's
contractors and their inability to pay for the Company’s services within a set timeframe. The possibility
of these risks arising can be linked to a downturn in
Russia’s economic situation as a whole.
The impact of these factors is minimized by introducing a program to optimize expenses, monitor the
market and enact tougher payment discipline for
consumers, among other measures.
146
Risks Related to the Company’s Investment, Which Has an
Anticipated Yield of More than 10 Percent Per Annum
ВIn 2010 as a result of the completed restructuring
of promissory note debt of FC Otkrytie and OtkrytieFinans (which began in 2009 due to the companies’
inability to fulfill their obligations), the Company’s balance sheet received six promissory notes of ENERGOFinans worth a total of RUR12 billion, with a yield of
13% per annum. The restructuring was in line with
the Russian Ministry of Energy’s instructions.
In order to upgrade the liquidity of securities and
minimize the risk of non-redemption, promissory
notes were secured by a guarantee of a bill by the
Rusenergo Limited Fund.
The Company made no other investment with a yield of
more than 10% in 2010.
FEDERAL GRID COMPANY
ANNUAL REPORT
2010
5.8 SHARE CAPITAL
In accordance with the Articles of Association, as of 31 December, 2010,
the share capital of Federal Grid Company stood at RUR 616,780,666,776,
divided into 1,233,561,333,552 ordinary registered non-documentary
shares with a nominal value of RUR 0.50 per share.
The number of authorized shares is 113,244,490,279
ordinary registered shares with a nominal value
of RUR0.50 per share worth a total of
RUR56,622,245,139.50 (nominal value). Authorized
shares have the same rights as issued ordinary
shares.
5.78%
14.74%
No preferred shares were placed.
On 4 February the Company completed placing an
additional issue of ordinary shares with a price of
RUR0.5 per share. A total of 22,386,794,841 shares
were placed via the additional issue, representing
79.14% of available shares. The placement generated
RUR11.193 billion for the Company.
The main participant in the additional share issue
was the Russian Federation, which acquired shares
worth RUR11.189 billion. The remaining part of placed
shares, worth RUR4.147 billion, was purchased by
minority shareholders.
Proceeds from the additional share issue will be used
to upgrade the reliability of power sector facilities
in the Sochi Region ahead of 2014 Olympic Games
preparation and to implement “Economic and social
development of the Russian Far East and Trans-Baikal
for the period to 2013” Federal Target Program.
79.48%
Russian minority shareholders
Russian minority shareholders
Russian Federation Agency
for State Property Management
On 25 March, 2011, the Company registered amendments to its Articles of Association under which share
capital totals RUR627,974,064,196.50 (six hundred
twenty-seven billion nine hundred seventy-four million sixty-four thousand one hundred and ninety-six)
and 50 kopecks.
147
5.0
ABOUT THE COMPANY
PRODUCTION OVERVIEW
INVESTMENTS AND INNOVATIONS
ECONOMIC AND FINANCIAL PERFORMANCE
CORPORATE GOVERNANCE
SOCIAL RESPONSIBILITY
State
registration
number for
the issue
State
registration
date and
issue
Placement
price
Placement
method
Number of
issued shares
Total number of
shares (following
the additional
share issue)
Registration
date for
reporting on
the issue
results
1-01-65018-D
10.09.2002
RUR0.5
Distribution
among company
founders
243,214,483,559
243,214,483,559
10.09.2002
1-01-65018-D-001D
21.03.2006
RUR0.5
Closed
subscription
placement to
RAO UES of
Russia
118,167,724,361
361,382,207,920
15.05.2007
1-01-65018-D-002D
23.08.2007
RUR0.59
Closed
subscription
placement to
RAO UES of
Russia and
Federal Agency
for State Property
Management
114,965,254,235
476,347,462,155
18.04.2008
1-01-65097-D-097D
03.06.2008
–
Conversion
upon merger
737,588,491,911
1,153,514,196,362
12.08.2008
1-01-65098-D-098D
03.06.2008
–
Conversion
upon merger
34,154,626,385
1,153,514,196,362*
12.08.2008
1-01-65018-D-101D
25.12.2008
RUR0.51
for open subscription
Open
subscription
80,047,137,190
1,233,561,333,552
26.01.2010
Open
subscription
22,386,794,841
1,255,948,128,393
01.03.2011
RUR0.5 for
entities with
pre-emptive rights
1-01-65018-D-102D
12.08.2010
RUR0.5 for open
subscription
RUR0.5 for entities
with pre-emptive
rights
* 94,576,384,089 shares were redeemed (annulled)
148
FEDERAL GRID COMPANY
ANNUAL REPORT
2010
Number of the Company’s Shareholders as of 31 December, 2010
Number of
holders
Number of individuals registered in the shareholder register
Number of
shares
% of the total
number of shares
412,775
10,549,483,174
0.8400
1,458
1,251,239,357,525
99.6251
nominee holders
65
246,236,484,889
19.6056
trust managers
6
5,101,036
0.0004
Issuer’s issuer account
1
5,901,991,179
0.4699
1 711
61,265,519
0.0049
1
3,922
0
415 945
1,261,850,110,141
100
Number of legal entities registered in the shareholder register
(including nominee holders, trust managers
and the Issuer’s issuer account)
Number of separate accounts for accounting for
securities in joint shared ownership
Number of separate accounts for accounting for securities of undisclosed entities
Total number of entities registered in the shareholder register
List of Registered Entities That Hold More Than 2%
of Accountable Shares in Their Individual Accounts as of 31 December, 2010
№
Registered entity type
Name
Number of shares
1
Owner
The Russian Federation, represented
by the Russian Federation Agency
for State Property Management
998,216,115,886
79.48
2
Nominee holder
Depository Clearing Company
79,451,549,039
6.33
3
Nominee holder
Depository and Corporate Technologies
67,916,184,242
5.41
4
Nominee holder
Non-banking Credit Organization
“National Settlement Depository”
59,513,606,178
4.74
5
Nominee holder
ING BANK (EURASIA)
27,076,780,253
2.16
Information about the Registrar
В In December 2010, due to a decision by the
Russian Federal Financial Markets Service to cancel
the register-maintaining license of Central Moscow
Depository, the Company decided to cancel its
agreement with Central Moscow Depository (CMD)
on keeping and storing the Register of Owners
of Nominal Securities. Since February 2011 the
Company’s Registrar has been STATUS Registrar
Company, which was selected via an open tender.
Share of share
capital, %
Location: 32 Novorogozhskaya Street, bld 1,
Moscow, Russia, 109544
Mailing address: 32 Novorogozhskaya
Street, Bld 1, Moscow, Russia, 109544
Telephone: +7 495 974 8350
Fax: +7 495 678 7110
Email: info@rostatus.ru
License No.: 10-000-1-00304
Issue date: 12.03.2004
Valid through: Unlimited
Issuing authority: The Federal Financial
Markets Service (FFMS)
149
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ABOUT THE COMPANY
PRODUCTION OVERVIEW
INVESTMENTS AND INNOVATIONS
ECONOMIC AND FINANCIAL PERFORMANCE
CORPORATE GOVERNANCE
SOCIAL RESPONSIBILITY
Geographical breakdown of foreign investors
2%
Foreign investors by investing style
26.7%
6%
8%
0.33%
8%
28.8%
47%
11%
44.0%
18%
USA
UK
Sweden
Germany
Norway
Netherlands
Other
Source: ThomsonOne
The share of foreign investors in Federal Grid
Company’s share capital stood at 5.78% as of
31 December, 2010.
150
Growth, Core Growth,
GARP
Index
Core Value
Equity Hedge
Source: ThomsonOne, shareholder register data
Most of the foreign buy-side investors continue to
view the Company’s shares as promising, with the
growth rates for the Company’s profi t and/or share
value exceeding average levels for other companies
in the same industry. One-third of the investment
is so-called “index investors” (29%), another 27%
comes from investors who believe the Company’s
shares are currently heavily undervalued. Hedge
funds account for only 0.33%, aſt er seeing a
marked decline (16.87%), which is generally seen
as a positive.
FEDERAL GRID COMPANY
ANNUAL REPORT
2010
5.9 STOCK MARKET
The Company’s shares trade on the B quotation
list for MICEX and RTS and on the Main Market
of the London Stock Exchange.
The fundamental appeal of the Company’s stock
is evidenced by its inclusion in Russian and foreign
indices. As of 30 December, 2010, the Company’s
weighted share in the MICEX Power Index stood at
14.33%, making it one of the largest participants
among power sector companies included in the index. In the RTS Power Index Federal Grid Company
traditionally trails only RusHydro.
Company’s depository receipts started trading on the
Main Market of the London Stock Exchange under the
FEES ticker symbol.
Additional information about our GDR program
is available on the corporate web site at
http://www.fskees.ru/eng/investors/share_information/gdr_program/.
GDR Program Highlights
Federal Grid Company’s Share Weighting in Key
Stock Indices, % (Data as of the end of the year)
Index
2009
Regulation S
Rule 144A
Ratio
1 GDR: 500 shares
1 GDR: 500 shares
International code
ISIN:
US3133542015
Common Code:
036273577
ISIN:
US3133541025
Common Code:
0362733372
Market price
as of 31.12.2010
USD 6.10
USD 6.10
Amount of GDRs
as of 31.12.2010
3,203,411
78,518
2010
MSCI Russia
1.43
1.48
MSCI Emerging Markets
(as of the inclusion date)
0.045
0.045
ММВБ
1.69
1.51
Micex PWR
13.94
14.33
Micex LC
2.01
1.97
RTSI
1.67
1.66
RTSeu
22.06
18.99
RTS STD
2.01
2.11
Global Depository Receipt (GDR) Program
On 30 June, 2008, the Company launched a Global
Depository Receipts (GDR) Program, which was not
listed in accordance with Regulation S and Rule 144A.
One depository receipt represents 500 shares. The
Program’s depository bank is Deutsche Bank.
Company’s Shares Highlights
Share category
ordinary registered
non-documentary shares
Nominal value
RUR0.5 per share
MICEX ticker symbol
FEES
RTS ticker symbol
FEES
FEESSG
ISIN
RU000A0JPNN9
Bloomberg code
FEES RM
FEES RX
FEESS RU
FEESG RU
Thomson Reuters code
FEES-MZ
FEESS.RTS
FEES.RTS
FEESG.RTS
As of 31 December, 2010, the Program was equal to
0.133% of the Company’s share capital.
In March 2011, the Company successfully completed
the technical listing procedure for depository receipts
on the London Stock Exchange. On 28 March the
151
5.0
ABOUT THE COMPANY
PRODUCTION OVERVIEW
INVESTMENTS AND INNOVATIONS
ECONOMIC AND FINANCIAL PERFORMANCE
CORPORATE GOVERNANCE
SOCIAL RESPONSIBILITY
Stock Price Performance and Trading Volume on MICEX
Date
Notes
1
04.02.10
Release of the 1H 2009 IFRS statements
2
24.03.10
Meeting between the Company’s managers and analysts
3
20.04.10
Meeting with analysts to discuss 2009 results and 2010-2012 plans
4
12.05.10
0.08% increase in the Company’s share in the MSCI Russia index to 1.75%
5
17.05.10
Release of 1Q 2010 RAS statements
6
04.06.10
The Ministry of Economic Development’s proposal to limit the Company’s tariff to 15% in 2011
7
17.06.10
Announcement of fi ve-year investment program highlights
8
29.06.10
AGM
9
21.07.10
Release of the 2009 IFRS statements, meeting with analysts
10
02.08.10
Release of 2Q 2010 RAS statements
11
10.08.10
Meeting with analysts to discuss 1H 2010 results
12
25.08.10
Release of the Federal Tariff Service’s draſt Resolution on the rates of return for invested
capital within the RAB framework
13
29.09.10
Completion of the Company’s Series 6, 8 and 10 bond issues placement worth RUR30 billion
14
04.10.10
The Federal Tariff Service’s approval of corporate rates of return
15
21.10.10
The Russian Government’s announcement of plans to privatize Russia’s largest companies
with State participation, Federal Grid Company is one of these companies
16
02.11.10
Release of 3Q 2010 RAS statements
17
11.11.10
Release of 1H 2010 IFRS statements
18
16.11.10
Meeting with analysts following the release of 3Q 2010 RAS statements and the 1H 2010
IFRS statements
19
07.12.10
The Ministry of Economic Development’s proposal to limit the Company’s tariff to 25% in 2011
20
20.12.10
Approval of investment program and dividend policy
21
28.12.10
The Federal Tariff Service’s approval of the RAB tariff for a fi ve-year period for the Company
152
FEDERAL GRID COMPANY
ANNUAL REPORT
2010
Trading volume,
mln items
RUR
8,000.00
0.48
14
3
2
6,000.00
5
1
11
8
9
4
10
16
15
0.44
19
13
12
20
0.4
6
0.36
4,000.00
0.32
21
17
7
18
0.28
2,000.00
0.24
0.2
2010 Share Prices
In 2010 Federal Grid Company’s share price on MICEX
grew 15.3% and reached RUR0.369 on 30 December,
2010, which is 13% below the consensus forecast
from analysts and indicates further upside potential
in the Company’s stock price.
MICEX is the main trading platform for the Company’s
shares and accounts for more than 90% of market deal
volume.
30.12.10
21.12.10
07.12.10
23.11.10
10.11.10
25.10.10
11.10.10
27.09.10
13.09.10
30.08.10
16.08.10
02.08.10
19.07.10
05.07.10
21.06.10
04.06.10
21.05.10
06.05.10
21.04.10
07.04.10
24.03.10
10.03.10
24.02.10
08.02.10
25.01.10
11.01.10
0.00
Summary of Federal Grid Company’s share
performance on MICEX
Volume
Number
of deals
2009
2010
units
452,899,905,600
307,017,566,700
RUR
114,494,378,142.9
105,717,431,921
units
1,171,618
1,137,379
Source: MICEX web site
Key parameters of MICEX trading
2009
2010
Low
RUR
0.074
0.282
High
RUR
0.409
0.389
Period-end
RUR
0.320
0.369
Number of shares
mln shares
1,153,514
1,233,561
Capitalization
at year end
RUR, mln.
367,971.04
452,717.01
Additional trading information is available
in the respective section of our corporate web site at
http://www.fskees.ru/investors_tools_graph.html.
153
5.0
ABOUT THE COMPANY
PRODUCTION OVERVIEW
INVESTMENTS AND INNOVATIONS
ECONOMIC AND FINANCIAL PERFORMANCE
CORPORATE GOVERNANCE
SOCIAL RESPONSIBILITY
5.10 DIVIDEND POLICY
Federal Grid Company’s dividend policy is based on
Regulations on the Dividend Policy approved by the
Board of Directors on 16 December, 2010. According
to this document, the minimum dividend payout is
10% of RAS net profit aſter mandatory contributions
to the reserve fund adjusted (reduced) for paper profits from assets revaluation, the reserve for recovering
bad debts and non-recurring income from the sale of
securities and other property planned to finance the
Company’s investment program.
The General Shareholders Meeting makes dividend
payout decisions in accordance with the dividend size
recommended by the Board of Directors, based on the
Company’s posted financial results, while balancing
the interests of the Company and its shareholders.
2008
To maintain the Company’s financial stability amidst
the ongoing financial crisis, the Board of Directors
recommended that the General Shareholders
Meeting channel the Company's 2008 net profit to
corporate development. The resolution of the General
Shareholders Meeting (30.06.2009) approved the
allocation of RUR4,242,201,000 (95% of 2008 net
profit) to development and RUR223,201,000 (5% of
2008 net profit) to the corporate reserve fund. The
money allocated to corporate development was used
to finance specific projects to the extent determined
by a separate Board of Directors’ resolution as part
of the Company’s priority activities.
2009
For FY 2009 the Company posted a loss of RUR59.866
million. The principal reason for the 2009 operating
loss was the effect of the global financial crisis. The
loss resulted from writing off negative differences
from the market-price-based revaluation of assets
on the Company’s balance sheet. The source for
reserve fund allocations and dividend payments is
the Company’s net profit aſter tax (net profit), based
on accounting reports. In 2009 the Company had no
base (source) to pay dividends. The Annual General
Meeting of Shareholders decided not to pay dividends
154
Dividend History
Total dividend
accruals, RUR
thousand.
Per ordinary
share, RUR
2006
587,847.4
0.001626664
2007
380,000
0.0007977370096
2008
0
0
2009
0
0
on ordinary shares for 2009.
2010
For FY 2010 the Company posted a net profit of
RUR58,088,388,000.
The net profit for dividend calculations, excluding
financial results from securities revaluation and the
creation of provisions not backed by monetary funds,
was RUR25,776,639,000.
The decision on 2010 dividend payments will be
made by the Company’s Annual General Shareholders
Meeting in 2011.
Dividends, RUR thousand
Number of shares, units
Dividend per share, RUR
2,577,664
1,255,948,128,393
0.0020523650155
FEDERAL GRID COMPANY
ANNUAL REPORT
2010
5.11 INVESTOR RELATIONS
In 2010 the Company continued developing its investor relations
and enhancing information transparency to position Federal Grid
Company as one of the leading power sector companies.
The Company aims to provide full and reliable
information about its operations by holding personal
meetings with analysts and investors, participating
in conferences and regularly updating its corporate
web site.
For the second consecutive year the Company has
won an award in the category “For the Best Corporate
Governance Practices and Investor Relations” at
the contest organized by the Administration of the
Krasnoyarsk Region with the participation of the
Russian Institute of Directors and the Federal Service
for Financial Markets.
Last year S&P recognized Federal Grid Company as
one of the companies that has demonstrated the
greatest progress in information disclosure.
In 2010 the number of banks that provide analytical
coverage for the Company increased from 15 to 20,
including UBS, Unicredit and the Otkrytie Financial
Corporation.
The Company’s latest financial news, reports and presentations
are available on the corporate web site http://www.fskees.ru/eng/
investors/company_overview/.
Additionally, the Company’s investor relations specialists
are available at any time at +7 495 710 9064
or by email ir@fsk-ees.ru.
Liquidity
Capital Markets
Company Value
IR
Financial
Communications
Marketing
Disclosure
and Information
Transparency
155
MOVING FORWARD
WITH NEW ENERGY
ANNUAL REPORT
2010
SOCIAL
RESPONSIBILITY
TO BE SUCCESSFUL
IS TO BE BENEFICIAL
TO YOUR COUNTRY
6.0
ABOUT THE COMPANY
PRODUCTION OVERVIEW
INVESTMENTS AND INNOVATIONS
ECONOMIC AND FINANCIAL PERFORMANCE
CORPORATE GOVERNANCE
SOCIAL RESPONSIBILITY
6.1 SOCIAL RESPONSIBILITY
PRINCIPLES
Federal Grid Company’s corporate social responsibility (CSR) represents
the Company’s complex responsibilities toward interested parties
in the sphere of managing the Company’s impact on the surrounding
environment, society and economy. The Company voluntarily undertakes
these responsibilities and fulfills them publicly when interacting with
interested parties. These principles are oriented on ensuring sustainable
development and implementation of the Company’s strategy.
Our responsibility toward the state and consumers consists of ensuring the reliable and uninterrupted power supply of the UNEG objects, modernizing all objects in the UNEG power supply network in
a timely manner; developing and introducing innovative technologies, contributing to an increase in the
energy effectiveness of the UNEG, preventing and
promptly fixing technological breakdowns; utilizing
funds invested in the Company by the Government
in a transparent and effective manner.
Other important aspects of the Company’s CSR
include:
•
•
•
Responsibility toward environment –
for minimizing negative environmental impact;
Responsibility toward suppliers and contractors – creating a transparent competitive environment and market mechanism for
pricing,
Responsibility toward personnel – for creating appropriate labor conditions and opportunities for professional and personal growth.
Strengthening Corporate Culture
Federal Grid Company’s corporate culture, including
values as well as standards of behavior and work,
forms the corporate perception for its employees,
stimulates feelings of responsibility, prompts the
realization of succession and helps build correct reactions to events taking place in the Company. It also
creates a feeling of safety. We consistently work
158
to develop corporate culture and our effort is also
aimed at creating a feeling of affinity with our team
of employees and the acceptance of our development
philosophy, methods of work, form and subject matter
of relationships inside the Company.
In 2010, Federal Grid Company actively worked to
develop a new Corporate Ethics Code. Significant changes in the Russian power sector and in the
Company itself, as well as the Company’s goal to
conform with global best corporate governance practices, made replacing the previous document necessary. The new Code project contains an ideological
(mission, goals and values) and normative (general rules of conduct; prohibited conduct; chapters,
descriptions of separate risks) parts. It is expected
that the new Corporate Ethics Code will be adopted
by the Company’s Board of Directors in 2011.
To preserve professional traditions educate the youth
and recognize longstanding conscientious labor in
the beginning of 2010 the Company launched the
Dynasty of Federal Grid Company program.
During the year, contests for the title of best dynasty
were held in the branches of Federal Grid Company –
MES. The contest counted not only production
indicators of dynasty members, but also their
overall length of corporate service.
In terms of organizing corporate events, the most
popular and accessible events are traditionally sports
competitions. In 2010 the Third Summer Olympics
FEDERAL GRID COMPANY
Federal Grid Company’s corporate culture,
including values as well as standards of
behavior and work, forms the corporate
perception for its employees, stimulates
feelings of responsibility, prompts the
realization of succession and helps build
correct reactions to events taking place
in the Company. It also creates a feeling
of safety.
of Federal Grid Company was held. Preliminary
rounds were organized at the corporate branch level
and final contests took place in Moscow from 28
to 30 June. More than 2,500 Company’s employees
participated in the Olympics.
Cooperation with universities training specialists in the power industry continued. In 2010, the
Company cooperated with 45 profiled educational
institutions. Days of Federal Grid Company were
held for students, during which corporate managers
spoke about primary development directions for the
UNEG, promising the implementation of innovative
corporate projects and the Company’s need for highly
qualified specialists.
In summer 2010 the Company re-launched organizing
work for summer student groups. At sites of Federal Grid
Company’s MES Center branch, 50 students from the
Moscow Power Engineering Institute working line brigades carried out swath clearing and assembled metal
ANNUAL REPORT
2010
constructions for power line columns in the Ivanovo,
Vladimir and Moscow Regions.
Social Responsibility and Corporate Sustainability Reports
Since 2008 the Company has published an annual
Social Responsibility and Corporate Sustainability
Report; these Reports present separate corporate
mechanisms, ensuring the quality of corporate work
and the absence of economic, environmental and
social impact in the regions in which the Company is
present. Reports are prepared in accordance with GRI
sustainability reporting framework guidelines (version
G3). Interactions with interested parties during preparation of the Reports are based on the principles of
the Stakeholder Engagement Standard AA 1000 SES.
As part of the process of preparing the Annual Report,
the Company conducts conversations with interested
parties, during which key issues of the Report are discussed and disclosure requests are gathered. Prior to
publication, the prepared text of the Report undergoes
public discussion in one or another form (in person or
in absentia publicly held hearings).
Federal Grid Company reports are included in the
National Registry of Corporate Non-Financial Reports, which was formed by the Russian Union of
Industrialists and Entrepreneurs (RUIE).
The full text of Federal Grid Company’s social responsibility and
corporate sustainability reports can be found on our web site
http://www.fsk-ees.ru/about/corporate_social_responsibility/.
Interactions with Stakeholders
CSR implementation is performed through regular
interactions and dialogues with external interested
parties (stakeholders).
List of key stakeholders:
•
Government;
•
minority shareholders;
•
consumers;
•
local state authorities in Russian
Federation subjects;
•
environmental community;
•
contractors and suppliers;
•
corporate employees;
•
other energy companies (generation companies,
System Operator, IDGCs).
159
6.0
ABOUT THE COMPANY
PRODUCTION OVERVIEW
INVESTMENTS AND INNOVATIONS
ECONOMIC AND FINANCIAL PERFORMANCE
CORPORATE GOVERNANCE
SOCIAL RESPONSIBILITY
As part of 2010 CSR management, the Company
carried out the following interactions:
Key 2010 Measures Important for Sustainable
Development and Social Responsibility
•
•
•
•
•
with shareholders and investors (annual general meetings of shareholders; meetings of the
Company’s managers with investment bank and
investment fund analysts; consultative meetings
with minority shareholders – physical persons;
online seminars for investors; the participation
of top management in conferences organized by
investment banks);
with local authorities of Russian Federation
subjects and energy companies (concluding
cooperation agreements in the field of UNEG
development and the coordination of development plans);
with personnel (implementation of the Dynasty
Program, the Open Doors Day, conducting the
Third Summer Olympics, organizing summer
student groups, etc.);
with suppliers and contractors (Concluding
agreements on cooperation with companies including Alstom Grid, Siemens AG, Elektrozavod,
Ener 1 and others).
In 2010 the Company participated in the St. Petersburg International Economic Forum and the
Sochi-2010 International Investment Forum, at which
they signed more than 10 agreements with Russian
and foreign producers and developers of electrotechnical equipment.
One of the most important tasks in interacting with
external interested parties is participation by the
Company’s employees in rule-making activity. In
2010, our experts participated in forming more than
10 ministerial decrees and/or governmental regulations, related to the order of land utilization, utilization
and protection of forests, ensuring a reliable and high
quality power supply, organizing the power supply for
the XXII Olympics in Sochi and other issues.
160
•
•
•
•
•
•
•
•
Elaboration on and adoption of a Policy for the
innovative development and modernization of
the UNEG, including creating a new generation
electric grid in Russia – smart grid;
Adoption of the Program on implementing the
Company’s 2011-2013 environmental policy;
Development of Federal Grid Company’s Import
Replacement Program aimed at use of locally
produced equipment, technologies, materials
and systems;
Extension of the period for long term RAB-based
tariff regulation on the provision of services for
Federal Grid Company to 5 years;
Adoption of the program to create training centers for Federal Grid Company’s production personnel, with realization from 2010 till 2012;
Adoption of the Program to address corruption
and settle conflicts of interests in the Company
for 2010-2011;
Development of the Long-term Program for Corporate Assistance to Improve Housing Conditions
for Federal Grid Company’s Employees (submitted for adoption to Federal Grid Company’s
Management Board).
Development of a new Corporate Ethics
Code (submitted for adoption to Federal Grid
Company’s Management Board);
Conducting dialogues with external interested parties “Information disclosure on Federal Grid Company’s activities in the sphere of
ensuring and managing operational safety of
the UNEG.”
Charitable Aid
Federal Grid Company is a socially-oriented Company
that offers a program of charitable aid to physical
persons. In addition, in 2010, the Company sponsored numerous sports, cultural, scientific and charitable organizations in the amount of approximately
RUR83 million.
FEDERAL GRID COMPANY
ANNUAL REPORT
2010
6.2 HR POLICY
Federal Grid Company’s HR policy is an integrated system
of interacting with personnel to achieve corporate strategic goals,
developing and sustaining the technical condition of the electric
grids and substations, upgrading the functional reliability of the UNEG
objects and realizing the Company’s investment program.
HR policy is aimed at balancing the economic and social
effectiveness of personnel usage, obtaining qualified
personnel in a timely manner for the Company’s divisions, creating conditions for effectively developing
and utilizing human resources, satisfying social and
economic expectations and meeting the needs and
addressing the interests of employees.
Primary principles of the Company’s
HR policy:
•
•
•
•
•
Ensuring effective organizational design and planning personnel requirements. Managing personnel
taking into account external and internal factors;
Selecting optimal methods for working with personnel, driven by the Company’s current development stage based on forecasts and strategic
production goal accountability, social and demographic, political, economic, legal and other external
environmental changes, as well as the impact that
they have on the Company’s personnel;
Improving the effectiveness of personnel utilization.
Engaging in qualitative and quantitative analysis
of expenses versus results, including employees’
training and career enhancement;
Observing current Russian legislative requirements;
Creating and operating a human resources management system that ensures effective and flexible
management of corporate human resources;
•
•
•
Ensuring that employees across all levels observe
(obligatory) human resources policy principles,
as well as human resources management system
as stipulated by internal normative documents;
Designating long-term key corporate principles of
human resources management, adhering to these
principles occurs under dynamic organizational and
economic changes, as well as changes in external
conditions;
Continually enhancing human resources man
gement methods based on modern concepts,
taking into account the Company’s characteristics and standards.
Key elements of the Company’s HR policy:
•
•
•
•
•
•
•
•
Upgrading the organizational and managerial
structure and personnel planning;
Training and developing personnel;
Motivating and remunerating the corporate
workforce;
Providing social assistance;
Managing activity performance;
Engaging in labor relations;
Providing administrative support;
Developing corporate culture and internal
communications.
161
6.0
ABOUT THE COMPANY
PRODUCTION OVERVIEW
INVESTMENTS AND INNOVATIONS
ECONOMIC AND FINANCIAL PERFORMANCE
CORPORATE GOVERNANCE
SOCIAL RESPONSIBILITY
Policy elements may be changed and obtain new
significance under the influence of corporate development dynamics or changes in external conditions
without interfering with the principle of policy succession.
Headcount and Qualitative Personnel
Composition
Federal Grid Company’s total number of personnel
stood at 22,623, as of 31 December, 2010.
A significant (89.6%) increase in corporate personnel in 2010 year-on-year is due to transferring the
functions for technical servicing and maintenance
of electro-technical equipment from Glavsetservis
UNEG to Federal Grid Company and the fact that
most employees of Glavsetservis UNEG joined Federal Grid Company branches. In 2009, Federal Grid
Company personnel increased 6.7% compared with
the previous year due to the fulfillment of a program
of measures to commission and launch new UNEG
objects and staff electro-technical objects received
from inter-regional distribution grid companies.
Employees Educational and Age Structure
As a high-technology economic branch, the power
sector places high demands on the knowledge and
qualification of employees. The Company’s personnel
are characterized by a high level of employee education. As of 31 December, 2010, more than 53% of
our employees have completed higher education, in
addition 23% have a vocational higher education.
The largest percentage of personnel are employees
of the most active productive age – up to 40 years
old (approximately 54% of personnel). In recent years
there has been a trend toward a decline in employees’
age. As of 31 December, 2010, the average age was
39.8 years. Therefore, the Company’s HR structure
is characterized by an optimal combination of young
employees with initiative and skilled highly professional employees actively sharing their knowledge
and skills with the younger generation.
To actively attract younger specialists, the Company
conducts a separate program. Within the framework
162
of this program, it actively works with senior high
school students and students from profiled universities and founds additional scholarship programs in
specialist fields, which are the most highly sought
aſter by the Company, including to attract employees in geographically remote regions. The Company
organizes internships and Open Door Days in Federal
Grid Company branches, with the aim of ensuring that
specialists quickly adapt to the Company’s conditions
and work specifics.
More than half of our employees have higher education. The average employee age is 40 years. The
Company’s HR composition is characterized by an
optimal combination of young employees with skilled
professionals.
Personnel Movement
The Company places significant weight on retaining
the most skilled and highly professional employees.
Within this framework the Company evaluates the
employee satisfaction level with labor conditions
and analyzes the dynamics and structure of staff
turnover.
In 2010, the Company organized a sociological survey of employees, during which personnel loyalty
was evaluated and professional and social factors,
which were the most important for employees, were
outlined. Based on the results of the survey, the
Company’s branches developed measures to upgrade
employee loyalty.
During recent years, staff turnover indicators have
declined steadily, which demonstrates the effectiveness of the implemented HR policy.
Material Incentives for Personnel
An important element of the Company’s HR policy is
the system of material incentives for personnel, which
ensures that the Company achieves its strategic
goals based on establishing connections between
the results of corporate operations and the individual
input of each employee.
FEDERAL GRID COMPANY
ANNUAL REPORT
2010
as of 31.12.2008
as of 31.12.2009
as of 31.12.2010
Headcount Dynamics, persons
6,000
5,000
4,000
3,000
2,000
1,000
MES East
MES Western Siberia
MES Siberia
MES Urals
MES South
MES Volga
MES North-West
MES Center
Executive apparatus
0
Qualitative composition of the Company’s personnel, persons
Personnel category
Total
Reporting period
2008
2009
2010
11,181
11,933
22,623
3,815
4,640
5,359
10,613
11,418
15,602
6,242
6,900
9,312
44
2
7,021
524
513
0
Including
Administrative and managerial personnel
Personnel breakdown by activity type, persons
Operating personnel
Including production and industrial personnel
Maintenance personnel
Mechanization and transportation employees
163
6.0
ABOUT THE COMPANY
PRODUCTION OVERVIEW
INVESTMENTS AND INNOVATIONS
ECONOMIC AND FINANCIAL PERFORMANCE
CORPORATE GOVERNANCE
SOCIAL RESPONSIBILITY
In respect to motivation and remuneration, the Company’s main principles are:
•
•
Ensuring a unified approach toward remuneration for all corporate employees;
Motivating employees to achieve corporate goals
Staff Turnover
%
More than half of our employees
have higher education. The
average employee age is 40
years. The Company’s HR
composition is characterized
by an optimal combination of
young employees with skilled
professionals.
7.5
8
6
4.4
4
3.4
2
Year
•
•
•
2008
2009
2010
and aims by improving the effectiveness of individual activities, as well as activities of structural
divisions and the Company as a whole;
Putting in place competitive compensation packages in the labor market taking into account
regional peculiarities and specifics of the business spheres;
Considering in an obligatory manner material
and non-material needs and interests of the employees when elaborating the labor remuneration
and compensation system;
Strengthening the Company’s image as a responsible and reliable employer.
The Company utilizes approaches that are unified
across all branches for labor remuneration and compensation. Compensation is determined based on
evaluating the position of the complexity of activities,
qualifications and the impact on the fundamental
results of the Company’s operation. A correlation between the fixed and variable portion of compensation
is estimated depending on the character of activities
and the degree of impact on the result.
164
Sustaining the deserved level of material well-being
for the Company’s personnel contributes to attracting
and retaining particularly valuable and highly professional employees, thus forming a solid basis for the
Company’s economic effectiveness as a whole.
Awards Policy
With the goal of offering moral and material incentives
for employees to achieve strong labor results,
Federal Grid Company has implemented a Program
to encourage employees with state, departmental,
industry and corporate awards.
The awards system in effect decorates employees
with State awards, awards from the Russian Government, awards from the Russian Ministry of Energy,
from the Industrial Union of Power Industry Employers,
as well as with corporate awards – the title of the
FEDERAL GRID COMPANY
Honorary Employee of Federal Grid Company of the
first and second degree, the award “For Professional
Skill,” the award “For the Construction and Reconstruction of Electric Grid Objects,” the Honors Board,
the Honorary Certificate and Honorable Mention.
Employees from the branches of Federal Grid Company, which demonstrated the greatest equipment
reliability, achieved better production indicators and
the strongest results in implementing and introducing
new equipment and technology as of end of the year
receive the title of the Best Branch of Federal Grid
Company – MES and the Best Enterprise of Federal
Grid Company – PMES.
•
•
•
•
•
•
•
In 2010 for services to the State, Vladimir Taskin,
Director of Federal Grid Company’s Khakassia
PMES branch received the title “Honorary power
engineer of the Russian Federation.”
25 Federal Grid Company employees received
awards from the Russian Government;
For services to the power industry 331 employees received awards from the Russian Ministry
of Energy;
52 individuals received awards from the AllRussian Industrial Union of Power Industry Employers;
In 2010 for merit and input into the development
of Federal Grid Company 12 collectives of contracting organizations received corporate awards
from Federal Grid Company;
1,148 employees received corporate awards;
For professionalism demonstrated when addressing the accident at the Sayano-Shushenskaya
HPP, 16 employees received commendations
from RusHydro.
Personnel Training and Development
Each of the Company’s employees is involved in the
corporate training system with the aim of upgrading
the level of professionalism and the development of
employees’ internal potential.
Types of training in 2010:
•
Mandatory training, which is conducted once every three years and provides for employee training in the field of labor protection and industrial
safety, as well as other training for production
ANNUAL REPORT
2010
•
•
personnel in accordance with requirements and
work conditions;
Career enhancement, including intensive management training in accordance with innovative
programs, conducted based on specialized educational centers;
Foreign placement.
In 2010 10,511 persons were involved
in various types of training, which
is 47.85% of the overall average head
count of the Company’s personnel.
During 2010 new training programs were developed and introduced for the following personnel
categories:
1.
Training of industrial and production personnel
accounts for the largest portion of implemented
programs, has a mandatory character and is
regulated by the Guidance on working with personnel in power sector organizations. In 2010
8,277 different categories of production personnel from MES branches underwent training,
of this number, 1,898 represent dispatch personnel and 3,702 maintenance personnel;
2.
Training under the auspices of the program
“Ensuring Environmental Safety by Managers
and Specialists of General Economic Management Systems.” The program was implemented
in the shortest time possible due to a new training format – the video-conference seminar, which
allowed the Company to reach the most distant
MES branches. 325 persons participated in
video-conference seminars;
Foreign placement in England, Spain, Germany,
Denmark and Norway with the goal of familiarizing employees with experience from
the operation of power industry complex;
3.
4.
Young Engineer School, a program of educational
and practical seminars organized by MES Center
together with lecturers of the Moscow Power
Engineering Institute, for final-year students of
the Moscow Power Engineering Institute and the
Ivanovo State Energy Institute;
165
6.0
ABOUT THE COMPANY
PRODUCTION OVERVIEW
INVESTMENTS AND INNOVATIONS
ECONOMIC AND FINANCIAL PERFORMANCE
CORPORATE GOVERNANCE
SOCIAL RESPONSIBILITY
Training substation directors in accordance
with the unified system of personnel training
and development;
5.
6.
Intensive management training in accordance
with innovative programs in 2010 included training all categories of the Company’s executive
personnel. The course for junior management,
in which 112 employees took part, was aimed at
developing basic managerial competencies and
skills. Training the Company’s mid-level managers was aimed at upgrading the knowledge
level in the subject of “Economy and management of the energy company.” As part of training measures for top executive managers, 89
corporate managers received training in the following areas: Strategic Leadership: Managing
Personnel and Teams, Strategic Changes Based
on the Skolkovo Moscow Management School;
Creation of a distance educational system for
production and managerial personnel organized
as part of the implementation of a program of
training and career enhancement in a rapidly
changing business environment for a geographically spread out company. Distance educational
courses were developed in the following areas:.
•
Training users in the corporate information
management system: working in an automated system of managerial document flow;
•
Liquidating technological breaches at Federal
Grid Company’s objects.
166
7.
Project to create training centers for production
personnel in MES branches.
In 2010 in all corporate branches the Company
started creating training centers. Federal Grid Company developed its own system of training specialists including training classes and training simulator
classes. The Company also conducts seminars and
lectures, which are led either by invited specialists or
the Company’s in-house experts.
Non-Governmental Pension Provision
With the aim of ensuring an appropriate standard
of living for the Company’s employees at pension
age, as well as to increase employees’ motivation
to work effectively and to attract and retain highly
qualified personnel, Federal Grid Company has adopted a Program for the non-governmental pension
provision to employees. Its main principles include a
unified approach to setting the amount of the nongovernmental pension and stimulating employees for
the merits of the Company and the power industry, as
well as for longstanding and conscientious work.
During the period of activity, the Program of
non-governmental pension was granted to 2,760
employees from Federal Grid Company funds.
On the whole, in accordance with the norms of the
Regulation on non-governmental pension provision to Federal Grid Company employees in 2010,
RUR261,626,611 was transferred to the non-governmental pension fund of the power industry.
FEDERAL GRID COMPANY
ANNUAL REPORT
2010
6.3 ENVIRONMENT
Environmental safety holds an important place in Federal Grid Company’s
activity. The Company implements its environmental strategy based
on the environmental doctrine of the Russian Federation, Federal Grid
Company's environmental policy and taking into account opinions
of the leading environmental protection organizations.
Electricity transmission – the main type of our activity – has a significantly smaller environmental impact
compared with other power industry branches. Electrical grid specifics in respect to impact on the surrounding environment is that emissions, discharges
and waste products are not the result of technological processes, but appear as a result of economic
activity and are characterized by very low level values
relative to maximum permissible values. Thus, atmospheric emissions for all types of contaminating
materials are 2-3 times lower than the maximum allowable contamination level, and discharges are only
rainflow overflow. Contamination volume is also very
insignificant. Thus, in 2010 the released volume for
all substations totaled 75.5 tons and the volume of
waste products for I-V classes of hazardous material
is less than 10 thousand tons.
Despite these low indicators for negative environmental impact Federal Grid Company pays significant
attention to environmental issues. While designing
new objects, the Company elaborates on special environmental protection sections taking into account all
requirements of Russian environmental regulations.
Construction and re-construction projects for electric
grid objects undergo state expert review and public
consultations are held to evaluate environmental
impact. Particular attention is paid by the Company
to informing the public on ensuring the environmental safety of socially important projects, such as the
construction of electric grid objects as part of the
preparation for the 2014 Sochi Winter Olympics and
the 2012 APEC Summit in Vladivostok.
The Company acts in accordance with the Environmental Policy adopted by the Board of Directors
Trichlorodiphenyl
In the previous century, trichlorodiphenyl
was widely used as a liquid dielectric during
the production of power transformers and
condensers due to its exceptional thermophysical and dielectric characteristics,
fire-resistance and explosion safety. At the
same time, trichlorodiphenyl is a persistent
organic pollutant and belongs to the first
class of hazards.
in 2008. It aims to improve environmental safety, ensuring the reliable and ecologically safe transmission
and distribution of energy. Within this program, the
Company undertakes technical and organizational
measures to minimize the negative impact of production on the surrounding environment.
Technical measures include replacing equipment
containing hazardous and toxic substances, repairing
systems and oil container devices, organizing temporary landfill sites and constructing and reconstructing
of canalization and disposal facilities, as well as other
measures.
The Company pays particular attention to managing especially hazardous waste. The Company has
a license to collect, use, deactivate, transport and
emplace hazardous waste.
In 2008 the Company began to implement a target program on replacing and utilizing equipment
167
6.0
ABOUT THE COMPANY
PRODUCTION OVERVIEW
INVESTMENTS AND INNOVATIONS
ECONOMIC AND FINANCIAL PERFORMANCE
CORPORATE GOVERNANCE
SOCIAL RESPONSIBILITY
containing trichlorodiphenyl. In the previous century,
trichlorodiphenyl was widely used as a liquid dielectric
during the production of power transformers and
condensers due to its exceptional thermo-physical
and dielectric characteristics, fire-resistance and
explosion safety. At the same time, trichlorodiphenyl
is a persistent organic pollutant and belongs to the
first class of hazards.
.
The program to realize Federal Grid Company’s
environmental policy calls for replacing and utilizing
equipment containing trichlorodiphenyl. In the process
of the reconstruction and technical rehabilitation of
objects of the UNEG, this equipment is replaced on a
mandatory basis. One-fourth of equipment containing
trichlorodiphenyl has been already dismantled and
utilized.
Within the framework of the Technical policy, we
replace condensers containing trichlorodiphenyl
with condensers permeated with environmentally
safe dielectric liquid. The dismantled condensers
are transferred for utilization to specialized
organizations.
Organizational measures include implementing an
environmental management system that corresponds
with requirements of international standard ISO
14001, introducing a system of environmental
production control and conducting environmental
audits and environmental training of personnel, as well
as upgrading documentary support of environmental
protection activities.
In 2010 all corporate branches conducted internal
environmental audits. The audit controlled: the
observance of environmental protection legislation,
the completeness and condition of environmental
documentation and the technical condition of
environmental facilities. The Company analyzed
problems arising in the process of the branches’
environmental protection activities. Based on audit
results, the Company developed a programs of
measures to upgrade the efficiency of the Company
and its branches’ environmental protection activities.
In 2010, the Company conducted environmental
training of its personnel:
•
In 2010 Federal Grid Company utilized 4,036 static
condenser jars with a total weight of 167 tons. For
2011 the Company plans to utilize approximately
10,000 static condenser units.
•
•
In 2002 the Russian Government ratified the Stockholm Convention. So it
must fully cease using equipment containing trichlorodiphenyl on its territory
by 2025. In accordance with obligations
undertaken by the country, the Company
plans to fully withdraw equipment containing trichlorodiphenyl from operation
by 2025.
168
Appropriate handling of I-IV class hazardous
waste (134 corporate employees participated
in training);
Environmental protection and safety training
for executives and specialists (128 corporate
employees participated in training).
In 2010 Federal Grid Company developed and
adopted the Instruction on the Procedure of
Inventory of Production and Consumption Waste
in Federal Grid Company’s MES and PMES
Branches, setting a unified order for inventorying production and consumption waste and filing
documents on inventory results for all corporate
branches. Also, the Company developed and introduced new annual forms for environmental
protection measures and quarterly reports on
quantitative and qualitative indicators for negative environmental impact.
FEDERAL GRID COMPANY
•
Since 2008 the Company has conducted environmental monitoring in the zone of passing of
the 500 kV high voltage line on the territory of
Smolny National Park (the Republic of Mordovia),
which is located in the zone of activity of the
Nizhegorodsky PMES. The goal of monitoring is
to evaluate the degree of impact of the 500 kV
high voltage line on animals and to develop
recommendations to prevent their deaths, as
well as rehabilitation and long-term development
of ornithological complexes in the zone of high
voltage lines. Based on data gathered in 2010,
the monitoring program will be updated.
ANNUAL REPORT
2010
Electricity transmission – the
main type of our activity –
has a significantly smaller
e n v ir o n m e n t a l
i m p ac t
compared with other power
industry branches.
In 2011 the principal objectives of Federal
Grid Company in the environmental protection sphere include:
•
•
•
•
Fulfilling technical measures in a timely and qualitative manner to minimize negative environmental
impact;
Implementing Federal Grid Company’s environmental management system in accordance
with the ISO 14001 standard;
Conducting internal environmental audits in the
Company’s branches;
Developing quantitative target values in environmental protection and enacting measures for their
achievement.
169
6.0
ABOUT THE COMPANY
PRODUCTION OVERVIEW
INVESTMENTS AND INNOVATIONS
ECONOMIC AND FINANCIAL PERFORMANCE
CORPORATE GOVERNANCE
SOCIAL RESPONSIBILITY
6.4 PRODUCTION SAFETY
Labor Protection
We aim to provide safe working conditions for our
employees. The Company’s goals in this sphere include nullifying production accidents and professional
illnesses, ensuring accident-free operation via the
introduction of highly effective technologies and
modern equipment, upgrading the quality of labor
conditions at work sites and ensuring a high production culture.
The Company conducted semi-monthly labor
protection events prior to the start of the 2010
maintenance campaign, during which Federal Grid
Company performed demonstrative admissions of
brigades to work at power facilities, conducted a
unified labor protection day with the subject “Risk
management and injury prevention during the
organization of work at high voltage lines” and
introduced a system to prevent the breach of labor
safety rules during power facility work.
In 2010 work in the labor protection sphere was
conducted in accordance with a series of tasks, determined by resolutions of the Labor Protection Council,
as well as the Company’s organizational and management documents.
The Company developed and introduced the order of
organizing heightened danger work and a risk management system in the labor protection sphere to
prevent and avoid injuries and professional illnesses
at production, to create favorable working conditions
and to ensure the high reliability and effectiveness of
personnel’s work.
The Company continued work to conduct psychophysiological testing to select operative and technical
personnel, as well as to create psychological release
rooms for substation employees.
The Company created a Pilot Project to conduct preshiſt medical examinations using remote equipment
to detect employees’ health issues and to adopt measures to decrease the impact of the human factor on
the reliability of electric grid operation.
As a result of injury prevention work
carried out by the Company in 2010, the
number of accidents during work at high
voltage lines decreased 67% year-onyear. The number of injuries for contractor
organization specialists working at the
UNEG objects dropped 62%.
Industrial Safety
In 2010 Federal Grid Company had 297 hazardous
industrial facilities (HIFs) in operation. To secure
the industrial safety of these objects, the Company
undertook measures aimed at preventing HIF
accidents and ensuring the readiness for localizing
and liquidating the consequences of these indicated
accidents, including:
•
•
The Company held a review contest for the best
organization of labor protection work among
corporate branches.
170
Insuring Federal Grid Company’s liability for causing harm to life, health and/or property of other
parties and the surrounding environment in the
case of an HIF accident;
Receiving a positive appraisal from the industrial
safety commission of experts on objects’ compliance with industrial safety requirements of the
Federal Environmental Industrial and Nuclear
Supervision Service of Russia;
FEDERAL GRID COMPANY
•
•
•
Receiving license No.VP-00-012123(K), dated 11
November, 2010, on activities to exploit explosion-hazardous production facilities;
Organizing production control of the observance
of industrial safety requirements at the Company’s HIFs;
Conducting training and the certification of personnel in the industrial safety field;
In 2010 no accidents and incidents were
registered at the Company’s HIFs. There
was no damage from accidents and
incidents at the Company’s HIFs.
ANNUAL REPORT
2010
Fire Safety
During 2010 at Federal Grid Company facilities there
were 12 technological breaches accompanied with
fire in substation equipment.
On a semi-annual basis, Federal Grid Company personnel participated in fire-fighting training and exercises
conducted by the Company together with divisions of
fire protection services of the Russian Civil Defense
Ministry. Company employees learn fire safety basics in
a timely manner and undergo fire protection instruction
and complete fire safety knowledge tests.
In 2010 the Company received license from the Russian
Civil Defense Ministry on activities for installing, repairing and servicing fire safety means for buildings and
constructions No.8-2/02172 dated 15 October, 2010.
171
ATTACHMENTS
MOVING FORWARD
WITH NEW ENERGY
ANNUAL REPORT
2010
2010 RAS FINANCIAL
STATEMENTS
AND AUDIT REPORT
AUDIT REPORT
FOR 2010
Federal Grid Company of the
Unified Energy System (FGC UES)
Audit Report for 2010
174
FEDERAL GRID COMPANY
ANNUAL REPORT
2010
Audit Report
To shareholders of Federal Grid Company of the Unified Energy System (FGC UES)
Information about the Audited Entity
Name:
Open Joint Stock Company “Federal Grid Company”
State Registration:
State registration certificate No. 21081 series LO-002 issued by the Leningrad Region Registration Chamber on 25
June, 2002, registered and included into a register under No. 00/03124.
Certificate of inclusion in the Unified State Register of Legal Entities, regarding the legal entity registered prior to
1 July, 2002 under basic State registration No. 1024701893336, as issued by the Inspectorate of the Russian
Ministry of Taxes and Duties of the Tosnensky District of the Leningrad Region on 20 August, 2002.
Registered Office:
5а Akademika Tchelomeya Street, Moscow, Russia, 117630
Information about the Audit Company
Name:
Closed Joint Stock Company “PricewaterhouseCoopers Audit“ (ZAO “PwC Audit”)
Registered Office:
10 Butyrsky Val Street, Moscow, Russia, 125407
State Registration:
State registration certificate No. 008.890 issued by Moscow Registration Bureau on 28 February, 1992.
Certificate of inclusion in the Unified State Register of Legal Entities, regarding the legal entity registered prior to
1 July, 2002 No. 1027700148431, as issued by the Inter-regional Inspectorate of the Russian Ministry of Taxes and
Duties No. 39 for Moscow City on 22 August, 2002.
Information on the auditor’s membership in self-regulated organizations:
Member of the Not-for-Profit Partnership Audit Chamber of Russia (ACR), a self-regulated association of auditors,
registration No. 870 in the ACR Register of members.
Basic registration No. 10201003683 in the State Register of Auditors and Audit Organizations.
Closed Joint Stock Company “PricewaterhouseCoopers Audit“ (ZAO “PwC Audit”)
10 Butyrsky Val Street, Moscow, Russia, 125407
Tel: +7 (495) 967-6000, Fax:+7 (495) 967-6001, www.pwc.ru
2 /4
175
Audit Report
To shareholders of Federal Grid Company of the Unified Energy System (FGC UES):
We have audited the attached financial (accounting) reports of Open Joint Stock Company “Federal Grid Company
of the Unified Energy System” (hereinafter referred to as “the Company”) consisting of the Accounting Balance
Sheet as of 31 December, 2010, Profit and Loss Statement, Statement of Changes in Stockholder’s Equity, Cash
Flow Statement, Notes to the Accounting Balance and Explanatory Notes (hereinafter, all the reports together are
called “Financial (accounting) reports”).
The Company's responsibility for Financial (accounting) reports
The Company’s executive body is responsible for the preparation and accuracy of the Financial (accounting)
reports in compliance with accounting procedures established in the Russian Federation, accounting requirements
and the internal control system necessary for the preparation of the Financial (accounting) reports free of material
misstatements resulting from malpractice or errors.
Audit Company responsibility
Our responsibility is to express an opinion on the fairness of the financial statements on the basis of our audit. We
conducted our audit in accordance with the Federal Standards on Auditing and International Auditing Standards.
These standards require complying with applicable ethical norms, as well as planning and conducting the audit in
a manner that allows us to obtain reasonable assurance about whether the Financial (accounting) reports are free
of material misstatements.
The audit includes conducting audit procedures aimed at receiving audit evidence supporting the amounts and
disclosures in the Financial (accounting) reports. The selection of audit procedures is a subject of our assessment
based on the estimated risk of material misstatements resulting from malpractice or errors. During the process of
this risk assessment, we considered the internal control system providing preparation and accuracy of the
Financial (accounting) reports for the purpose of selecting the appropriate audit procedures, but not for expressing
an opinion on the efficiency of the internal control system. The audit also includes an assessment of compliance
with accounting principles, an evaluation of significant estimates made by the management of the Company and
the overall Financial (accounting) reports presentation. We believe that our audit provides a reasonable basis for
our opinion on the fairness of the Financial (accounting) reports.
Closed Joint Stock Company “PricewaterhouseCoopers Audit“ (ZAO “PwC Audit”)
10 Butyrsky Val Street, Moscow, Russia, 125407
Tel: +7 (495) 967-6000, Fax:+7 (495) 967-6001, www.pwc.ru
176
3 /4
FEDERAL GRID COMPANY
ANNUAL REPORT
2010
Opinion
In our opinion, the financial (accounting) reports of the Company attached to this report have been properly
prepared to present, in all material respects, the financial position of the Company as of 31 December, 2010, its
financial and operating results and cash flow in accordance with Russian Accounting Standards.
Director, PricewaterhouseCoopers Audit
29 March, 2011
Closed Joint Stock Company “PricewaterhouseCoopers Audit“ (ZAO “PwC Audit”)
10 Butyrsky Val Street, Moscow, Russia, 125407
Tel: +7 (495) 967-6000, Fax:+7 (495) 967-6001, www.pwc.ru
Vyacheslav Sokolov
4/4
177
BALANCE
SHEET
FOR 2010
to the Order
of Ministry
of Finance of the
BALANCE SHEET
Russian Federation
as of
December 31
2010
dated 22.07.2003
No. 67ɧ
CODES
Form No. 1 according to the All-Russian
Classifier of Management Documentation
0710001
Date (year, month, day) 2010 12
31
Organization
Open Joint Stock Company
Federal Grid Company of Unified Energy System
according to the All-Russian National Classifier
56947007
of Businesses and Organizations
Taxpayer identification number
TIN
Type of activity
Power transmission according to the All-Russian Classifier of Types of
Economic Activity
Form of incorporation / Form of ownership
Open Joint Stock Company / mixed ownership with federal state share
according to All-Russian Classifier of Forms of Ownership /
All-Russian Classifier of Forms of Incorporation
Measurement unit
ths. rub. according to the All Russian Classifier of Measurement Units
Location (address)
40.10.2
47
41
384/38
5A, Akademika Chelomeya st., Moscow, 117630
Date of approval
Send/acceptance date
ASSET
1
I. FIXED ASSETS
Intangible asset including:
rights to patents, programs, logotypes and other similar
other kinds of intangible assets
Capital assets
including:
Land plots and nature management facilities
Buildings, machine and equipment, structures
Other types of capital assets
Construction in progress (uncompleted construction)
including:
Equipment to be installed
Investments in fixed assets
Income-bearing investments in material valuables
Long-term financial investments
Deferred tax assets
Other fixed assets
TOTAL for Section I
II. CURRENT ASSETS
Inventory including:
raw stocks, materials and other similar values
investments in production in process (uncompleted)
finished goods and goods for resale
deferred expenses
other inventories and investments
Value-added tax for acquired values
Accounts receivable (payments expected in more than
12 months period from the reporting date)
including:
buyers and customers
Advance payments paid
other debtors
Accounts receivable (payments expected within 12 months
period from the reporting date) including:
buyers and customers
Contributions to the authorized capital unpaid by
participants (incorporators)
Advance payments paid
other debtors
Short-term financial investments
Cash in banks and on
hand
cash on hand
Bank accounts
Foreign currency accounts
Monetary instruments:
Other cash
Other current assets
TOTAL for Section II
BALANCE
178
4716016979
Index
Code
2
21.03.2011
As of the beginning of
reporting period
3
As of the end
of reporting period
4
110
1 396 257
917 625
111
112
977 021
419 236
696 044
221 581
120
237 753 751
236 193 167
121
122
123
156 495
235 778 695
1 818 561
827 221
232 958 699
2 407 247
130
216 529 585
298 644 138
131
132
135
140
145
150
190
18 484 815
198 044 770
–
66 970 387
–
1 415 088
524 065 068
17 905 969
280 738 169
–
104 137 547
–
894 579
640 787 056
210
2 427 514
4 632 226
211
213
214
216
217
220
2 262 155
–
29 993
135 366
–
2 070 794
4 407 467
–
30 011
194 748
–
2 295 467
230
20 492 819
8 696 249
231
234
235
185 910
36
20 306 873
68 106
–
8 628 143
240
117 170 891
157 647 614
241
8 949 413
–
8 669 641
67 036 337
41 185 141
69 120 125
11 312 141
97 636 854
51 341 119
46 244 024
242
243
244
250
260
261
262
263
264
265
270
290
300
2 439
11 305 731
–
–
11 243 302
3 962
3 664
11 233 055
–
1
6 582
222 601 884
746 666 952
230 758 882
871 545 938
FEDERAL GRID COMPANY
ANNUAL REPORT
2010
LIABILITIES
1
III. CAPITAL AND RESERVES
Registered capital
Own shares acquired from shareholders
Index
Code
2
Form 0710001 p. 2
As of the end
of reporting period
4
As of the beginning
of reporting year
3
410
576 757 098
–
–
Added capital
Reserve capital
Previous years' uncovered loss
Unappropriated profit of previous years
411
420
430
460
465
147 596 367
10 134 044
(68 870 025)
147 465 640
10 134 044
(68 584 944)
Unappropriated profit of reporting year
470
58 088 388
Unappropriated losses of reporting year
475
490
–
–
–
665 617 484
763 883 795
510
6 000 000
50 000 000
515
520
590
1 435 064
5 098
7 440 162
2 649 711
18 179
52 667 890
TOTAL for Section III
IV. LONG-TERM LIABILITIES
Borrowings and credits
Deferred tax liabilities
Other long-term liabilities
TOTAL for Section IV
V. SHORT-TERM LIABILITIES
Borrowings and credits
Accounts payable including:
suppliers and contractors
organization personnel liabilities
state non-budgetary funds liabilities
taxes payable
Advance payments received
other creditors
Income payments payable to members (incorporators)
Deferred revenue
Reserves for costs to be incurred
Other short-term liabilities
TOTAL for Section V
BALANCE
REFERENCE to the values, registered in off balance
sheet accounts
Leased fixed assets
Including those under lease
Material assets accepted for safe custody
Consigned goods
Written off debts of insolvent debtors
Received liabilities and payments securities
Given liabilities and payments securities
Housing funds depreciation
Depreciation of external public facilities and other
similar facilities
Intangible assets received
Work clothes
D.A. Troshenkov
Managing Director
signature
–
–
610
7 481 469
6 941 422
620
621
622
623
624
627
625
630
640
650
660
690
700
65 802 620
11 018 708
134 473
18 906
653 884
7 114 653
46 861 996
46 898
278 319
–
–
73 609 306
746 666 952
47 727 617
14 017 237
193 318
36 486
865 113
11 476 694
21 138 769
46 898
278 316
–
–
54 994 253
871 545 938
910
6 189 371
13 693 765
911
920
–
–
633 348
638 163
930
940
950
960
–
–
414 819
70 943 984
30 815
557 510
115 203 743
30 815
970
–
63
980
–
–
–
–
–
–
11
19
990
991
1000
Registered high-security forms
616 780 667
Chief accountant
signature
V.V. Schukin
(name)
21st of March 2011
Auditor
_____
179
PROFIT AND LOSS
STATEMENT
FOR 2010
Appendix to the Order
of Ministry of Finance
of the Russian
Federation dated
22.07.2003 No. 67ɧ
PROFIT AND LOSS STATEMENT
For 2010
CODES
Form No. 2 according to All-Russian Classifier
of Management Documentation
Date (year, month, day)
Organization
0710002
2010
Open Joint Stock Company
Federal Grid Company of Unified Energy System
12
31
56947007
according to the All-Russian National Classifier of Businesses and Organizations
Taxpayer identification number
TIN
Type of activity
Power transmission according to the All-Russian Classifier of Types of
4716016979
40.10.2
Economic Activity
Form of incorporation / Form of ownership
47
41
Open Joint Stock Company / mixed ownership with federal state share
according to All-Russian Classifier of Forms of Ownership /
All-Russian Classifier of Forms of Incorporation
Measurement unit: ths. rub according to the All Russian Classifier of Measurement Units
Item
description
1
Income and expenditures as per common activities
Sales (net) revenues as per goods, production, works, services
(ex VAT, excise taxes and similar compulsory payments)
including
Power transmission services
other activity
Cost value of sold goods, production, works and services
including:
Power transmission services
other activity
Gross margin (010 + 020)
Business expenses
Administrative expenses
Sales profit (losses) (029 + 030 + 040)
Other income and expenditures
Interest to receive
Interest to pay
Income from shareholding in other organizations
Other revenues
Other expenditures
Profit (losses) prior to taxation
(050 + 060 + 070 + 080 + 090 + 100)
Conventional cost of profit tax (140 × 20 %)
Constant tax liabilities
Deferred tax assets
Deferred tax liabilities
Current profit tax (143+200-141-142)
Other similar mandatory payments
Adjustment of profit tax in previous tax periods
Net profit (losses) for the reporting period (140 + 143 + 200 +
151 + 152) or (140 + 141 + 142 + 150 + 151 + 152)
FOR REFERENCE ONLY:
Basic earnings (losses) per share
Diluted earnings (losses) per 100 000 000 shares
180
Code
2
384/385
For reporting period
3
For the same period
of the preceding year
4
010
111 084 675
85 077 809
011
012
109 510 275
1 574 400
80 173 317
4 904 492
020
(75 518 397)
(64 079 927)
021
022
029
030
040
050
(74 694 570)
(823 827)
35 566 278
–
(6 209 146)
29 357 132
(62 732 093)
(1 347 834)
20 997 882
–
(5 128 305)
15 869 577
060
5 436 238
7 291952
070
080
090
100
(273 751)
422 310
142 534 195
(109 157 601)
(1 717 506)
717 256
105 760 531
(181 970 591)
140
68 318 523
(54 048 781)
143
200
141
142
150
151
152
(13 663 705)
3 184 752
(33 442)
(1 181 205)
(9 264 306)
43 226
205 592
10 809 756
(16 588 331)
(180 217)
(722 009)
(4 876 349)
(4 642)
(33 996)
190
58 088 388
(69 865 994)
201
202
4 760
–
–5 190
FEDERAL GRID COMPANY
ANNUAL REPORT
2010
INTERPRETATION OF CERTAIN PROFITS AND LOSSES
Index
For reporting period
Description
1
Confirmed fines, penalties
and forfeits, and those upon
which a decision of
(arbitration) court has been
taken to be collected
Code
2
230
495 902
31 922
397 323
40 390
Previous years' profit (loss)
Indemnity for losses caused
by non-fulfillment or
inadequate fulfillment of
obligations
240
320 195
229 331
412 431
521 681
250
–
–
–
–
260
10 970
10 017
26 455
15 949
270
×
18 611 054
×
9 404 732
280
185
142 486
6 556
9 122
Exchange difference with
foreign currency operations
Allocations to assessed
reserves
Receivables and payables
writing off for which the
period of limitation has
expired
Managing Director
profit
3
For the same period of the preceding year
D.A. Troshenkov
loss
4
profit
5
Chief accountant
signature
signature
loss
6
V.V. Schukin
(name)
21st of March 2011
Stamp:
Annex to the audit review executed by ZAO PricewaterhouseCoopers Audit
21st of March 2011
Auditor__________________
181
STATEMENT OF CHANGES
IN STOCKHOLDER’S EQUITY
FOR 2010
Supplement
to Order of the Ministry of Finance
of the Russian Federation
dated 22.07.2003 No. 67n
STATEMENT OF CHANGES IN
STOCKHOLDER’S EQUITY
“Federal Grid Company
of Unified Energy System”,
JOINT-STOCK COMPANY
Power transmission
Open Joint Stock Company/mixed ownership
with federal state share
ths. rub.
Index
Description
1
Balance as of December 31 of the
year preceding the previous one
2009
(previous year)
changes in accounting
policy
Result from reassessment of fixed
asset items
Changes in accounting rules
Balance as of January 1
of the preceding year
Result from recalculation of foreign
currencies
Net profit
Dividends
Allocations to reserve fund
Increase of capital amount due to:
additional emission of shares
increase of nominal
share value
reorganization of legal entity
miscellaneous
Reduction of capital amount due to:
decrease of nominal share value
decrease of shares quantity
reorganization of legal entity
miscellaneous
own shares acquired from
shareholders
Balance as of December 31
of the preceding year
2010
(reporting year)
Changes in accounting policy
Result from reassessment of fixed
asset items
Changes in accounting rules
Demand balance as of January 1
of the reporting year
Result from recalculation of foreign
currencies
Net profit
Dividends
182
Code
1. Changes in Capital
Added capital
Registered
capital
CODES
Form No. 3 according to the AllRussian Classifier of Management
0710003
Documentation
Date (year, month, day) 2010 12
31
according to the All-Russian National
Classifier of Businesses and
56947007
Organizations
TIN
4716016979
All-Russian Classifier of Types of
40.10.2
Economic Activity
according to All-Russian Classifier of
47
41
Forms of Ownership/All-Russian
Classifier of Forms of Incorporation
384/385
Reserve
capital
4
5
Unappropriated
balance
(uncovered
losses)
6
Total
2
3
010
576 757 098
52 597 360
9 910 770
26 912 201
166 177 429
7
011
X
X
X
(33 836 387)
(33 836 387)
012
X
6 905 053
X
(20 914)
6 925 967
013
X
í
X
103 572
103 572
020
576 757 098
59 502 413
9 910 770
(6 841 528)
639 328 753
023
X
í
X
X
í
025
026
030
040
041
X
X
X
0
X
X
223 274
(59 865 994)
(59 865 994)
í
í
í
í
X
X
X
0
X
042
í
043
044
050
051
052
053
054
í
í
í
í
í
í
í
4 644
X
(223 274)
4 644
X
X
X
X
í
í
í
í
í
4 644
115 761
X
X
4 644
(115 761)
X
X
X
(115 761)
í
í
X
X
X
í
í
115 761
í
í
í
í
í
í
055
í
í
í
í
í
060
576 757 098
59 386 652
10 134 044
(66 810 391)
579 467 403
061
X
X
X
í
í
062
X
88 209 715
X
(2 059 634)
86 150 081
063
X
í
X
100
576 757 098
147 596 367
10 134 044
68 870 025
665 617 484
103
X
í
X
X
105
106
X
X
X
X
X
X
58 088 388
í
58 088 388
FEDERAL GRID COMPANY
ANNUAL REPORT
2010
Form 0710003 p. 2
1
Allocations to reserve fund
Increase of capital amount due to:
additional emission of shares
Increase of nominal share
value
reorganization of legal entity
miscellaneous
own shares acquired from
shareholders
Reduction of capital amount due to:
decrease of nominal share value
decrease of share quantity
reorganization of legal entity
miscellaneous
Balance as of December 31
of the reporting year
2
110
120
121
3
4
5
6
X
40 023 569
40 023 569
X
154 354
X
í
X
X
í
í
X
7
í
40 177 923
40 023 569
122
í
X
X
X
í
123
124
í
í
X
154 354
X
í
X
í
í
154 354
125
í
í
í
í
í
130
131
132
133
134
í
í
í
í
í
(285 081)
X
X
X
(285 081)
X
X
X
X
í
285 081
X
X
í
285 081
í
í
í
í
í
140
616 780 667
147 465 640
10 134 044
(10 496 556)
763 883 795
Received
Allocated
5
II. Reserves
Index
Description
1
Reserves accumulated in accordance with
the legislation:
Data on the reporting year
stock, accumulated in accordance
with the constitutive documents
Data on the reporting year
Assessed reserves:
Reserve for doubtful debts
(reserve description)
Data on the reporting year
Reserve for devaluation of financial investments
(reserve description)
Data on the reporting year
Reserve for decline in material values
(reserve description)
Data on the reporting year
Index
Description
1
1) Net assets
2) Received for:
common activity costs – total
including:
payments to Chernobyl liquidators
capital investments in non-current assets
miscellaneous
Balance
Balance
Code
2
3
4
150
9 910 770
223 274
151
10 134 044
í
í
10 134 044
152
í
153
í
í
í
í
160
161
35 422 113
21 306 841
5 902 136
14 036 443
(20 017 408)
(20 897 766)
21 306 841
14 445 518
162
163
5 164 814
8 667 335
3 502 596
3 913 434
(75)
(499)
8 667 335
12 580 270
164
165
í
í
í
í
í
(661 177)
661 177
Code
2
200
References
Balance as of the
beginning of
reporting year
3
665 895 803
From budget
For the reporting
For the
year
preceding year
6
10 134 044
Balance as of the end
of reporting year
4
764 162 111
From non-budget funds
For
For the preceding year
the reporting
year
5
6
3
4
210
í
í
90
119
211
í
í
í
í
220
230
í
í
í
í
í
90
í
119
"29" _______ March,_____ 2011
183
CASH FLOW
STATEMENT
FOR 2010
Supplement to Order of the Ministry
of Finance of the Russian
Federation
dated 22.07.2003 No. 67n
CASH FLOW STATEMENT
CODES
Form No. 4 according to the All0710003
Russian Classifier of Management
Documentation
Date (year, month, day) 2010 12
31
according to the All-Russian National
Classifier of Businesses and
56947007
Organizations
TIN
4716016979
All-Russian Classifier of Types of
40.10.2
Economic Activity
according to All-Russian Classifier of
Forms of Ownership/All-Russian
47
41
Classifier of Forms of Incorporation
384/385
for 2010
“Federal Grid Company
of Unified Energy System”,
JOINT-STOCK COMPANY
Organization
Taxpayer identification number
Power transmission
Type of activity
Form of incorporation/Form of ownership
Open Joint Stock Company/mixed
ownership with federal state share
ths. rub.
Unit of measurement
Index
Description
1
Cash funds balance as of the beginning of reporting year
Cash flow as per current activity
Cash receipts from buyers and/or customers
Receipts of acquired foreign currency
Receipts from insured accidents
Other revenues
Cash paid for:
purchased goods, works, services, raw stock and other current
assets
labor compensation
for payment of dividends, interest
taxes and receipts payments
for insured accidents
for other expenses
Net cash generated from current activity
Cash flow as per investment activity
Sales revenue as per items of fixed assets and other capital assets
Sales revenues as per securities and other financial assets
Dividends received
Interest received
Revenues from repayment of loans, made to other
organizations
Other revenues
Cash paid for:
acquisition of associated companies
acquisition of fixed assets items, income-bearing placements in
material values and intangible assets
acquisition of securities and other financial assets
loans, made to other organizations
for other expenses
Net cash per investment activity
184
2
010
3
11 312 132
For the same period
of the preceding
year
4
5 640 051
020
030
040
05\0
133 188 863
649 385
–
12 347 308
94 010 235
290 642
–
13 414 676
150
(38 168 553)
(43 950 985)
160
170
180
181
190
200
(11 749 439)
(724 760)
(13 727 359)
–
(5 907 128)
75 908 317
(5 589 044)
(2 122 038)
(6 142 236)
–
(2 185 427)
47 725 823
210
220
230
240
1 111 437
179 538 445
528 599
1 796 274
307 731
276 911 503
860 603
3 118 353
250
–
–
260
492 432
–
290
(167 831 053)
(99 466 324)
300
(145 192 282)
310
320
340
(59 804)
(129 615 952)
(235 405 935
(6 653)
(7 611)
Code
For the reporting
period
280
(8 499 011)
(62 187 3441
FEDERAL GRID COMPANY
1
Cash flow as per financial activity
Revenues from emission of shares and other equity securities
Revenues from loans and borrowings, made by other
organizations
Revenues from target financing
Other revenues
Cash paid for:
repayment of loans and borrowings (ex interest)
for other expenses
Net cash as per financial activity
Net increase (decrease) of cash funds and their equivalents
Demand balance as of the end of the reporting period
Effect of currency rate fluctuation in relation to ruble
ANNUAL REPORT
2010
2
3
4
350
11 193 854
40 180 434
360
49 990 500
4 000 000
370
380
100
2
–
–
390
405
410
420
430
440
(7 366 440)
(179 212)
53 638 804
(68 831)
and 243 301
–
(23 980 000)
(66 832)
20 133 602
5 672 081
11 312 132
–
"29" _______ March _____ 2011
185
NOTES TO
THE BALANCE SHEET
FOR 2010
MF FTX RF KN No. 4
RECEIVED
March 30 2011
NOTES TO THE BALANCE SHEET
for 2010
Organization
Taxpayer identification
number
Type of activity
Form of incorporation/Form
of ownership
CODES
Form No. 5 according to the AllRussian Classifier of Management
0710005
Documentation
Date (year, month, day) 2010 12
31
according to the All-Russian National
Classifier of Businesses and
56947007
Organizations
TIN
4716016979
All-Russian Classifier of Types of
40.10.2
Economic Activity
according to All-Russian Classifier of
47
41
Forms of Ownership/All-Russian
Classifier of Forms of Incorporation
384/385
“Federal Grid Company
of Unified Energy System”,
JOINT-STOCK COMPANY
Power transmission
Open Joint Stock Company/mixed
ownership with federal state share
ths. rub.
Description
Code
1
2
Intangible assets
Availability as
of the beginning
of reporting year
3
010
1 288 243
46 046
í
1 334 289
011
9 715
30 775
í
40 490
012
1 278 282
15 271
013
í
í
í
í
014
246
í
í
246
015
í
í
í
í
í
í
21 407
67 453
í
í
í
í
í
í
1 076 026
2 410 315
Index
Intellectual properties
(exclusive rights for the results
of intellectual property)
including:
patent holder for invention,
industrial prototype, useful
model
right holder for PC
software, data bases
right holder for lay-out
of integrated circuits
owner of trade mark
and service mark, place
description of goods origin
patent holder for selection
achievements
Organizational costs
Business reputation
Other
Total
020
030
040
045
Index
Description
1
Depreciation of intangible assets í total
including:
Item of intellectual property
186
Supplement to Order of the Ministry
of Finance of the Russian
Federation
dated 22.07.2003 No. 67n
í
í
1 054 619
2 342 862
Received
4
Code
2
050
Availability as of
Withdrawn the end of reporting
period
5
6
1 293 553
As of the beginning
of reporting year
3
946 605
310 648
As of the end of
reporting period
4
1 492 690
636 258
FEDERAL GRID COMPANY
ANNUAL REPORT
2010
Form 0710005 p. 2
Index
Description
Code
1
2
110
111
112
113
114
Buildings
Structures and transfer gears
Machines and equipment
Transport vehicles
Production and auxiliary
equipment
Draught livestock
Productive livestock
Perennial plantings
Other types of fixed assets
Land plots and nature
management facilities
Capital investment
in land reclamation
Total
115
116
117
118
119
Fixed Capital Assets
Received
Availability as of
the beginning of
reporting year
3
4
15 741 565
2 468 613
296 796 975
7 354 863
92 238 177
19 634 426
2 065 864
967 877
Availability as of
the end of reporting
period
5
(366 067)
(372 626)
(1 052 239)
(112 132)
6
17 844 111
303 779 212
110 820 364
2 921 609
1 133 307
222 246
(27 252)
1 328 301
í
í
í
291 813
í
í
í
107 252
í
í
í
(54 153)
í
í
–
344 912
156 495
676 567
5 841
827 221
120
130
Withdrawn
í
408 424 196
Index
Description
1
Deprecation of fixed assets – total
including:
buildings and
structures
machines, equipment, transport means
others
Leased out fixed asset items – total
including:
buildings
and structures
machines, equipment, transport means
others
Preserved fixed asset items
Rented fixed asset items – total
including: buildings
and structures
machines, equipment, transport means
others
Immovable property items put into operation which
documents were not handed over to the state
For reference:
Result from reevaluation of fixed asset items:
initial (replacement) cost
depreciation
Change in the cost of fixed asset items due to completion,
further fitting-out, reconstruction, partial liquidation
31 431 844
í
í
(1 990 310)
437 865 730
As of the beginning
Code of reporting year
2
3
140
170 670 445
141
135 451 256
As of the end of
reporting period
4
201 672 563
156 804 949
142
143
150
151
34 379 931
839 258
6 197 246
5 472 116
43 797 564
1 070 050
5 594 610
4 966 807
152
153
703 610
21 520
573 827
53 976
155
160
161
8 354
6 189 371
2 437 885
62
13 693 765
2 582 992
162
163
165
1 521 222
2 230 264
5 241 196
1 818 263
9 292 510
9 306 220
Code
As of the beginning
of reporting year
2
3
170
86 150 081
171
135 092 840
172
48 942 759
Code As of the beginning
of reporting year
2
3
180
1 303 037
As of the beginning
of preceding
year
4
6 884 139
10 350 330
3 466 191
As of the end of
reporting year
4
4 798 581
187
ATTACHMENTS
Form 0710005 p. 3
Index
Description
1
Property to be leased out
Property received
under lease
agreement
Other
Total
1
Depreciation of incomebearing investments into
material values
Income-bearing investments into material valuables
Availability as of
Received
Withdrawn
the beginning of
Code
reporting year
2
3
4
5
210
í
í
í
220
í
í
í
230
240
Code
2
250
í
í
As of the
beginning of
reporting year
3
í
í
í
As of the end of
reporting period
í
í
Availability as of
the end of reporting
period
6
í
í
í
í
4
í
Costs for research and scientific as well as for design and development works
Type of work
Received
Written off Availability as of
Availability
as of the beginning
the end of reporting
Description
Code
of reporting year
period
1
2
3
4
5
6
Total
310
751 001
1619 420
(1 158 460)
1 211 961
including:
311
í
í
í
í
Works on creation of power for distribution
312
networks based on high temperature
133 208
í
(5 791)
127417
superconducting technologies
miscellaneous
313
617 793
1 619 420
For reference :
Code
Total cost of uncompleted research and research and scientific as well
as for design and development works
2
320
Code
The sum of costs for research and scientific as well as for design
and development and technologic works that did not bring in
positive results and are referred to extraordinary charges
2
330
Costs for natural resources development
Index
Balance as of the
beginning of
Description
Code reporting period
1
Cost for natural resources
development í total
including:
2
410
3
í
411
412
413
í
í
í
For reference:
The sum of costs for subsurface portions, uncompleted
exploration, surveys and (or) hydrogeological surveys and
other similar works
The sum of costs for resource development in the
reporting period allocated to extraordinary charges as
ineffective
188
Received
4
í
í
í
í
Code
2
420
430
(1152 669)
As of the
beginning of
reporting year
3
677 196
For the
reporting
period
3
–
Written off
5
í
í
í
í
As of the
beginning of
reporting year
3
1 084 544
As of the end of
reporting year
4
956 714
For the same period
of the preceding
year
4
–
Balance as of the
end of reporting
year
6
í
í
í
í
As of the end of
reporting period
4
FEDERAL GRID COMPANY
ANNUAL REPORT
2010
Form 0710005 p. 4
Index
Description
Financial investments
Long-term
As of the end of
As of the
reporting period
beginning of
Code
reporting year
2
3
4
1
Investments in registered
510
and reserve capitals of other
organizations í total
including those of
511
associated and dependent
economic organizations
State and municipal
515
securities
Securities of other
520
organizations-total
including debt
521
securities (debentures,
promissory notes)
Made loans
525
Deposits
530
Other
535
Total
540
Financial investments from
the total sum having
current market value:
550
Investments in registered
(reserve) capitals of other
organizations í total
Including those of daughter
551
and dependent economic
organizations
State and municipal
555
securities
Securities of other
560
organizations í total
Including debt
561
securities (debentures,
promissory notes)
Other
565
Total
570
For reference:
Change in value due to
correction of evaluation for
580
financial investments having
current market
590
For debt securities the
difference between initial
values and nominal value is
allocated to the financial result
of reporting period
Short-term
As of the
As of the end of
beginning of
reporting period
reporting year
5
6
66 194 804
94 896 533
í
í
58 903 317
85 835 487
í
í
í
í
í
í
469 301
8 935 682
44 190 554
42 356 353
469 301
8 935 682
44 190 554
42 356 353
303 113
í
3 169
66 970 387
302 163
í
3 169
104 137 547
887 671
24 049 500
887 671
3 000 000
69 127 725
46 244 024
47 075 372
67 368 001
í
í
40 338 195
21 851 019
í
í
í
í
í
í
í
í
í
í
í
í
í
í
í
47 075 372
í
67 368 001
í
í
í
í
(79 905 889)
29 915 526
í
í
í
í
í
189
ATTACHMENTS
Form 0710005 p. 5
Index
Description
Accounts payable and receivable
Balance as of the
beginning of
Code
reporting year
2
3
1
Accounts payable:
Short term í total
including:
transactions with buyers and customers
advance payments paid
other
Long term í total
including:
transactions with buyers and customers
advance payments paid
other
Total
Accounts receivable:
Short term í total
including:
transactions with suppliers and subcontractors
advance payments received
tax and levy payments
credits
loans
other
Long term -total
including:
credits
loans
other
Total
610
117 170 891
157 647 614
611
8 949 413
8 669 641
612
613
620
67 036 337
41 185 141
20 492 819
97 636 854
51 341 119
8 696 249
621
185 910
68 106
622
623
630
36
20 306 873
137 663 710
8 628 143
166 343 863
640
73 284 089
54 669 039
641
11 018 708
14 017 237
642
643
644
645
646
650
7 114 653
672 790
7 481 469
46 996 469
6 005 098
11 476 694
901 599
–
6 941 422
21 332 087
50 018 179
6 000 000
5 098
79 289 187
50 000 000
18 179
104 687 218
651
652
653
660
–
Costs for common activities (by cost categories)
Index
For the reporting
period
Description
Code
1
2
3
Materials costs
710
24 309 909
Labor costs
720
13 331 116
Social cost allocations
730
2 249 899
Depreciation
740
32 681 907
Other costs
750
9 154 712
Total by cost category
760
81 727 543
765
Change in balances (increase [+], decrease [í]):
Uncompleted production
unexpired costs
766
18 608
reserves for costs to be incurred
767
190
Balance as of the
beginning of
reporting year
4
–
For the preceding
year
4
30 035 110
6 758 157
1 084 984
23 417 508
7 912 473
69 208 232
–
(1 656 251)
–
–
FEDERAL GRID COMPANY
ANNUAL REPORT
2010
Form 0710005 p. 6
Received liabilities
Index
Description
Code
1
Received total
including:
promissory
notes
Property being in pawn
from it:
fixed asset items
securities and other financial investments
miscellaneous
Given – total
including:
promissory
notes
Property in prawn
from it:
fixed asset items
securities and other financial investments
miscellaneous
2
810
811
Balance as of the
beginning of
reporting year
3
70 943 984
Balance as
of the end of
reporting year
4
115 203 743
1 231 579
820
821
–
–
–
–
822
823
830
831
–
–
30 815
–
–
30 815
–
840
841
–
–
–
–
842
843
–
–
–
–
State support
Index
Description
1
Budget funds received in the reporting period – total
including:
miscellaneous
Budget credits – total
including:
miscellaneous
Reporting period
Code
2
910
911
912
920
921
922
3
For the same period
of the preceding
year
4
–
–
–
–
As of the
Received Returned As of the
beginning
for the
for the
end of
of
reporting reporting reporting
reporting
period
period
period
year
–
–
–
–
–
–
–
–
"29 " ______ March,_____ 2011
191
ATTACHMENTS
MOVING FORWARD
WITH NEW ENERGY
ANNUAL REPORT
2010
2009 RAS FINANCIAL
STATEMENTS
AND AUDIT REPORT
AUDIT REPORT
FOR 2009
PricewaterhouseCoopers Audit
White Square Office Center
10 Butyrsky Val,
Moscow, Russia, 125047
Telephone: +7 (495) 967-6000
Fax: +7 (495) 967-6001
www.pwc.ru
AUDITOR REPORT ON STATUTORY FINANCIAL
(ACCOUNTING) STATEMENTS 2009
[Translation from the original Russian]
To the shareholders of Federal Grid Company:
Auditor
PricewaterhouseCoopers Audit
State registration certificate No. 008.890, issued by Moscow Registration Bureau
on 28.02.1992.
Certificate of inclusion in the Unified State Register of Legal Entities regarding
a legal entity registered before 01.07.2002, No. 1027700148431, issued by the
Interregional Inspectorate of the Russian Ministry of Taxes and Levies, No. 39 for
the Moscow City, on 22.08.2002.
Member of non-profit partnership Audit Chamber of Russia (NP ACR) being a selfregulatory organisation of auditors, registration number 870, in the register of NP
ACR members.
Major registration record number (ORNZ) in the register of auditors and audit
organisations: 10201003683
Client
Federal Grid Company
5a Akademika Chelomeya Street, Moscow, 117630
State registration certificate No. 21081, series LO-002, issued by Leningrad Region
Registration Bureau on 25.06.2002, number in the Unified State Register of Legal
Entities No. 00/03124.
Certificate of inclusion in the Unified State Register of Legal Entities regarding a legal
entity registered prior to 01.07.2002, No. 1024701893336, issued by the Inspectorate
of the Russian Ministry of Taxes and Levies for the Tosno District of Leningrad Region
on 20.08.2002.
194
FEDERAL GRID COMPANY
ANNUAL REPORT
2010
PricewaterhouseCoopers Audit
White Square Office Center
10 Butyrsky Val,
Moscow, Russia, 125047
Telephone: +7 (495) 967-6000
Fax: +7 (495) 967-6001
www.pwc.ru
AUDITOR’S REPORT
on Statutory Financial (Accounting)
Statements of Federal Grid Company
To the Shareholders of Federal Grid Company:
1
2
3
We have audited the attached Statutory Financial (Accounting) Statements
of Federal Grid Company (hereinafter – the Company) for the period from
01.01.2009 up to 31.12.2009, inclusive. Statutory Financial (Accounting)
Statements of the Company consist of the Balance Sheet, Profit and Loss
Account, Statement of Changes in Equity, Cash Flow Statement, Supplement
to the Balance Sheet, Explanatory Notes (hereinafter, the statements as a
whole are called Statutory Financial (Accounting) Statements). The Statutory
Financial (Accounting) Statements were prepared by the management
of the Company in accordance with the legislation of Russian Federation
applicable to Statutory accounting reports. The Statutory Financial
(Accounting) Statements differ to a significant degree from those prepared
in accordance with International Financial Reporting Standards (IFRS).
Preparation of the Statutory Financial (Accounting) Statements is the
responsibility of management of the Company. Our responsibility as auditors
is to express our opinion on the fair presentation, in all material respects, of
the Statutory Financial (Accounting) Statements based on our audit.
We conducted our audit in accordance with The Federal Law titled On
Auditing Activity, Federal Auditing Standards, and International Standards
on Auditing and Company internal standards.
Our audit was planned and performed to obtain reasonable assurance
about whether the Statutory Financial (Accounting) Statements are free
of material misstatement. The audit includes examining, on a test basis,
evidence supporting the amounts and disclosures in the Statutory Financial
(Accounting) Statements, assessing compliance with accounting principles,
techniques and rules of the Statutory Financial (Accounting) Statements
preparation, evaluating significant estimates made by the management of
the Company and the overall Statutory Financial (Accounting) Statements
presentation. We believe that our audit provides a reasonable basis
for our opinion on the Statutory Financial (Accounting) Statements.
195
ATTACHMENTS
PricewaterhouseCoopers Audit
White Square Office Center
10 Butyrsky Val,
Moscow, Russia, 125047
Telephone: +7 (495) 967-6000
Fax: +7 (495) 967-6001
www.pwc.ru
AUDITOR’S REPORT
4
In our opinion, the Statutory Financial (Accounting) Statements of the
Company attached to this report have been properly prepared to present
fairly, in all material respects, the financial position of the Company as at
31.12.2009 and financial results of its operations for the period from 1
January up to 31.12.2009 in accordance with the legislation of Russian
Federation applicable for Statutory Financial (Accounting) Statements
preparation.
01.04.2010
196
FEDERAL GRID COMPANY
ANNUAL REPORT
2010
197
BALANCE
SHEET
FOR 2009
BALANCE SHEET
Form N1 on OKUD
as at 31 December 2009
Date (year, month, day)
Company Company Open Joint-Stock Company 'Federal Grid Company of Unified Energy System'
OKPO
Taxpayer identification number
INN
Field of activity Electric power transmission
OKVED
Legal form/property form
OKOPF/OKFS
Open Joint-Stock Company/ Russian mixed ownership with state share
Unit of measurement: thousands of RR
OKEI
Address
47/41
384/385
117630, Moscow, Ak. Chelomeya st., 5A
Date of approval
Date of dispatch (acceptance)
Assets
1
I. NON-CURRENT ASSETS
Intangible assets .......................................................................................................................
including:
patent rights, software, trademarks and other similar assets .............................................
other intangible assets .....................................................................................................
Fixed assets .............................................................................................................................
including:
plots of land and natural resources ..................................................................................
buildings, machinery and equipment, constructions .........................................................
other fixed assets ............................................................................................................
Construction in progress ..........................................................................................................
including:
equipment for installation ................................................................................................
investments in fixed assets ..............................................................................................
Income-bearing investments in tangible assets ..........................................................................
Long-term financial investments ...............................................................................................
Deferred tax asset ....................................................................................................................
Other non-current assets ..........................................................................................................
T o t a l Section I ....................................................................................................
II. CURRENT ASSETS
Inventories ...............................................................................................................................
including:
Raw, materials and other inventories ...............................................................................
Work in progress ............................................................................................................
Finished goods and goods for resale ................................................................................
Expenses related to future periods ...................................................................................
Other inventories and expenses .......................................................................................
Value Added Tax on goods purchased .....................................................................................
Accounts receivable (payment expected beyond
12 months of the reporting date) ...............................................................................................
including:
buyers and customers ......................................................................................................
advances issued ..............................................................................................................
other debtors ...................................................................................................................
Accounts receivable (payment expected within
12 months of the reporting date) ...............................................................................................
including:
buyers and customers .....................................................................................................
shareholders indebtness to Charter Capital .....................................................................
advances issued ..............................................................................................................
other debtors ...................................................................................................................
Short-term investments ............................................................................................................
Cash ........................................................................................................................................
including:
cash on hand ...................................................................................................................
cash at bank ....................................................................................................................
foreign currency accounts ...............................................................................................
financial documents ........................................................................................................
other cash .......................................................................................................................
Other current assets .................................................................................................................
T o t a l Section II ...................................................................................................
TOTAL SECTIONS I and II ....................................................................................
30.03.2010
Line
code
At beginning of
reporting year
At end of reporting
period
2
3
4
110
1 535 909
1 396 257
111
112
120
899 364
636 545
157 129 616
977 021
419 236
151 603 670
121
122
123
130
39 273
155 676 946
1 413 397
150 373 965
156 495
149 628 614
1 818 561
216 529 585
131
132
135
140
145
150
190
13 418 743
136 955 222
18 484 815
198 044 770
-
207 778 567
-
66 970 387
-
1 653 608
518 471 665
1 415 088
437 914 987
210
3 305 661
2 427 514
211
213
214
216
217
220
1 728 321
2 262 155
230
10 871 826
-
-
84 863
1 492 477
29 993
135 366
-
1 961 283
2 070 794
20 492 819
231
234
235
14 413
10 857 413
185 910
36
20 306 873
240
107 347 626
117 170 891
241
242
243
244
250
260
5 053 894
261
262
263
264
265
270
290
300
-
67 036 337
41 185 141
69 127 725
11 312 141
2 617
5 635 181
2 439
11 305 731
-
-
13
2 253
9
3 962
-
178 516 479
696 988 144
Line
code
At beginning of
reporting year
1
2
3
410
411
420
430
460
475
8 949 413
-
68 970 457
33 323 275
49 390 019
5 640 064
Equity and liabilities
III. EQUITY AND RESERVES
Charter capital .........................................................................................................................
Own shares buy-back ..............................................................................................................
Additional capital .....................................................................................................................
Legal reserve ...........................................................................................................................
Retained earnings (loss) ...........................................................................................................
Current year loss ......................................................................................................................
198
Codes
710001
2009/12/31
56947007
4716016979
40.10.2
222 601 884
660 516 871
At end of reporting year
4
576 757 098
576 757 098
-
59 502 413
9 910 770
(6 841 528)
-
59 386 652
10 134 044
(6 944 397)
(59 865 994)
1
FEDERAL GRID COMPANY
ANNUAL REPORT
2010
T o t a l Section III ..................................................................................................
IV. NON-CURRENT LIABILITIES
Borrowings and bank loans ......................................................................................................
Deferred tax liabilities ..............................................................................................................
Other non-current liabilities ......................................................................................................
T o t a l Section IV .................................................................................................
V. CURRENT LIABILITIES
Borrowings and bank loans ......................................................................................................
Accounts payable .....................................................................................................................
including:
Payable to suppliers and contractors ...........................................................................
Payable to staff ...........................................................................................................
Payable to state non-budget funds ...............................................................................
Taxes payable .............................................................................................................
Advances received ......................................................................................................
Other creditors ............................................................................................................
Payable to participants (shareholders) ......................................................................................
Income of future periods ..........................................................................................................
Reserves for future expenses and payments ..............................................................................
Other current liabilities .............................................................................................................
T o t a l Section V ...................................................................................................
TOTAL SECTIONS III, IV, V .................................................................................
490
639 328 753
579 467 403
510
515
520
590
18 000 000
517 859
130
18 517 989
6 000 000
1 435 064
5 098
7 440 162
610
620
16 161 487
22 601 947
7 481 469
65 802 620
621
622
623
624
627
625
630
640
650
660
690
700
10 175 866
76 713
15 102
295 113
7 096 192
4 942 961
84 474
293 494
11 018 708
134 473
18 906
653 884
7 114 653
46 861 996
46 898
278 319
-
39 141 402
696 988 144
REFERENCE ON ITEMS ACCOUNTED ON OFF-BALANCE SHEET ACCOUNTS
Line
At beginning of
Narrative
code
reporting year
1
2
Rented fixed assets ..................................................................................................................
thereof by leasing .................................................................................................................
Working and fixed assets received for storing ..........................................................................
Goods on commission ..............................................................................................................
Bad debts of insolvent debtors written off to losses ..................................................................
Securities of liabilities and payments received ..........................................................................
Securities of liabilities and payments issued .............................................................................
Housing stock depreciation ......................................................................................................
Depreciation of auxiliary engineering facilities and other similar items .....................................
Intangible assets obtained for usage .........................................................................................
Registered high-security forms .................................................................................................
910
911
920
930
940
950
960
970
980
990
1000
73 609 306
660 516 871
At end of reporting year
3
4
3 272 196
6 189 371
-
812 468
633 348
58 437 451
1 175 189
414 819
70 943 984
30 815
7
11
2
199
PROFIT AND LOSS
STATEMENT
FOR 2009
PROFIT AND LOSS ACCOUNT
Form N2 on OKUD
for 2009
Date (year, month, day)
Company Company Open Joint-Stock Company 'Federal Grid Company of Unified Energy System'
OKPO
Taxpayer identification number
INN
Field of activity Electric power transmission
OKVED
Legal form/property form
OKOPF/OKFS
Open Joint-Stock Company/ Russian mixed ownership with state share
Unit of measurement: thousands of RR
OKEI
Codes
710002
2009/12/31
56947007
4716016979
40.10.2
47/41
384/385
Narrative
Line
code
For reporting
period
For the same period
of the previous year
1
2
3
4
Income from and expenses on ordinary activities
Sales of goods, products, work, services (less VAT, excise duty
and other similar compulsory payments) ....................................................................................
including:
electric power transmission services ................................................................................
other sales ........................................................................................................................
Cost of goods, products, work, services sold ..............................................................................
including:
electric power transmission services ................................................................................
other sales ........................................................................................................................
Total revenue (loss) ...................................................................................................................
Sales expenses ...........................................................................................................................
General business expenses .........................................................................................................
Gross profit (loss) from sales .....................................................................................................
Other income and expenses
Interest receivable ......................................................................................................................
Interest payable ..........................................................................................................................
Participation in other companies ................................................................................................
Other income .............................................................................................................................
Other expenses ..........................................................................................................................
Income (loss) from operations ....................................................................................................
Teoretical income tax gain/(charge) (140 ɯ 24% 2008, ɯ 20% 2009) .........................................
Permanent tax liabilities (assets) ................................................................................................
Deferred tax assets .....................................................................................................................
Deferred tax liabilities ...............................................................................................................
Current income tax ....................................................................................................................
Other similar compulsory payments ...........................................................................................
Income tax adjustment for previous periods ...............................................................................
Net profit (loss) for the reporting year .......................................................................................
REFERENCE
Basic earnings (loss) per share ...................................................................................................
Diluted earnings (loss) per share ................................................................................................
010
85 077 809
68 485 030
011
012
020
80 173 317
4 904 492
(64 079 927)
66 128 765
2 356 265
(58 977 340)
021
022
029
030
040
050
(62 732 093)
(1 347 834)
20 997 882
(57 107 753)
(1 869 587)
9 507 690
(5 128 305)
15 869 577
(4 351 940)
5 155 750
060
070
080
090
100
140
143
200
141
142
150
151
152
190
7 291 952
(1 717 506)
717 256
105 760 531
(181 970 591)
(54 048 781)
10 809 756
(16 588 331)
(180 217)
(722 009)
(4 876 349)
(4 642)
(33 996)
(59 865 994)
6 806 385
(2 385 645)
223 272
31 347 105
(34 970 048)
6 176 819
(1 482 437)
(1 952 589)
6 767
(216 856)
(3 224 937)
461 546
1 262 136
4 465 475
201
202
(5 190)
-
-
575
-
-
BREAKDOWN OF SPECIFIC INCOMES AND EXPENSES
Narrative
1
Fines and penalties recognized by court or those on which there are
judgments of a court (or arbitrage court) on their recovery .........................................................
Profit (loss) of previous years ....................................................................................................
Compensation for damages caused by default on obligations or
by improper fulfillment of obligations .......................................................................................
Exchange rate differences ..........................................................................................................
Revaluation reserve ...................................................................................................................
Write-off of debtor and creditor indebtedness
on which the period of limitation has expired ............................................................................
Line
code
2
For the similar period
of the previous year
income
expense
For reporting period
income
expense
3
4
230
240
397 323
412 431
250
260
270
26 455
ɏ
280
6 556
5
40 390
521 681
-
15 949
9 404 732
1 861
288 008
-
8 065
25 169
-
15 619
5 028 828
ɏ
9 122
-
6
152 738
115 403
17 230
-
-
1
200
STATEMENT OF CHANGES
IN STOCKHOLDER’S EQUITY
FOR 2009
ANNUAL REPORT
2010
FLOW OF EQUITY AND FUNDS
Form N3 on OKUD
Date (year, month, day)
OKPO
INN
OKVED
for 2009
Company Company Open Joint-Stock Company 'Federal Grid Company of Unified Energy System'
Taxpayer identification number
Field of activity Electric power transmission
Legal form/property form
Open Joint-Stock Company/ Russian mixed ownership with state share
Unit of measurement: thousands of RR
OKOPF/OKFS
OKEI
Codes
710003
2009/12/31
56947007
4716016979
40.10.2
47/41
384/385
I. Changes in equity
Narrative
Line
code
Charter
capital
Additional
capital
Reserve
capital
Accumulated
profit/loss
1
2
3
4
5
6
Balance as of 31 December
of the year antecedent to the previous year ............................. 010
2008
180 691 104
16 994 046
x
x
x
180 691 104
x
x
x
x
396 065 994
57 482 627
x
4 099 955
4 657 605
Total
7
2 442 736
204 785 491
previous year
Changes in accounting policy ......................................................
Revaluation of fixed assets ..........................................................
Changes in accounting rules ........................................................
Balance as of 1 January of the previous year ..........................
Exchange rate difference .............................................................
Net profit (loss) ............................................................................
Dividends ....................................................................................
Allocations to reserves .................................................................
Increase of capital due to
additional shares issue ............................................................
increase of share par value ......................................................
reorganization of legal entity ...................................................
other .......................................................................................
Decrease of capital due to
decrease in value of shares .....................................................
reduction in number of shares ................................................
reorganization of legal entity
other .......................................................................................
Balance as of 31 December of the previous year ....................
2009
011
012
013
020
023
025
026
030
040
041
042
043
044
050
051
052
053
054
060
21 094 001
-
338 583 367
576 757 098
x
x
x
31 663 260
x
x
21 316 409
10 346 851
(159 901)
x
x
x
(159 901)
52 597 360
x
x
x
4 657 605
x
x
x
1 916 167
3 336 998
x
x
3 336 998
1 601
4 101 556
2 444 337
x
4 465 475
380 000
(1 916 167)
22 138 655
x
x
22 138 655
-
x
x
x
208 887 047
4 465 475
(380 000)
453 204 907
57 482 627
-
-
385 375 429
10 346 851
159 901
x
x
-
-
9 910 770
159 901
26 912 201
666 177 429
current year
Changes in accounting policy ......................................................
Results of property evaluation .....................................................
Changes in accounting rules ........................................................
Balance as of 1 January of the current year ............................
Exchange rate differences ............................................................
Net profit .....................................................................................
Dividends ....................................................................................
Contributions to legal reserves .....................................................
Increase of capital due to .............................................................
additional shares issue ............................................................
increase of share par value ......................................................
reorganization of legal entity ...................................................
other .......................................................................................
Decrease of capital due to ...........................................................
decrease in value of shares .....................................................
reduction in number of shares ................................................
reorganization of legal entity ...................................................
other .......................................................................................
Balance as of 31 December of the current year ......................
061
062
063
100
103
105
106
110
120
121
122
123
124
130
131
132
133
134
140
x
x
x
576 757 098
x
x
x
x
x
6 905 053
59 502 413
x
x
x
-
576 757 098
x
x
x
x
x
x
9 910 770
x
x
x
223 274
x
x
x
x
(115 761)
x
x
x
(115 761)
59 386 652
(33 836 387)
(20 914)
103 572
(6 841 528)
x
(59 865 994)
(59 865 994)
-
x
x
x
x
(223 274)
4 644
x
x
x
4 644
115 761
x
x
4 644
4 644
-
-
10 134 044
(33 836 387)
6 884 139
103 572
639 328 753
115 761
(66 810 391)
579 467 403
1
201
ATTACHMENTS
II. Reserves
Narrative
Line
code
Balance b/f
Additions
Disposals
Balance
1
2
3
4
5
6
Legal reserves
formed in accordance with legislation
reserve
previous year ............................................................................ 150
current year ............................................................................... 151
Legal reserves formed in accordance
with foundation documents
4 657 605
9 910 770
5 253 165
223 274
-
9 910 770
10 134 044
reserve
previous year ............................................................................
current year ................................................................................
Provisions
Doubtful debt provision
previous year .............................................................................
changes in accounting policy .....................................................
current year ................................................................................
Provision for impairment of financial investments
previous year .............................................................................
current year ................................................................................
REFERENCES
Narrative
1
1) Net assets ................................................................................
152
153
-
-
-
160
160a
161
883 464
1 585 726
35 422 113
2 424 875
33 836 387
5 902 136
(1 722 613)
(20 017 408)
162
163
2 474 081
5 164 814
2 690 733
3 502 596
(75)
Line
code
At beginning
of reporting year
2
3
Line
code
2
2) Received for:
ordinary activity expenses - total ............................................ 210
capital investments ................................................................. 220
other ....................................................................................... 230
For reporting
year
1 585 726
35 422 113
21 306 841
-
5 164 814
8 667 335
At the end
of reporting period
4
639 622 247
From budget
200
-
579 745 722
From non-budget funds
For previous year For reporting year For previous year
3
4
-
5
322
6
119
-
322
144
-
119
144
2
202
CASH FLOW
STATEMENT
FOR 2009
ANNUAL REPORT
2010
CASH FLOW STATEMENT
Form N4 on OKUD
for 2009
Date (year, month, day)
OKPO
Company Company Open Joint-Stock Company 'Federal Grid Company of Unified Energy
Taxpayer identification number
INN
Field of activity Electric power transmission
OKVED
Legal form/property form
Open Joint-Stock Company/ Russian mixed ownership with state share
OKOPF/OKFS
Unit of measurement: thousands of RR
OKEI
Codes
710004
2009/12/31
56947007
4716016979
40.10.2
47/41
384/385
Narrative
Line
code
1
2
Cash at the beginning of the reporting year .........................................................
Cash movement - operating activity
Total cash received from customers and clients ........................................................
Foreign currnecy purchase ........................................................................................
Insurance compensation ............................................................................................
Other income .............................................................................................................
Total cash used for:
payments for purchased goods, work, services, materials
and other current assets .....................................................................................
wages and salaries payments .............................................................................
dividend paid, interest paid ...............................................................................
settlements of taxes and duties ..........................................................................
insurance payments ...........................................................................................
other payments ..................................................................................................
Net cash from operating activity ...............................................................................
Cash movement - investing activity
Sales of fixed assets
and other non-current assets ......................................................................................
Sales of securities and other financial investments ...................................................
Dividend received .....................................................................................................
Interest received ........................................................................................................
Redemption of loans provided to other entities ........................................................
Other income
Cash assets used for:
subsidiaries acquisition ........................................................................................
acquisition of fixed assets, income-bearing investments .....................................
and intangible assets ............................................................................................
acquisition of securities and other financial investments .....................................
loans granted to entities ........................................................................................
other expense .......................................................................................................
Net cash from investing activity ...............................................................................
Cash movement - financing activity
Proceeds from issue of shares and other equity instruments .....................................
Loans and credits
received .....................................................................................................................
Other income
Cash assets used for:
repayment of loans and credits (without interest) ................................................
other expense .......................................................................................................
Net cash from financing activity ...............................................................................
Net increase (decrease) in cash and cash equivalents ...............................................
Cash at the end of the reporting year ....................................................................
Ruble exchange
rate difference ...........................................................................................................
010
5 640 051
020
030
040
050
94 010 235
290 642
13 414 676
59 958 954
150
160
170
180
181
190
200
(43 950 985)
(5 589 044)
(2 122 038)
(6 142 236)
(62 654 338)
(5 857 276)
(2 427 161)
(26 927 880)
210
220
230
240
250
260
307 731
276 911 503
860 603
3 118 353
For the current year For the same period
of the previous year
3
4
12 991 358
80 973 311
200 661
-
-
(2 185 427)
47 725 823
(4 756 891)
38 509 380
500 929
15 019 375
489 968
3 805 783
-
-
280
(8 499 011)
(2 195 420)
290
300
310
320
340
(99 466 324)
(235 405 935)
(6 653)
(7 611)
(62 187 344)
(116 779 671)
(15 783 362)
(780)
(56 126)
(114 999 304)
350
40 180 434
20 424 586
360
380
4 000 000
390
405
410
420
430
(23 980 000)
(66 832)
20 133 602
5 672 081
11 312 132
440
56 107 063
-
(7 331 770)
(61 262)
69 138 617
(7 351 307)
5 640 051
-
-
1
203
NOTES TO
THE BALANCE SHEET
FOR 2009
SUPPLEMENT TO THE BALANCE SHEET
Form N 5 on OKUD
Date (year, month, day)
OKPO
INN
OKVED
for 2009
Company Company Open Joint-Stock Company 'Federal Grid Company of Unified Energy System'
Taxpayer identification number
Field of activity Electric power transmission
Legal form/property form
Open Joint-Stock Company/ Russian mixed ownership with state share
Unit of measurement: thousands of RR
INTANGIBLE ASSETS
Narrative
1
Intellectual property
(exclusive rights to intellectual property) .....................................................
including the rights:
of the patent holder on invention
industrial design, utility model ...................................................................
of software, database owner .......................................................................
of the integrated circuit layout owner ........................................................
of the trademark, servicemark owner,
names of origin of goods owner .................................................................
of plant patent holder ..................................................................................
Administration expenses ...............................................................................
Goodwill ........................................................................................................
Other
Total ..............................................................................................................
OKOPF/OKFS
OKEI
Line
code
At beginning of
reporting year
Additions
Disposals
2
3
4
5
010
924 746
011
012
013
924 500
014
015
020
030
040
045
9 715
353 782
363 497
At beginning of
reporting year
At end of reporting
period
2
3
4
443 456
946 605
24 946
310 648
Line
code
At beginning of
reporting year
Additions
Disposals
1
2
3
4
5
Buildings .......................................................................................................
Constructions and transfer mechanisms ........................................................
Machinery and equipment .............................................................................
Means of transportation .................................................................................
Production and work appliances ...................................................................
Working livestock .........................................................................................
Productive livestock ......................................................................................
Perennial plants ..............................................................................................
Other types of fixed assets ............................................................................
Plots of land and natural resources ...............................................................
Investments in reclamation ............................................................................
Total ..............................................................................................................
110
111
112
113
114
115
116
117
118
119
120
130
Narrative
Line
code
14 958 688
164 374 412
74 852 470
1 453 723
974 537
1 642 214
1 944 212
13 469 164
664 044
194 973
-
223 570
39 273
256 876 673
1 054 619
2 342 862
6
16 543 314
165 908 917
87 231 646
2 065 864
1 133 307
-
87 172
117 222
-
246
At end of reporting
period
(57 588)
(409 707)
(1 089 988)
(51 903)
(36 203)
-
-
(18 929)
18 119 001
291 813
156 495
-
(1 664 318)
273 331 356
At end of reporting
period
At beginning of
reporting year
1
2
Depreciation of fixed assets - total ..............................................................
including:
buildings and constructions ...................................................................
machinery, equipment, means of transportation ...................................
other ......................................................................................................
Fixed assets leased out - total ........................................................................
including:
buildings and constructions ...................................................................
machinery, equipment, means of transportation ...................................
other ......................................................................................................
Fixed assets transferred to conservation ........................................................
Fixed assets leased in - total ..........................................................................
including:
buildings and constructions ...................................................................
machinery, equipment, means of transportation ...................................
other ......................................................................................................
Fixed assets received
and being in the process of state registration ................................................
140
99 747 057
121 727 686
141
142
143
150
74 208 142
24 918 279
620 636
8 581 605
88 232 724
32 655 704
839 258
4 896 221
151
152
153
155
160
6 103 352
2 301 452
176 801
2 237
3 272 196
4 069 233
797 993
28 995
8 354
6 189 371
161
162
163
2 026 725
1 229 600
15 871
2 437 885
1 521 222
2 230 264
165
Line
code
2 674 939
At beginning of
reporting year
5 241 196
At beginning of
previous year
INCOME-BEARING PROPERTY
Narrative
9 715
1 278 282
-
Line
code
fitting-out, rigging up, reconstruction,
partial liquidation ........................................................................................... 180
-
-
1
REFERENCE.
2
Result of fixed assets revaluation:
170
historical (recovered) value ...................................................................... 171
depreciation ............................................................................................... 172
Line
2
Changes in fixed assets value as a result of
1 288 243
-
Narrative
FIXED ASSETS
Narrative
-
-
1 054 619
1 979 365
Amortization of intangible assets - total ....................................................... 050
including:
intellectual property
051
At end of reporting
period
246
47/41
384/385
6
363 497
-
Codes
710005
2009/12/31
56947007
4716016979
40.10.2
3
4
3
4
6 884 139
10 350 330
3 466 191
At beginning of
3
4 101 556
6 363 381
2 261 825
At end of reporting
4
1 465 469
1 873 833
Line
code
At beginning of
reporting year
Additions
Disposals
1
2
3
4
5
Property for lease-out ....................................................................................
Property for hiring .........................................................................................
Other ..............................................................................................................
Total ..............................................................................................................
210
220
230
240
-
-
At end of reporting
period
6
-
-
1
204
FEDERAL GRID COMPANY
ANNUAL REPORT
2010
Line
code
At beginning of
reporting year
2
3
4
Depreciation of income-bearing property ...................................................... 250
RESEARCH AND DEVELOPMENT COSTS
Narrative
1
At end of reporting
period
-
-
Line
code
At beginning of
reporting year
Additions
Disposals
At end of reporting
period
2
3
4
5
6
Total Research and Development costs ........................................................ 310
499 747
357 354
including:
311
research of FACTS systems
312
4 000
other
313
495 747
357 354
Line
At beginning of
At end of reporting
code
reporting year
period
REFERENCE.
2
3
4
Costs related to Research and Development
in progress ..................................................................................................... 320
486 564
677 196
Line
For the same period
For reporting period
code
of the previous year
2
3
1
-
Line Balance at beginning
code of reporting year
2
Line
1
2
-
(2 000)
(104 100)
2 000
749 001
3
-
Additions
Disposals
4
5
Total natural resources development costs .................................................... 410
including:
411
412
413
Line
At beginning of
At end of reporting
code
reporting year
period
REFERENCE
2
3
4
Expenses attributable to those areas of subsoil where prospecting and
evaluation of deposits, exploration and/or hydrological survey
and other similar works have not been finalized ........................................... 420
For the same period
Line
For reporting period
of the previous year
code
REFERENCE
2
3
4
Expenses attributable to natural resources development
without positive outcome, which were charged to
non-operating expenses of the current period ............................................... 430
FINANCIAL INVESTMENTS
Narrative
751 001
-
4
Costs related to Research and Development
without positive outcome which were charged to
non-operating expenses ................................................................................. 330
NATURAL RESOURCES DEVELOPMENT COSTS
Narrative
(106 100)
6
-
-
-
-
Short-term
at beginning of
at end of reporting
Long-term
at beginning of
at end of reporting
3
Balance at end of
reporting period
4
5
6
Investments in share capital
of other entities - total ....................................................................................
including subsidiaries .............................................................................
State and municipal securities .......................................................................
Securities of other entities .............................................................................
including debt securities (debentures, promissory notes) ......................
Loans granted ................................................................................................
Deposits .........................................................................................................
Other ..............................................................................................................
Total .........................................................................................................
Financial investments at current market value from total
Investments in share capital
of other entities - total ...................................................................................
510
150 897 718
511
515
520
521
525
530
535
540
120 868 894
66 194 804
9 837
207 778 567
3 169
66 970 387
550
136 404 713
47 075 372
58 903 317
-
-
56 574 551
56 574 551
296 461
469 301
469 301
303 113
-
-
-
-
-
48 482 663
48 482 663
887 671
-
19 685
49 390 019
44 190 554
44 190 554
887 671
24 049 500
69 127 725
-
-
551
109 406 501
40 338 195
including subsidiaries ..............................................................................
State and municipal securities ....................................................................... 555
Securities of other entities ............................................................................. 560
including debt securities (debentures, promissory notes) ...................... 561
Other .............................................................................................................. 565
Total ......................................................................................................... 570
136 404 713
47 075 372
REFERENCE
Line For reporting period For the same period For reporting period For the same period
2
3
4
5
6
Change in value due to measurement adjustments of financial
580
investments at current market value ..............................................................
Difference between acquisition cost and par value of
debt securities is charged to financial results
of the current period ...................................................................................... 590
ACCOUNT RECEIVABLE AND ACCOUNTS PAYABLE
Narrative
1
Accounts receivable:
Short-Term ............................................................................................
including:
receivables from customers and clients ..................................................
advances given ........................................................................................
other ........................................................................................................
Long-Term ............................................................................................
including:
receivables from customers and clients ..................................................
advances given ........................................................................................
-
(79 905 889)
-
Line
code
At beginning of
reporting year
2
3
-
-
-
-
-
At end of reporting
year
4
610
107 347 626
117 170 891
611
612
613
620
5 053 894
68 970 457
33 323 275
10 871 826
8 949 413
67 036 337
41 185 141
20 492 819
621
622
14 413
-
185 910
36
2
205
ATTACHMENTS
other ........................................................................................................
Total ..............................................................................................................
Accounts payable
Short-Term ............................................................................................
including:
payables to suppliers and contractors ......................................................
advances received ....................................................................................
tax and duties payments ..........................................................................
credits ......................................................................................................
loans ........................................................................................................
other ........................................................................................................
Long-Term ............................................................................................
including:
credits ......................................................................................................
loans ........................................................................................................
other
Total ..............................................................................................................
EXPENSES INCURRED IN ORDINARY
Narrative
1
Materials .........................................................................................................
Wages and salaries expenses ........................................................................
Obligatory social payments ...........................................................................
Fixed assets depreciation ..............................................................................
Other expenses ...............................................................................................
Total by expense type ....................................................................................
Changes in the balance (increase [+], decrease,[-]):
Work in progress ........................................................................................
Expenses of future periods .........................................................................
Reserves of future expenses .......................................................................
COLLATERAL
Narrative
623
630
10 857 413
118 219 452
640
38 763 434
73 284 089
641
642
643
644
645
646
650
10 175 866
7 096 192
295 113
10 156 891
6 004 596
5 034 776
18 000 130
11 018 708
7 114 653
653 884
651
652
653
660
5 000 000
13 000 000
130
56 763 564
6 000 000
5 098
79 289 187
Line
code
For reporting year
For previous year
2
3
-
4
30 035 110
24 481 538
720
730
740
750
760
6 758 157
1 084 984
23 417 508
7 912 473
69 208 232
6 723 873
1 216 059
20 849 262
10 058 548
63 329 280
765
766
767
(1 656 251)
-
At beginning of
reporting year
2
3
Received ........................................................................................................
including:
promissory notes .....................................................................................
Property in pledge ..........................................................................................
including:
fixed assets ...............................................................................................
securities and other financial investments ................................................
other .........................................................................................................
Issued ............................................................................................................
including:
promissory notes ...........................................................................................
Property given for pledge ..............................................................................
including:
fixed assets ...............................................................................................
securities and other financial investments ................................................
other .........................................................................................................
810
-
At end of reporting
year
4
58 437 451
70 943 984
811
820
-
821
822
823
830
-
831
840
1 358 444
-
Line
code
1
7 481 469
47 015 375
6 005 098
710
1
GOVERNMENT GRANTS
Narrative
20 306 873
137 663 710
1 231 579
-
1 175 189
30 815
1 144 374
841
842
843
-
-
-
-
Line
code
For reporting period
2
3
For the same period of the previous year
4
Budgeting funds received - total ................................................................... 910
including:
911
other
912
Line
code
2
Credits from budget - total ............................................................................ 920
including:
921
Other
922
322
322
At end of reporting
period
At beginning of
reporting year
Received in
reporting period
3
4
Returned in
reporting period
5
6
-
-
-
-
-
-
-
-
3
206
FEDERAL GRID COMPANY
ANNUAL REPORT
2010
207
ATTACHMENTS
MOVING FORWARD
WITH NEW ENERGY
ANNUAL REPORT
2010
2010 MANAGEMENT DISCUSSION
AND ANALYSIS MD&A
COMPLIANCE WITH THE CODE
OF CORPORATE GOVERNANCE
2010 GENERAL
SHAREHOLDERS MEETINGS
BRANCHES
SUBSIDIARIES
2010 INTERESTED PARTY
AND MAJOR TRANSACTIONS
IMPLEMENTATION
OF THE ASSIGNMENTS
OF THE PRESIDENT
AND GOVERNMENT
OF THE RUSSIAN FEDERATION
AUDIT COMMISSION CONCLUSIONS
ON THE VERACITY OF INFORMATION
IN THE ANNUAL REPORT
2011 INVESTOR CALENDAR
GLOSSARY
CONTACTS
ATTACHMENTS
MANAGEMENT DISCUSSION
AND ANALYSIS (MD&A)
OVERVIEW OF FEDERAL GRID
COMPANY'S FINANCIAL PERFORMANCE
AS OF 31 DECEMBER, 2010 AND 2010
OPERATING RESULTS
The Report represents a review of the fi nancial
position and performance of Federal Grid Company
(hereinaſter referred to as the Company) and should
be regarded together with the Company’s 2010
accounting reports, as prepared in accordance with
Russian Accounting Standards (RAS), including an
explanatory note hereto.
Overview of Corporate Activities
The Company’s main activity is providing electric
power transmission services to consumers via
the Unified National (All-Russian) Electrical Grid
(UNEG). In accordance with Russian Federation laws,
electricity transmission services via the UNEG are
the prerogative of Federal Grid Company, constitute
monopolistic activities and are regulated by the State.
The cost of the Company’s electricity transmission
services are determined by tariffs established by the
Federal Tariff Service (FTS).
As of 31 December, 2010, the Company has 51
branches and is headquartered in Moscow. In 2010,
the Company’s average head count was 21,965
people (in 2009 – 11,303 people). The significant
(94.3%) growth in 2010, compared with the previous
period, is associated with transferring electrical
equipment maintenance and repair functions from
Glavsetservis UNEG to Federal Grid Company and
relocating most of the employees of Glavsetservis
UNEG to the Company’s branches.
via active work to technologically connect new
consumers to the UNEG. During 2010, corporate
consumers numbered about 150 companies that were
technologically connected to the UNEG, including
distribution grid companies (DGCs); independent grid
companies (GCs); energy sales companies (ESCs); and
major electricity-consuming companies.
The Company makes substantial investments in fixed
assets for the development and reliable operation
of the UNEG. In 2010, the volume of construction,
renovation and modernization of fixed assets
amounted to RUR167,031 mln (compared with
RUR106,044 mln in 2009).
In 2010, the Company financed investment
activities via:
•
•
•
•
•
Funds provided for by the tariff for electricity
transmission - 29%;
Funds received from placing the Company
shares - 18%;
Raised funds - 26%;
RAO UES of Russia funds from selling assets
as a result of reorganization - 16%;
Other sources – 11%.
Together with electricity transmission services, the
Company renders services for the technological
connection of new consumers to the UNEG. In 2010,
the Company’s revenues from providing said services
amounted to RUR609 mln (2009: RUR3,053 mln).
The Company's shares are traded on the Russian
Trading System (RTS) and have been listed on the
Moscow Interbank Currency Exchange (MICEX)
since July 2008. On 28 March, 2011, the Company’s
depository receipts (DRs) began trading on the Main
Market of the London Stock Exchange (LSE).
Major Factors That Impacted Federal Grid
Company’s Results
Major factors that impacted the Company’s 2010
•
The revaluation of investments received by the
Company as the result of the reorganization of
RAO UES of Russia;
•
Positive financial results from reversal and accrual of bad debt provision;
•
Increased equipment being serviced as a result
of the Company’s investment program;
•
Increase in the Company's investment program.
Each year, the number of consumers of the Company’s
electricity transmission services grows, including
State Relations
As of 31.12.2010, 79.48% of the Company’s ordinary
210
FEDERAL GRID COMPANY
ANNUAL REPORT
2010
voting shares were owned by the State (as of
31.12.2009 – 79.11%), represented by the Federal
Agency for State Property Management. The Russian
Federation has a direct impact on the Company’s
activities by regulating its tariffs through the
Federal Tariff Service (FTS). Federal Grid Company's
investment program is subject to approval by the
Russian Government.
Regulating and Reorganizing the Electric
Power Industry
As a result of RAO UES of Russia reorganization in
July 2008, assets, including cash, promissory notes,
as well as non-core assets, including shares in power
generating companies, were transferred to Federal
Grid Company ownership. A part of received assets
were planned for sale. The Company plans to use
funds received from the sale of the above-mentioned
assets as a fi nancing source for its investment
program.
Within the framework of the project to consolidate
electric power assets on the foundation of Inter
RAO UES (the Russian President’s Order No.
1190 as of 30.09.1910), the following shares were
transferred to the trust management of Inter RAO
UES, in addition to an equity stake in WGC-1 (Trust
Management Contract No. 82531 as of 11.03.2009):
Bashkirenergo, Volga TGC, TGC-11, TGC-6, Mosenergo,
TGK-14, Quadra, TGC-2, TGK-9, RusHydro, TGK-3,
Fortum, TGC-1, OGK-2, OGK-4, OGK-6, Yenisei TGK,
Kuzbassenergo, TGC-11 Holding and WGC-3, owned
by the Company.
The above-mentioned investments are booked on the
Company's balance at market value as of 31.12.2010.
In 2010, the profit from changes in the current market
value stood at RUR29,915,526 thousand.
Events aſter the reporting date: On 23 March, 2011,
there was an Extraordinary General Shareholders
Meeting of Federal Grid Company, at which the deal
between Federal Grid Company and Inter RAO UES
to purchase additional shares of Inter RAO UES
placed via closed subscription was approved. To pay
for the above-mentioned shares, the shares of generating companies owned by Federal Grid Company
were transferred.
211
ATTACHMENTS
The Company’s Financial Results
2010
2009
Difference,
RUR mln
Change, %
111,084.67
85,077.80
26,006.87
30.57%
109,510.28
1,574.40
80,173.30
4,904.50
29,336.98
-3,330.10
36.59%
-67.90%
-75,518.40
-64,079,90
11,438.50
17.85%
-74,694.57
-823.83
-62,732.10
-1 347.80
11,962.47
-523.97
19.07%
-38.88%
Administrative expenses
-6,209.15
-5,128.30
1,080.85
21.08%
Operating profit
29,357.13
15,869.60
13,487.53
84.99%
5,436.24
7,292.00
-1,855.76
-25.45%
Interest paid
-273.75
-1,717.50
-1,443.75
-84.06%
Proceeds from investments in associated companies
422.31
717.3
-294.99
-41.13%
Other income
142,534.20
105,760.50
36,773.70
34.77%
Other expenses
-109,157.60
-181,970.60
-72,813.00
-40.01%
68,318.52
-54,048.80
122,367.32
2,2-fold
increase
-33.44
-1802
146.758
81.44%
Deferred profit tax liabilities
-1181.21
-722
-459.205
-63.60%
Current profit tax
-9264.31
-4,876.30
4,388.01
89.99%
43.226
-4.6
47.826
10-fold
increase
205.592
-34
239.59
7-fold
increase
58,088.38
-59,866.00
117,954.38
2-fold
increase
2010
2009
109,510.3
80,173.3
94,949.4
14,560.8
66,682.1
13,491.2
Income and expenses from ordinary activities
Revenues from operating activities
including:
Power transmission services
Other activities
Operating expenses
including:
Power transmission services
Other activities
Other income and expenses
Interest received
Profit/(loss) before profit tax
Deferred profit tax assets
Other similar mandatory payments
Adj. profit tax for past periods
Net profit/(loss) for the period
Revenues from Electricity Transmission Services
t Филиал
Revenues from transmission services,
including:
Payment for maintaining electric facilities included in the UNEG
Payment for standard process electricity losses in the UNEG
2009-2010 analyzed period illustrated revenue
growth from providing transmission services.
2010 revenues increased by RUR29,337 million
(36.6%) year-to-year. In 2010, key drivers of revenue
212
growth from electricity transmission services regarding
the maintenance of electric facilities were an increase
in the volume of grids being served and implementation
of the corporate investment program.
FEDERAL GRID COMPANY
ANNUAL REPORT
2010
Based on 2010 results, revenues from services (excluding revenues from technological connections)
related to the principal regulated activities accounts for 98.58 % of total revenues.
Operating Expenses
Components
2010
%, from total
2009
%, from total
Change, %
Depreciation of property, plant and equipment (PPE)
31,727
42%
22,562
35%
40.6%
Electricity and capacity purchased
14,183
19%
13,433
21%
5.6%
Employee benefit expenses and payroll taxes
13,926
18%
7,028
11%
98.2%
Repair and maintenance
5,984
8%
14,127
22%
-57.6%
Raw materials, work clothing and fuel
2,207
3%
410
1%
438.3%
Property insurance expenses
1,304
2%
1,094
2%
19.2%
929
1%
772
1%
20.3%
Property security expenses
1,105
1%
766
1%
44.3%
Other expenses
4,154
6%
3,888
6%
6.8%
75,518
100%
64,080
100%
17.8%
Rental expenses
Total operating expenses
PPE Depreciation
Increased 2010 PPE depreciation is caused by depreciation of new facilities commissioned in late 2009
and 2010 and PPE revaluation.
Employee Benefit Expenses and Payroll Taxes
Increased employee benefit expenses and payroll
taxes are due to technical factors. In 2010, personnel from the Company’s service subsidiary, Glavsetservis which performs equipment maintenance
and repair, were employed, which increased said
expenses by 98.2% and a corresponding reduction
in costs for repairs that are carried out and contracted.
Electricity and Capacity Purchased
In 2010, expenses for electricity and capacity purchases rose 5.6% year-on-year. This growth is due to
an 2010 increase in the liberalized share of the WECM
(in 1H 2010, it reached 60%, in 2H 2010 – 80%) and
tariff growth for electricity and capacity purchased
on the WECM.
Repair and Maintenance
Maintenance and repair expenses performed by
contractors declined 57.6% in 2010 y-o-y due to
employing personnel from the service subsidiary,
Glavsetservis, carrying out equipment maintenance
and repair and the relevant redistribution of repair
costs to other items (labor remuneration, insurance
premiums, travel expenses, raw materials and other
materials).
Rental Expenses
These expenses include the cost of renting production property (UNEG facilities), as well as land lease
costs. Rental expenses have increased more than 20%
in 2010 compared with 2009 due to higher land lease
rates in certain regions.
Raw Materials Expenses
Expenses for raw materials and fuel have increased
due to employing personnel from the service subsidiary, Glavsetservis, and carrying out maintenance and
equipment repair in a non-contracted method.
213
ATTACHMENTS
Property Security Expenses
In 2010, the 44.3% growth in security expenses was
associated with increased physical protection of
facilities, an increase in the number of facilities to be
protected and implementation of a counter-terrorism
security program at UNEG facilities.
Other Expenses
Increased spending on other items is due to chnical
factors, for example, redistributing costs from the expense item repair by a contracted method to expense
items transportation costs and travel expenses for
production personnel due to transferring to the service
subsidiary, Glavsetservis, and performing maintenance
and equipment repair in a non-contracted method.
Administrative Expenses
Components
2010
% from total
2009
% from total
Change, %
Employee benefit expenses
and payroll taxes
1,656.9
27%
989.1
19%
67.5%
Information services
and soſt ware expenses
1,026.4
17%
937.6
18%
9.5%
Depreciation of PPE
and intangible assets (IA)
955.3
15%
855.1
17%
11.7%
Production services
455.8
7%
561.9
11%
-18.9%
Material expenses
491.6
8%
469.4
9%
4.7%
Rental expenses
350.9
6%
415.4
8%
-15.5%
6.9
0%
5.8
0%
19.0%
25.4
0%
30.4
1%
-16.4%
Communication services
259.6
4%
201.1
4%
29.1%
Advisory services
186.1
3%
163.1
3%
14.1%
R&D expenses
171.9
3%
27.4
1%
527.4%
Other expenses
622.3
10%
472
9%
31.8%
6,209.1
100%
5,128.3
100%
21.1%
Property insurance expenses
Property security expenses
Total expenses
Depreciation of PPE and IA
The main reason for 2010 depreciation growth was
the commissioning of soſtware products and the revaluation of PPE, which resulted in an 11.7% increase
compared with 2009.
Employee Benefit Expenses and Payroll Taxes
In 2010, the growth in said expenses was 67.5%
compared to 2009 due to structural changes and the
relocation of subsidiary service personnel.
214
Material Expenses
The growth in expenses in this category is due to
inflation growth.
Rental Expenses
Rental expenses include costs for renting office buildings and communication systems. In 2010 rental
costs decreased 15.5% compared with 2009 due to
the Costs Reduction Program implemented by the
Company during the reporting period.
FEDERAL GRID COMPANY
Advisory and Legal Services
The 14% increase in consulting services is due to an
increase in consulting services for accounting and
reporting, as well as for forming the system of quality
and reliability indicators.
Other Production Services
The reduction in costs for this item is due to the Company’s production needs and accounts for one-time
work performed in 2009 within the framework of targeted programs to assess property, work out UNEG
development schemes and form budgeted electric
energy and capacity balance sheets. In 2010, expenditures for these programs decreased due to the
lack of need.
Operating Profit
In 2010 operating profit increased 85% compared
with 2009 due to revenue growth exceeding expenses increases, as the Company's revenue grew by
30.57%, whereas cost grew by only 17.85%.
Significant impact on this growth has increased the
investment program and, accordingly, formed a base
for financing the Company’s investment program.
Interest Received/Paid
Interest received represents revenues from debt financial investments and income from placing free
funds in bank accounts and deposits. A significant
portion of profitable investments were received by
the Company as a result of RAO UES of Russia restructuring on 1 July, 2008.
ANNUAL REPORT
2010
Interest received in 2010 decreased 25.4% compared
with 2009, as a result of reducing residual free cash
funds due to actively implementing the investment
program and its related financing.
Due to changes in the Company’s accounting policies
since 2010, interest costs are capitalized and included
in the cost of construction. In this regard, accounts
reflect the 2010 decrease in interest expense by
84.1% compared with 2009.
In 2010 the Company increased total debt from
RUR13,000 million as of 1 January, 2010 to
RUR56,000 million as of 31 December, 2010. This
change was due to issuing Series 6, 7, 8, 9, 10 and
11 bonds totaling RUR50,000 million to finance the
Company’s investment program. In addition, in 2010
the Company redeemed a Series 2 bond issue worth
RUR7,000 million. The Series 4 bond issue matures
in November 2011. In corporate accounts, it is booked
as short-term borrowings.
In accordance with changes in accounting policies,
the interest on promissory notes and bonds shall be
apportioned to the value of the investment assets. In
2010 the sum of all accrued interest is included in the
cost of construction-in-progress and totals RUR1,277
million. In 2009 the total amount of accrued interest
was RUR1,939 million. Of this, RUR1,714 million was
included in other expenses, whereas RUR221,957 million was included in the price of investment assets.
215
ATTACHMENTS
Other Incomes, RUR mln
Description
2010
2009
Redemption of promissory notes
87,286.8
81,068.35
Income from revaluing shares at fair market value
30,024.9
0
Incomes from provision reversal for bad debt
20,897.8
20,017.4
1,841.2
2,729.3
731.7
456.7
1,751.8
1,488.8
142,534.2
105,760.5
2010
2009
Redemption of promissory notes
85,940.592
79,281.635
Provision for bad debt
14,036.443
5,902.136
3,913.434
3,502.596
Loss from disposal of investments
985
9,793.452
Book value of written-off PPE and construction-in-progress
and writing off expenses
654
635
Provision for the impairment of material assets
661
0
Property tax
611
605
Loss from revaluing shares at fair market value
109
79,905.889
2.247
2.345
109,157.6
181,970.6
Income from disposal of investments
Extraordinary gains on insured events
Other incomes
Total other incomes
Other Expenses, RUR mln
Description
Provision for investment impairment
Others
Total other expenses
Income/Expenses from Disposal
of Investments
In 2010, the Company received a profit of RUR1,346.2
million (2009: RUR1,786.7 million) from redemption
of third-party promissory notes.
In 2010, the Company received a profit of RUR856.2
million from disposal of the Company’s other investments, mainly from selling TGC-7 shares (2009: a
loss of RUR7,064 million, including a loss from selling
TGK-12 shares in the amount of RUR7,017 million).
216
Revaluation of Investments
As of 31 December, 2010, the Company recorded
a gain on the revaluation of shares based on market
value amounting to RUR30,025 million. Profi t from
changes in the current market value of shares in 2010
amounted to RUR29,916 million and was recorded as
other income. Furthermore, in 2010, a provision for
investment impairment, for which current market
value cannot be determined, was created which totals
RUR3,913 million.
FEDERAL GRID COMPANY
ANNUAL REPORT
2010
In 2009, the Company recorded a negative difference
on the revaluation of shares at market value totaling
RUR79,906 million in other expenses and in 2009
also created a provision for the impairment of investments, for which the current market value cannot be
determined, amounting to RUR3,502 million.
Provision for Bad Debts (for Impairment
of Accounts Receivable and Prepayments)
In 2010 as a result of the evaluation of accounts
receivable and prospects for their return, the Company
accrued a provision for bad debts amounting to
RUR14,036 million, and also made a provision reversal
of RUR20,898 million created in 2009. Gain on
reversal and accrual provisions for bad debts totaled
RUR6,862 million.
In 2009 as a result of the evaluation of accounts
receivable and prospects for their return, the Company
accrued a provision on bad debts amounting to
RUR5,902 million, and made a provision of RUR2,734
million for prepayments issued due to changes in the
accounting policy for accruing provisions, as well as
provision reversal of RUR20,017 million for bad
debts.
Current Profit Tax
In 2010 current profit tax increased 90% compared
with 2009 and stood at RUR9,264 million. The said
change in profit tax is due to an increase in profit before profit tax. According to tax accounting records,
2010 taxable profit amounted to RUR46,321 million
(2009: RUR24,382 million).
Net Profit (Loss) for the Reporting Year
In 2010, the Company's net profit equaled RUR58,088
million (2009: a loss of RUR59,866 million). As noted
above, the main reasons for increased profit y-o-y
were profits on other activities, as a result of the revaluation of investments, taking into account current
market value, as well as revenue growth from electric
power transmission. The main reason for 2009 losses
was that the Company’s losses reflected changes in
the current market value of investments in shares
that have market prices.
The Company’s Net Assets, RUR mln
Indicator
2009 ***
Nominal*
Net assets value
579,745.7
2010
Incl.
contributions
to charter
capital*
Nominal**
Incl.
contributions
to charter
capital**
619,923.6
764,162.1
775,357.9
In 2010 the value of the Company’s net assets increased RUR184,416.4 million, according to accounting
statements, compared with the same period in 2009, and by RUR155,434.3 million based on evaluation,
taking into account assumptions.
* In 2009 a procedure was carried out to increase Federal Grid Company's charter capital by issuing additional shares. As a result, in the
2009 fi nancial statements, accounts payable (other current liabilities) reflect a current debt to shareholders related to charter capital
contributions in the amount of RUR40.2 billion. In Q1 2010, aſter the Federal Service for Financial Markets registered a Report on the
additional share issue, this debt was converted into Federal Grid Company's charter capital.
** In 2010 a procedure was carried out to increase Federal Grid Company's charter capital by issuing additional shares. As a result, in the
2010 financial statements, accounts payable (other current liabilities) reflect a current debt to shareholders related to charter capital
contributions in the amount of RUR11.2 billion. In 2011 aſter registering a Report on the additional share issue with the Russian Federal
Service for Financial Markets, this debt will be converted into the Company’s charter capital.
*** Taking into account fi xed asset revaluation as of 01.01.2010, the (nominal) value of net assets was RUR665,895.8, considering
contributions to charter capital – 706,073.6
217
ATTACHMENTS
The Company’s Investment Performance
During 2010 the Company commissioned the following PPE facilities:
Name of the PPE facility
commissioned in 2010*
Power input
Useful life
(years)
Value (RUR mln)
excluding VAT
500 МVА
35
9,947.8
30 km
45
935.5
501 МVА
35
644.4
35
1,779.9
35
5,266.9
45
1,233.1
45
317.7
80 МVА
35
1,277.4
The 400/330-kV Vyborg substation (STATCOM)
50 МVАR
35
250
The 330-kV Tikhvin – Liteynaya substation
(replacement of AT-1 125 MVA)
125 МVА
35
76.3
440 km,
1002 МVА,
360 МVАR
45
11,712.5
34 km, 250 МVА
35
866.4
Cable and overhead transmission lines (110 kV), 1st
stage, Krasnopolyansky Village Districts (design and
survey work, construction)
13,4 km
45
866.1
The Laura substation (110 kV) with power transmission
lines entries (design and survey work, construction)
80 МVА
35
538.6
16 km, 22 МVА
45
2,126.1
80 МVА
35
502.9
100 МVАR
35
519.4
The 500-kV Tikhoretsk substation. Replacement
of AT-1 (125 MVA) (power three-phase three-winding
auto-transformer)-125000/220/110/6, anufactured
in 1964, with a new AT
125 МVА
35
121.2
Replacement of SC with SVC at the 220-kV Slavyanskaya substation (equipping 220-kV substa-tions
of the MES Kuban with Reactive Power Source)
50 МVАR
35
259.7
The 220-kV Vitaminkombinat substation
400 МVА
35
2,312.6
The 220-kV Vostochnaya substation
(installation of AT-2)
125 МVА
35
211.9
297 km, 501 МVА,
180 МVАR
45
7,348.3
Complete technical modernization and reconstruction
of the 500-kV Chagino substation (1st stage of the 1st
start-up complex)
Double circuit 220-kV Nizhegorodskaya – Borskaya
overhead transmission line with one circuit connected
to the 220-kV Nagornaya substation. Contract
No.339/TP, as of 07.02.2008, with MRSK of the Center
and Volga Regions
Expansion of the 500-kV Nizhegorodskaya substation
(installation of the second auto-transformer)
500-kV Lipetskaya substation (modernization
of the auto-transformer)
Construction of the 330-kV Tsentralnaya
St. Petersburg substation
The 220-kV Prospect Ispytateley substation
with line entries
330-kV Yugo-Zapadnaya – Novgorodskaya
OTL entry (due to unavailable 330-kV OS
at Novgorodskaya TPP, the overhead transmission
line was placed under security voltage)
The 220-kV Primorskaya substation
500-kV Volgodonskaya NPP – Nevinnomyssk OTL with
the 500-kV Nevinnomyssk substation with 500-kV
Nevinnomysskaya GRES – Vladikavkaz
OTL entry and 330-kV Stavropol – HPP-4 OTL entry
The 220-kV Cheryomushki substation
with 220-kV OTL entries
The substation (10 kV) and power distribution
networks of the Roza Khutor ski resort
(design and survey work, construction)
The Roza Khutor substation (110 kV) with power transmission
line entries (design and survey work, construction)
Replacement of SC with SVС at the 220-kV Afipskaya
substation (equipping 220-kV substations of the Kuban
Power Grid with the Reactive Power Source)
500-kV Tikhoretskaya – Krymskaya OTL with the 500-kV
Krymskaya substation
218
1503 МVА
25 km, 400 МVА
160 МVА
14 km
FEDERAL GRID COMPANY
Name of the PPE facility
commissioned in 2010*
ANNUAL REPORT
2010
Power input
Useful life
(years)
Value (RUR mln)
excluding VAT
40 km
45
627.4
120 km
45
1,594.2
110 km, 250 МVА
45
3,115.5
The Psou substation (220 kV) (design and survey work,
reconstruction) (complete) reconstruction)
200 МVА
35
1,847.5
Reconstruction of the 220-kV Dagomys substation
400 МVА
35
2,122.1
The 330-kV Chir-Yurt substation (replacement
of AT-2 125 MVA with 200 MVA) ПС 500 кВ
200 МVА
35
186.4
1 km, 1,068 МVА
35
3,637.4
Reconstruction of 220-kV Sredneuralskaya
GRES – Peschanaya 1 OTL and 220-kV Sredneuralskaya
GRES - Kalininskaya OTL
20 km
45
483.1
Double circuit 220-kV Chelyabinskaya TPP-3 –
Novometallurgicheskaya OTL and reconstruction
of 220-kV Novometallurgicheskaya – Kozyrevo OTL
6,4 km
45
295.9
220-kV Novometallurgicheskaya substation
400 МVА
35
1,796.7
220-kV Demyanskaya – Snezhnaya OTL
with installation of AT 125 MVA
at the 220-kV Snezhnaya substation220-kV
125 МVА
35
1,398.3
Magistralnaya – YUBGPZ OTL entries
at the Sredny Balyk substation
of Tyumenenergo (113/TP-M8 dated 24.09.07)
48 km
45
353.8
Double circuit 220-kV Tobolskaya TPP – Irtysh OTL, the
reconstruction of 220-kV switchgear at the 500-kV Irtysh
substation with installation of 3 new switches
20 km
45
622
500-kV Kholmogorskya – Muravlenkovskoye – Tarko-Sale
OTL with 500-kV Muravlenkovskaya substation
668 МVА,
180 МVАR
35
6,225.2
Expansion of the 500-kV Nelym substation (installation of
the 500-kV controlled shunt reactor)
180 МVАR
35
434.9
Expansion of the 500-kV Lugovaya substation (installation
of the second autotransformer group)
501 МVА
35
646
11,4 km
45
1,089.1
604 km, 500 МVА
45
7,473.4
Installation of the capacitor bank at the 500-kV
Alyuminievaya substation
312 МVАR
35
336.9
Installation of the capacitor bank at the 500-kV
Oznachennoye substation
208 МVАR
35
352.7
220-kV Selenduma substation. Installation
of the Static Reactive Power Compensator
for 35 kV. 2x20 M VAR
40 МVАR
35
186.4
220-kV Chesnokovskaya substation
200 МVА
35
1,494.8
220-kV Slavyansk – Krymskaya-II OTL
220-kV Krymskaya – Vyshesteblievskaya OTL
220-kV Slavyansk – Vyshesteblievskaya OTL with
the 220-kV Vyshesteblievskaya substation
The 500-kV Krasnoarmeyskaya substation
with 500, 220-kV OTL entries
Complete reconstruction of the 220-kV
Surgut substation
Constructing two circuits of the 220-kV OTL
Boguchanskaya HPP – Razdolinskaya substation with
the 220-kV Priangarskaya substation and expansion
and renovation of the 220/110/6-kV substation (due to
the nonavailability of Boguchanskaya HPP, the overhead
transmission line was placed under security voltage)
220-kV Artemovskaya TPP – Vladivostok OTL
220-kV Neryungrinskaya GRES –
Nizhniy Kuranakh OTL
220-kV Airport substation with 220-kV power
transmission line entries
40 km
45
423.7
275 km
45
7,627.1
22 km, 50 МVА
35
805.1
*These facilities are in the process of acceptance and state registration; aſter this,
they will be included in PPE for accounting purposes.
219
ATTACHMENTS
Investments in Subsidiaries:
Company name
Company name
31 december 2010
Share in
charter
capital, %
Book value
(including
reserves)
2010
revenue
Net assets
under RAS
as of 31
December,
2010
S&T Elektroenergetika
R&D
100.00
3,895.8
683.9
1,187.4
R&D
System-wide forecasting
and analytical work in the
electric energy industry
100.00
3.5
355.4
173.2
Volgaenergosnabkomplekt
Delivery of materials
and equipment
100.00
0.0
– (1)
– (1)
Glavsetservis UNPG
Services for the
maintenance and repair
of power grid facilities
100.00
1.0
218.8
-541.7
Mobile GTES
Electricity production
100.00
10,594.3
1,806.8
9,819.2
MUS Energetiki
Communication services
100.00
20.0
1,392.2
167.9
UC Energetika
Distribution of encryption
(cryptographic) means
(cryptographic protection
devices)
100.00
55.1
3.8
40.5
CIUS EES
Customer-development
in the field of capital
construction, renovation
and modernization of
electricity supply facilities
100.00
833.0
2,432.3
956.6
CSRI NPKenergo
Management company
services
100.00
0.0
– (1)
– (1)
Eleкtrosetservis UNEG
Services for maintaining
and repairing power
grid facilities
100.00
95.38
3,822.2
1,090.3
ESSK UES
Procurement agent
100.00
133.9
258.1
193.6
Index of Energy-FGC UES
Securities sales
100.00
0.0
42.6
-2,435.4
Chitatekhenergo
Communication services,
reconstructing UNEG
facilities, designing
and operating
communication lines
100.00
4.1
298.5
31.4
Power Generation Center
Operating and
maintaining buildings,
structures and premises
Nurenergo
Transmission, distribution
and sale of electricity
MES Tomsk
Electric energy
distribution and
transmission services
GVC Energetiki
Leaseholder
SMUEK
Energy company
management
DESP
Concurrent engineering
in the power industry
Total investments in subsidiaries
–
(2)
–
(2)
220
(2)
–
(2)
77.00
0,0
2,122.5
-3,684.0
520.25
866.4
114.3
1,194.6
50% plus
1 share
0.2
37.4
310.0
–
(3)
1 share (4)
–
(3)
0.0
17,361.0
1) Does not conduct business activity.
2) Shares were sold on 22 November, 2010.
3) The Company was liquidated 15 February, 2010.
4) Remaining corporate shares are owned by S&T Elektroenergetika, a 100%-owned subsidiary of Federal Grid Company.
Index of Energy – FGC UES owns a minority stake in electricity companies.
–
–
(3)
–
(3)
FEDERAL GRID COMPANY
ANNUAL REPORT
2010
Investments in Dependent Companies:
Company name
Sphere of activity
31 December, 2010
2010
revenue
Net assets
under RAS
as of 31
December,
2010
Share in
chaarter
capital, %
Book value
(incl.
reserves)
Electricity transmission
services
50.00
763.2
254.1 (1)
7,130.3 (1)
Electric energy
transmission and
distribution services
48.99
134.1
102.6
391.3
Production and sale
of electric
and heat energy
49.00
9.8
– (2)
– (2)
Intermediary services to
enterprises and
organizations involved
in operating and
constructing facilities in
the Russian power industry
49.00
0.1
3.5
0.4
Services for the construction
and technical reconstruction
of power industry facilities
45.21
0.0
– (3)
– (3)
Production of electric
and heat energy
40.17
21,851.2
56,466.8
32,828.1
Information technology
services
39.99
19.84
170.1
223.5
ENIN
R&D
38.24
1.0
240.5
93.9
UEUK
Electrical supply
company management
33.33
0.1
0
115.0
Production of electric
and heat energy
29.99
20,066.6
– (2)
– (2)
Production of electric
and heat energy
27.45
2,702.9
– (2)
– (2)
Production of electric
and heat energy
23.58
7,291.2
– (2)
– (2)
Production, transmission and
sale of electric
and heat energy
21.27
15,456.2
– (2)
– (2)
GruzRosenergo IPS
MES Kuban
Severovostokenergo
Energotekhkomplekt
Schekinskie PGU
WGC-1
IT Energy Service
TGC-7
TGC-11
TGC-6
Bashkirenergo
Total investments in associates
68,474.5
1) At the exchange rate RUR100 = 5.81 lari.
2) As of the summary date, the Company’s statements have not been presented.
3) Does not conduct business activity.
221
ATTACHMENTS
Investments in the Shares of Other Companies
Company name
31 December, 2010
Share in Charter
Capital, %
Book value
(incl. reserves)
14.48
316.475
OGK-6
9.60
4,422.283
Energorynok
8.50
0.001
– (1)
– (1)
SOVASATOM
3.38
0.001
Mosenergo
3.37
4,311.255
Natsnenergo
– (1)
1.90
– (1)
Stand
0.83
3.000
– (2)
– (2)
TGC-11 Holding
0.0043
0.054
Tsentrenergoholding
0.0013
0.006
OGK -4
0.0009
1.736
OGK-2
0.0009
0.514
RusHydro
0.0008
3.859
TGC-1
0.0006
0.47
Fortum
0.0006
0.238
Kuzbassenergo
0.0006
0.16
TGK-13
0.0006
0.129
WGC-3
0.0005
0.402
Quadrа
0.0005
0.147
TGC-2
0.0005
0.063
ТGК-9
0.0004
0.186
ТGК-14
0.0004
0.022
ТGК-14
0.0004
0.006
Sangtudinskaya HPP-1
Trest SVES
Sibenergoholding
Total investments in other company’s shares
1) The Company has been liquidated.
2) The block of shares has been sold.
The principal part of investments in shares of the companies listed in the table above was obtained by the Company
due to RAO UES of Russia reorganization. In the long-term, the Company is considering selling these investments.
222
9,061.007
FEDERAL GRID COMPANY
ANNUAL REPORT
2010
Debt Securities
As of 31.12.2010 and 01.01.2010, promissory notes of the following entities
are included in debt securities, RUR thousand:
Issuer’s name
31.12.2010
01.01.2010
Maturity date
Annual interest rate,%
SO-CDA UES
469,300
469,300
December 2012
7%
Energofinans (*)
8,466,381
–
December 2014
Discounted
and interest-bearing
Total debt securities
8,935,681
469,300
(*) Novation of non-interest bearing promissory notes. Previously, the amount was included in receivables. In 2010, a provision
totaling RUR3,618,652 thousand was accrued.
Loans and Other Long-Term Financial Investments
As of 31.12.2010 and 01.01.2010, loans granted included a loan given to Dagenergo in the amount of
RUR296,461 thousand, and a loan to corporate employee in the amount of RUR5,702 thousand as of
31.12.2010 (RUR6,652 thousand as of 01.01.2010). The Company intends to hold all long-term debt investments to their maturity date..
Short-Term Investments
Short-term investments included the following assets, RUR thousand:
Assets
31.12.2010
01.01.2010
Short-term promissory notes
42,356,353
44,190,554
887,671
887,671
3,000,000
24,049,500
46,244,024
69,127,725
Loans granted
Other short-term investments
Total short-term investments
Short-Term Promissory Notes
As of 31.12.2010 and 01.01.2010, short-term promissory notes
include notes from the following companies, RUR thousand:
Issuer name
31.12.2010
01.01.2010
Annual interest rate, %
BANK VTB
19,232,142
43,925,294
Discounted
Alfa-Bank
14,122,562
–
Discounted
AB Rossiya
4,000,000
–
7%
Promsvyazbank
3,001,649
–
Discounted
2,000,00
–
6.25%
Glavsetservis UNEG
–
150,000
14%
Kaustik
–
55,260
15%
GVTs Energetiki (*)
–
60,000
17%
42,356,353
44,190,554
Bank International
Finance Club
Total short-term notes
(*) In 2010, a provision totaling RUR60,000 thousand was accrued.
223
ATTACHMENTS
Loans Granted and Other Long-Term
Financial Investments
As of 31.12.2010 and 01.01.2010, loans granted
included a loan given to Kuban Backbone Network
in the amount of RUR887,671 thousand, as well
as a loan issued to Nurenergo in the amount of
RUR501,300 thousand.
The loan granted to Nurenergo is overdue as of the
reporting date. The Company has no agreements
to prolong this contract. The impairment
provision created in 2006, as of 31.12.2010, totals
RUR501,300.
Other investments as of 31.12.2010 included a bank
deposit in Nomos-Bank, with a maturity of 16.05.2011
in the amount of RUR3,000,000 thousand. As of
01.01.2010, bank deposits in Gazprombank in the
amount of RUR24,049,500 thousand are included.
In 2010, the evaluation of financial investments at
their disposal was made at the initial cost of each
investment.
The Company intends to hold all short-term debt
investments to their maturity date.
Indicators
Cash Flows
As of 31 December, 2010, the Company’s cash
equaled RUR11,243 million (as of 31 December, 2009:
RUR11,312 million).
The below cash inflow and disbursement analysis
is made based on the management reporting of
the Company’s cash flows subject to exceptions for
mutually exclusive deposit turnover.
2010 cash inflow was RUR303,785 million, which
is RUR76,800 million higher the 2009 level. Actual
disbursements increased RUR108,186 million yearon-year and stood at RUR303,854 million.
In 2010, the Company financed investing activities
primarily through cash received from operating activities, repaying bills and selling investments resulting
from the re-organization of RAO UES of Russia, as
well as placing additional shares and raising debt
capital (bond issues).
The Table below provides information on corporate
cash flows from operating, investing and financing
activities during the respective periods.
Total
Types of activity
Operating
Investing
Financing
2010
2009
2010
2009
2010
2009
2010
2009
Revenues
303,785
226,985
147,228
116,471
72,131
66,343
84,426
44,171
Payments
303,854
195,668
68,805
60,675
228,049
111,013
7,000
23,980
-69
31,317
78,423
55,796
-155,918
-44,670
77,426
20,191
Balance
224
FEDERAL GRID COMPANY
Net Cash Generated from Operating Activities
During full year 2010, net cash generated from
operating activities increased RUR30,757 million
(26%) compared with the previous year. This growth
is due to increased earnings from operating activities, including from corporate consumers as a result
of factors addressed in the section “Revenue from
Electricity Transmission Services.” In this case, in
2010, money used for operating activity costs increased by RUR8,130 million (13%) compared with
the previous year due to an increase in profit tax
payment. Without taking into account this factor,
payments from operating activities increased 4%,
which corresponds increased costs due to the impact of factors discussed in the section "Cost."
ANNUAL REPORT
2010
Net Cash Generated from Financing Activities
In 2010, cash from fi nancing activities increased
more than 1.9 times and totaled RUR84,426 million,
including cash flow for placing temporarily free funds
(RUR23,240 million), revenues from the Company’s
additional share issue amounted to RUR11,194
(2009: RUR40,171 million) and placement of the
bond issues in the amount of RUR50,000 million to
finance the investment program. In 2010, the Company redeemed the Series 2 bond issue amounting
to RUR7,000 million.
Net Cash Used in Investing Activities
In 2010, cash used in investing activities increased
RUR117,036 million compared to the previous year,
including RUR60,987 million for investment rogram
financing. In 2010, net cash outflows used in the
Company’s investing activities increased compared
with 2009, as a result of a more than 1.5 times
increase in the investment program and recording
transactions for the purchase and sales of securities
to finance the investment program in the future.
225
ATTACHMENTS
COMPLIANCE WITH THE CODE OF
CORPORATE GOVERNANCE
№ CGC Article
Compliant
Note
/ Non-compliant
General Shareholders Meeting
1
Notifying shareholders about
the General Shareholders Meeting
at least 30 days prior to the meeting
date irrespective of items included
on the agenda, unless a longer
notice is stipulated by legislation.
Compliant
Item 11.4 of Article 11 of the Articles
of Association
2
Shareholders' opportunity to examine
the list of persons authorized
to participate in the General Shareholders
Meeting, starting from the notification date
for the General Shareholders Meeting
through to closing the internal General
Shareholders Meeting, and in case
of a meeting held in absentia till the date
for receiving voting ballots expires.
Compliant
Any person holding at least
1 percent of votes is entitled to this.
Document data and postal addresses
for individuals included on this list
are provided only at the consent
of these individuals.
3
Shareholders' opportunity
to examine information (materials)
which are to be submitted during
preparation for the General Shareholders
Meeting, via electronic communication,
including the Internet.
Compliant
Conforms with Article 52 of the Federal Law
“On Joint Stock Companies,” Federal Grid
Company's shareholders are entitled to within
20 days prior to the General Meeting, and within
30 days prior to the General Meeting in case
the General Shareholders Meeting includes
an agenda item on reorganizing the Company,
to examine materials for the General
Shareholders Meeting on the Internet.
The information is published on the Company’s
web site at http://www.fsk-ees.ru/eng/ ,
in the Shareholders and Investors section.
4
Shareholders’ opportunity to submit an item
Partially
for the agenda of the General Shareholders
compliant
Meeting or to demand calling a General
Shareholders Meeting without giving
an extract from the register of shareholders
if their rights to shares are registered
in the register of shareholders, and the sufficiency
of an extract from the deposit account for
executing the abovementioned rights if their rights
to shares are registered on the deposit account.
In accordance with Item 4.7 of the Regulations
on the Procedure for Preparing and Holding
the General Shareholders Meeting, when
an item is submitted to the agenda or when
an Extraordinary General Shareholders
Meeting is called, a shareholder’s possession
of shares, the rights to which are considered
according to the deposit account in the
depository, is confirmed by providing
an extract from the deposit account.
5
Provision in the Charter or internal documents
Partially
of the joint stock company to require the
compliant
obligatory presence of the General Director,
members of the Management Board,
members of the Board of Directors, members of the
Audit Commission and the auditor of the joint stock
company at the GeneralShareholders Meeting.The
obligatory presence of candidates during the
consideration of items related to electing members
of the Company’s Board of Directors, the General
Director, members of the Management Board,
members of the Audit Commission, as well as the
item on approving the auditor of the joint stock
company at the General Shareholders Meeting.
Item 7.2 of the Regulations on the Procedure
for Preparing and Holding the General
Shareholders Meeting requires that
the Chairman of the Board of Directors
or members of the Board of Directors be present.
6
A registration procedure for participants
in the General Shareholders Meeting in the
internal documents of the joint stock company.
Non-compliant
This requirement is not provided for by any
corporate internal documents
7
Provision in the Charter of the joint stock
company for the Board of Directors’ authority
to approve on an annual basis the financial
and economic plan of the joint stock company.
Compliant
Item 5.1 of the Article of the Regulations
on the Procedure for Preparing and Holding
the General Shareholders Meeting
226
FEDERAL GRID COMPANY
№ CGC Article
ANNUAL REPORT
2010
Compliant
Note
/ Non-compliant
Board of Directors
8
A risk management procedure for
the joint stock company approved
by the Board of Directors
Compliant
In accordance with Item 33 Item 15.1 of Article
15 of the Company’s Articles of Association, the
areas of competency for the Board of Directors
includes approving the business plan and targets
for the Company’s key performance indicators.
9
Provision in the Charter of the joint
stock company regarding the right
of the Board of Directors to make
a decision on suspending the authority
of the General Director appointed
by the General Shareholders Meeting
Non-compliant
This procedure, or any other regulatory
document, was not approved by the Company’s
Board of Directors as separate documents.
10 Provision in the Charter of the joint stock
company of the right of the Board of Directors
to establish requirements for professional
skills and remuneration for the General
Director, members of the Management
Board and heads of the primary structural
divisions of the joint stock company
Non-compliant
Functions of the Company’s sole executive
body are performed by the Chairman of the
Company’s Management Board. In accordance
with Sub-item 10 of Item 10.1 of Article 10 of
the Company’s Articles of Association, the
Chairman’s election and early termination is
an area that falls under the competency of the
Company’s General Shareholders Meeting.
11 Provision in the Charter of the joint stock
company of the right of the Board of Directors
to approve contract terms with the General
Director and members of the Management Board
Partially
compliant
In accordance with Sub-items 10 and 37 of Item
15.1 of Article 15 of the Company’s Articles
of Association, areas of competency that fall
under the Company’s Board of Directors include
establishing remuneration and compensation for
members of the Company’s Management Board
and prematurely terminating their authority,
including decisions on the early termination
of their employment contracts.
12 Provision in the Charter or internal documents
of the joint stock company for the requirement
stating that votes of members of the Board
of Directors who are either the General
Director or members of the Management
Compliant
Sub-item 37 of Item 15.1 of Article 15
of the Company’s Articles of Association.
13 Board are not taken into account when voting
to approve contract terms with General
Director (a management organization
or the managing director) and members
of the Management Board
Non-compliant
This requirement is not provided for
by the Company’s Articles of Association
or any other documents.
14 Presence on the Board of Directors of the joint
stock company of at least three independent
directors that meet requirements of the
Corporate Conduct Code
Compliant
In accordance with a decision of Federal Grid
Company's Annual General Shareholders Meeting
on 29 June, 2010, the following directors meeting
independence requirements were included on the
Company’s Board of Directors: Rashid Sharipov,
Igor Khvalin, Ernesto Ferlenghi, and Yuri Soloviev.
15 Absence in the composition of the Board
of Directors of the joint stock company
of persons who were found guilty of committing
crimes in the sphere of economic activities
or crimes against the government, interests
of public service and service to local government
institutions or who had administrative
punishments applied to them for violations
of the law in the area of entrepreneurial activity
or in the area of finance, tax and tax collection
and securities market
Compliant
There are no such persons in the composition
of the Company’s Boards of Directors valid
throughout 2010.
16 Absence in the composition of the Board
of Directors of the joint stock company
of persons who are participants, the General
Director (managing director), member
Compliant
There are no such persons in the composition
of the Company’s Boards of Directors valid
throughout 2010.
227
ATTACHMENTS
№ CGC Article
Compliant
Note
/ Non-compliant
17 of a regulatory body or employee
of a legal entity that competes with the
joint stock company
Compliant
Sub-item 10.9 of Article 10 of the Company’s
Articles of Association.
18 Requirement in the Charter of the joint stock
company to elect the Board of Directors
via cumulative voting
Compliant
Sub-item 4.1.6 of Item 4.1 of Section 4 of the
Company’s Code of Corporate Governance.
19 Provision in the internal documents of the joint
stock company of the obligation of members
of the Board of Directors to withdraw from
actions that lead or potentially lead to a conflict
between their interests and the interests
of the joint stock company; obligation
to disclose information on this conflict
to the Board of Directors in case it occurs
Compliant
Item 16.9 of Article 16 of the Company’s
Articles of Association;
20 Provision in the internal documents of the joint
stock company of members of the Board
of Directors duty to notify the Board of Directors
in writing of their intention to make transactions
with securities of the joint stock company, if they
are members of the Board of Directors of this
joint stock company or its subsidiaries or
dependent companies, as well as to disclose
information about the transactions with such
securities made by them Provision in the internal
documents of the joint stock company of the
requirement to hold at least one meeting of the
Board of Directors every six weeks
Non-compliant
On average in 2010, meetings of the Company’s
Board of Directors were held at least once per
month or more.
21 Meetings of the Board of Directors
of the joint stock company during the year
which is the subject of the annual report
of the joint stock company are carried out
regularly, at least one meeting every six weeks
Compliant
The Regulations on the Board of Directors.
22 Provision in the internal documents of the
joint stock company of a procedure for holding
meetings of the Board of Directors
Compliant
Sub-item 27 (a) of Item 15.1 of Article 15 of the
Company’s Articles of Association stipulates
that the Board of Director grants preliminary
approval for corporate transactions that
have the non-current assets worth more than
10 percent of the balance sheet value as the
object of the transactions.
23 Provision in the internal documents of the joint
stock company of regulations on the necessity
of the Company’s Board of Directors approving
transactions in an amount of 10 percent and
more of the cost of the Company’s assets,
except for transactions made as part of the
Company’s dayto- day economic activity
Partially
compliant
In accordance with Section 3
of the Regulations on the Board of Directors,
members of the Company’s Board of Directors
are entitled to receive information about the
Company’s operations, including commercial
secrets, and access all constituent, normative,
reporting, accounting, contractual and other
corporate documents.
24 Provision in the internal documents
of the joint stock company of the right
of members of the Board of Directors
to receive information required to perform
their functions from executive bodies
and heads of the Company’s main structural
divisions, as well as responsibility for
the failure to provide such information
Compliant
Establishing the Strategy Committee was
approved by a decision of the Company’s Board
of Directors as of 15 May, 2008 (Minutes No. 62).
Operation procedures are laid out by the
Regulations on the Strategy Committee
of Federal Grid Company.
Section 3 of the Regulations on the Board
of Directors;
Item 4 of the Regulations on the Insider
Information, Subitem
This requirement is not provided for by the
Company’s Articles of Association or by any
other documents.
25 The existence of a Strategic Planning Committee Compliant
of the Board of Directors or another committee
assigned with said functions (except for the Audit
Committee and the Human Resources
and Remuneration Committee)
228
Establishing the Audit Committee was
approved by a decision of the Company’s
Board of Directors as of 15 February,
2008 (Minutes No. 54).
FEDERAL GRID COMPANY
ANNUAL REPORT
2010
№ CGC Article
Compliant
Note
/ Non-compliant
26 The existence of a committee of the Board
of Directors (the Audit Committee) which
recommends the auditor for the joint stock
company to the Board of Directors
and cooperates with the auditor and the Audit
Commission of the joint stock company.
Compliant
Operation procedures are laid out by the
Regulations on the Audit Committee of the Board
of Directors of Federal Grid Company.
27 Presence of only independent and non-executive
directors on the Audit Committee
Compliant
The Audit Committee consists only of
independent and nonexecutive directors.
28 The Audit Committee is managed by an
independent director
Compliant
The Audit Committee of the Company’s
Board of Directors is managed by independent
director Rashid Sharipov.
29 Provision in internal documents of the joint
stock company of the right of all members of the
Audit Committee to access any documents and
information of the joint stock company provided
that they do not disclose confidential information
Compliant
Section 3 and 4 of the Regulations on the Audit
Committee of the Board of Directors of Federal
Grid Company.
Establishing a committee of the Board
30 of Directors (the Human Resources and
Remuneration Committee) with the function
of defining recruitment criteria for candidates
applying for positions of members of the
Board of Directors and developing the joint
stock company’s remuneration policy
Compliant
The HR and Remuneration Committee was
established by a decision of the Company’s
Board of Directors as of 15 February, 2008
(Minutes No. 54).
31 The Human Resources and Remuneration
Committee is managed by an independent
director
Compliant
Item 5.2 of the Regulations on the HR
and Remuneration Committee of the Board
of Directors of Federal Grid Company.
32 The absence of officials of the joint stock
company on the Human Resources
and Remuneration Committee
Compliant
Item 5.2 of the Regulations on the HR
and Remuneration Committee of the Board
of Directors of Federal Grid Company.
33 Establishing the Risk Committee under
the Board of Directors or assigning these
functions to another committee (except
for the Audit Committee and the Human
Resources and Remuneration Committee)
Non-compliant
The Committee was not established.
34 Establishing the Corporate Conflicts Settlement
Non-compliant
Committee of the Board of Directors or assigning
these functions to another committee (except
for the Audit Committee and the Human
Resources and Remuneration Committee)
The Committee was not established.
35 The absence of joint stock company officials on
the Corporate Conflicts Settlement Committee
Non-compliant
The Committee was not established.
36 The Corporate Conflicts Settlement Committee
is managed by an independent director
Non-compliant
The Committee was not established.
37 Provisions in internal documents of the joint
stock company of procedures for establishing
and operating Board of Directors’ Committees,
approved by the Board of Directors
Compliant
Regulations: On the Audit Committee, On the
HR and Remuneration Committee, On the
Reliability Committee of the Board of Directors,
On the Strategy Committee, On the Investment
Committee.
38 Provision in the Charter of the joint stock
company on the process for defining the quorum
for the Board of Directors, allowed to provide
for the obligatory participation of independent
directors in Board of Directors’ meetings
Non-compliant
This requirement is not provided
for by the Company’s
Articles of Association.
The procedure for the Committee’s operations
is laid out by the Regulations on the HR and
Remuneration Committee of the Board of
Directors of Federal Grid Company.
229
ATTACHMENTS
№ CGC Article
Compliant
Note
/ Non-compliant
39 Provision of the collegial executive
body (Management Board) of the joint
stock company
Compliant
The Company’s Management Board was
formed in accordance with Article 21
of the Articles of Association.
40 Provision in the Charter or internal documents
Partially
of the joint stock company on regulations
compliant
on the necessity of the Management Board’s
approval of transactions with real estate and
loans taken out by the joint stock company
provided that said transactions are not deemed
major transactions and are not part of day-to-day
economic activities of the joint stock company
This requirement is not provided for by the
Company’sArticles of Association. In accordance
with the Company’s Articles of Association, it is an
area of competency under the Board of Directors.
At the same time, however, in accordance with
Item 6.1 of the Regulations on the Preparation
of Materials for the anagement Board’s Meetings,
all questions submitted for consideration to the
Company’s Board of Directors are subject to
mandatory preliminary considerations by the
Company’s Management Board.
41 Provision in the internal documents of the
joint stock company of the procedure for
approving operations beyond the financial
and economic plan of the joint stock company
Partially
compliant
This requirement is not provided for by the
Company’s Articles of Association or any other
documents.
42 Absence in the composition of executive
bodies of persons who are either participants,
the General Director (managing director),
members of the management body or
employees of a legal entity that competes
with the joint stock company
Compliant
There are no such persons in the executive body.
43 Absence in the structure of the executive bodies
Compliant
of the joint stock company of persons who were
found guilty of committing crimes in the area
of economic activities or crimes against the
government, interests of public service and service
in local government institutions, or of persons who
experienced administrative punishments for
violations in the area of business activity or in the
area of finance, taxes, fiscal charges and the
securities market. If functions of the sole executive
body are carried out by a management organization
or a managing director, the General Director
and members of the Management Board of the
management organization or the managing director
must meet the requirements of theу General
Director and members of the Management
Board of the joint stock company
There are no such persons in the executive body.
44 Provision in the Charter or internal documents
Non-compliant
of the joint stock company to prohibit the
management organization (managing director)
from carrying out similar functions in a competing
company, as well as to be in any other material
relationship with the joint stock company, besides
rendering services of the management organization
(managing director)
This prohibition is not provided for by
the Company’s the Articles of Association
or by any other documents.
45 Provision in internal documents of the joint stock
company of the duties of executive bodies to
withdraw from actions leading or potentially
leading to a conflict of interest and the interests
of the joint stock company, and duties to inform
the Board of Directors if such a conflict occurs
Item 4.1.6 of the Company’s Code of Corporate
Governance.
230
In part, these questions are outlined by the
Regulations on the Procedure for Placing
Temporarily Disposable Free Funds of Federal
Grid Company (approved by the Management
Board of Federal Grid Company, Minutes
No. 528 as of 24 April, 2008) and by the
Regulations on Debt Management Procedure
(approved by the Company’s Board of Directors,
Minutes No. 44 as of 29 May, 2007).
Compliant
FEDERAL GRID COMPANY
ANNUAL REPORT
2010
№ CGC Article
Compliant
Note
/ Non-compliant
46 Provision in the Charter or internal documents
of the joint stock company of criteria for
electing the management organization
(managing director)
Non-compliant
The Company’s the Articles of Association or any
other documents do not lay out any selection
criteria for management organizations.
47 The joint stock company’s executive bodies
present monthly performance reports
to the Board of Directors
Non-compliant
Reports by the executive body are provided
on a quarterly basis (Sub-item 14 of Item 22.1
of Article 22 of the Company's Articles of
Association).
48 Liability for infringing on provisions for using
confidential and proprietary information stated
in contracts concluded by the joint stock
company with the General Director (management
organization, managing director) and members
of the Management Board
Compliant
Contracts signed by the Company with
the Chairman of the Management Board
and members of the Management Board outline
the liability for violations of provisions on the
use of confidential and proprietary information.
49 Presence in the joint stock company of
a special official (the Company Secretary)
whose task is to ensure the compliance
of bodies and officials of the joint stock company
with procedural requirements guaranteeing
the execution of rights and legitimate interests
of the Company’s shareholders
Compliant
The function is performed by the Secretary
of theCompany’s Board of Directors.
50 The process of appointing (electing)
the Company Secretary and his/her duties
are stipulated by the Charter or internal
documents of the joint stock company
Compliant
Article 4 of the Regulations on the Board
of Directors
51 Provision in the Charter of the joint stock
company for requirements for candidates
for the Company Secretary position
Non-compliant
Compliant
There are no such requirements.
52 Requirement in the Charter or internal documents
of the joint stock company to approve a major
transaction prior to its fulfillment
Compliant
Sub-item 16 of Item 10.2 of Article 10
and Sub-item 20 of Item 15.1 of Article 15
of the Company's Articles of Association.
53 Obligatory involvement of an independent
appraiser in evaluating the market value
of property which is the subject of
a major transaction
Non-compliant
Said deals involve the services
of an independent appraiser.
54 Presence in the Charter of the joint stock
company a prohibition to undertake any action
when acquiring (taking over) a large stake
of shares of the joint stock company (takeover)
aimed at protecting the interests of executive
bodies (members of these bodies) and members
of the Board of Directors of the joint stock
company, as well as actions worsening the
shareholders’ position compared to their existing
position (in particular, a prohibition against
the Board of Directors on making decisions
on the issue of additional shares, the issue
of securities that are convertible into shares
or securities enabling a person to purchase
shares of the Company before the termination
of the Prospectus even if the right to make
these decisions is granted by the Charter)
Non-compliant
This prohibition is not provided for by the
Company's Articles of Association.
Requirement in the Charter of the joint stock
55 company of the obligatory involvement of an
independent appraiser to estimate the current
market share price and possible changes in the
share price as the result of a takeover
Compliant
This requirement is not provided for by the
Company's Articles of Association.
Executive Bodies
Company Secretary
231
ATTACHMENTS
№ CGC Article
Compliant
Note
/ Non-compliant
56 Absence in the Charter of the joint stock company Non-compliant
of the release of a purchaser from their duty
to make an offer to shareholders to sell their
ordinary shares (securities issue that is convertible
into ordinary shares) during a takeover
This norm is not provided for by the Company's
Articles of Association.
57 Presence in the Charter or internal documents
of the joint stock company of the requirement
for the obligatory involvement of an
independent appraiser in defining the share
conversion ratio during reorganization
This requirement is not provided for
by the Company's Articles of Association
or any other documents.
Compliant
Material Corporate Actions
58 An internal document approved by the Board
Non-compliant
of Directors that outlines rules and approaches
of the joint stock company to information
disclosure (Regulations on the Information Policy)
The Regulations on the Information Policy was
approved by the Company’s Board of Directors
on 28 February, 2008 (Minutes No. 55).
59 Existence of internal documents of the joint stock
Compliant
company that require the disclosure of information
about the purpose of the share issue, about persons
intending to purchase shares to be issued, including
a large shareholding and about whether executives
of the joint stock company participate in purchases
of the Company’s shares to be issued
This requirement is not provided for
by the Company's Articles of Association
or any other documents.
60 Existence of a list of information, documents
and data in internal documents of the joint stock
company which should be given to shareholders
for making decisions on items submitted
to the General Shareholders Meeting
Article 11 and Article 12 of the Company's
Articles of Association;
Section 7 of the Regulations
on the Information Policy.
Compliant
61 A web site of the joint stock company on the Internet Compliant
that regularly discloses information on the joint
stock company (on the web site)
http://www.fsk-ees.ru/
62 Presence in internal documents of the joint stock
company of the requirement to disclose information
about transactions of the joint stock company made
with persons who according to the Charter
are among executives of the joint stock company,
as well as about transactions of the joint stock
company made with organizations in which
executives of the joint stock company hold, directly
or indirectly, 20 percent of the authorized capital
of the joint stock company and above or which
can be essentially influenced by said persons
In accordance with Sub-item 5.2.8
of the Company’s Regulations
on the Information Policy.
63 Presence in internal documents of the joint stock
company the requirement to disclose information
about all transactions which can influence the
market price of the Company’s shares
Compliant
In accordance with Items 5.1 and 5.2.10
of the Company’s Regulations
on the Information Policy.
64 An internal document approved by the Board
of Directors on using essential information
on the operations of the joint stock company,
shares and other corporate securities and
transactions with them which are not public
and the disclosure of which could materially
influence the market price of shares and
other securities of the joint stock company
Compliant
In 2010, the Regulations on the Insider
Information which was approved
by the Company’s Board of Directors
on 28 February, 2008 (Minutes No. 55),
was in effect.
232
The new Regulations on the Insider Information
was approved by a decision of the Company’s
Board of Directors dated 15 March, 2011
(Minutes No. 125).
FEDERAL GRID COMPANY
№ CGC Article
ANNUAL REPORT
2010
Compliant
Note
/ Non-compliant
Information Disclosure
65 Internal control procedures over the financial
and economic activity of the joint
stock company are approved by the Company’s
Board of Directors]
Compliant
Control norms are laid out by the Company's
Regulations approved by the Board of Directors:
Regulations on the Audit Commission
and Regulations on the Internal Control System.
66 A special division of the joint stock company
which enforces the execution of internal
control procedures (supervision
and auditing service)
Compliant
Control and Audit Department – responsible for:
• Organizing control procedures for the financial,
production and economic activities of Federal
Grid Company and its subsidiaries or dependent
companies, aimed at preventing, revealing,
terminating and eliminating consequences of
violations in managing monetary and material
resources;
• Organizing selective control procedures to
check the compliance of financial and economic
transactions carried out by structural divisions
of the executive bodies and branches of the
Company with Russian legislation;
• Investigating abuse (fraud) incidents;
• Interacting with external control bodies;
• Providing informational support to the Audit
Commission of Federal Grid Company and
ensuring the enforcement of its guidelines and
decisions.
Internal Control Department – responsible for:
• Developing and upgrading the methodology
and organizational principles of the internal
control system of Federal Grid Company,
efficiently analyzing the internal control
system across all operational areas,
developing guidelines aimed at improving the
efficiency of the internal control system;
• Organizing current internal control procedures
for accounting at Federal Grid Company,
organizing current internal inspections
for accounting and operating information,
organizing operating control procedures
for information about planned and actual
performance results for Federal Grid Company
branches, its subsidiaries and dependent
companies;
• Identifying and analyzing risks for Federal
Grid Company, developing and updating the
Risk Matrix, developing recommendations
aimed at risk reduction and prevention;
• Analyzing operating control and efficiency for
• accounting processes at Federal Grid
company and its subsidiaries and dependent
companies;
• Conducting an efficiency analysis for the
authority allocation system and limits of
financial responsibility across management
levels at Federal Grid Company;
• ФDeveloping and upgrading the Delegation
of Authority Matrix, controlling compliance
with principles of authority allocation and
financial responsibility limits.
Technical Surveillance and Auditing Department
–responsible for:
• Carrying out audit inspections of production
and technical operations at the Company’s
subsidiaries and branches in accordance
with plans (and on an unscheduled basis if
requested by corporate management) and
with technical audit programs;
233
ATTACHMENTS
№ CGC Article
Compliant
Note
/ Non-compliant
•
•
•
•
•
•
•
•
67 The presence in internal documents of
a requirement by the Board of Directors
of the joint stock company about defining
the structure and composition of
the supervisory and auditing services
of the joint stock company
Compliant
Conducting inspections and efficiency
evaluations of the existing internal technical
control system at the Company’s branches
(structures of technical inspection, internal
technical and production control and selfcontrol), analyzing the performance of these
structures as compared to risks emerging
during production operations;
Engaging in sample estimates of the
completeness and reliability of regular
technical reports on production processes,
achieving target figures across key efficiency
indicators;
When requested by the Company’s
management, organizing and participating
in investigating accidents and socially
important technological violations in electric
grid performance;
Forecasting (based on the integrated analysis
of investigation results and accident data,
production injuries and fire incidents) possible
consequences of negative trends and risks
of reduced systemic reliability and equipment
safety and personnel performance;
Preparing and enforcing control over the
implementation of managerial decisions
aimed at upgrading the correctness and
completeness of the use of technical
standards and corporate regulations based
on analyzing investigations of production and
technical operations;
Developing and presenting recommendations
and proposals on improving and optimizing
production business processes at the
Company’s branches based on technical
audit results;
Preparing conclusions and materials for
meetings of the Company’s Management
Board, the Board of Directors and General
Meetings of Shareholders following the
technical audit;
Developing proposals aimed at improving
the Company’s operations in identifying
and managing environmental risks.
The Company's Regulations on the Internal
Control System outlines participants in the
internal control system, structural divisions
of the Company responsible for controlling
and auditing the Company’s financial, economic
and investment activities.
68 Absence in the supervisory and auditing services Compliant
of persons who were found guilty of committing
crimes in the area of economic activities or crimes
against the government, interests of public service
and service of local government institutions, or
persons who had administrative punishments
applied to them for violations in the area of
business activity or in the areas of finance, taxes,
fiscal charges and the securities market
There are no such persons in the Company’s
supervision and auditing services.
69 Absence in the composition of the supervisory
Compliant
and auditing services of persons who are
members of any executive body of the joint stock
company, and persons who are participants, the
General Director (managing director), members of
management bodies or employees of a legal entity
that competes with the joint stock company.
There are no such persons in the Company’s
supervisory and auditing services.
234
FEDERAL GRID COMPANY
ANNUAL REPORT
2010
№ CGC Article
Compliant
Note
/ Non-compliant
70 Presence in internal documents of the joint
stock company of a timeframe for presenting
documents and data to the supervisory
and auditing services for estimating the
financial and economic operations carried out,
and the responsibility of officials and employees
of the joint stock company for their failure
to present documents and data within the
specified timeframe
Compliant
Item 7 of the Regulations on the Audit
Commission.
71 Presence in the internal documents of the joint
stock company of the supervisory and auditing
services’ duty to inform the Audit Committee
about revealed infringements, and in case
of the latter’s absence, presence of a duty
to inform the Board of Directors of the joint
stock company of said infringements
Compliant
Item 4 of the Regulations on the Audit
Commission.
72 Presence in the Charter of the joint stock
company of the requirement for a preliminary
estimation by the supervisory and auditing
services of the feasibility of operations
not included in the financial and economic plan
of the joint stock company (non-standard
operations)
Non-compliant
This requirement is not provided for by the
Company's Articles of Association.
73 Presence in the internal documents
of the joint stock company a coordinated
procedure for non-standard operations
with the Board of Directors
Non-compliant
This procedure is not laid out by internal
documents.
Compliant
74 An internal document approved by the Board
of Directors that defines the Audit Commission ’s
inspection procedure for the joint stock company’s
financial and economic activity
The Regulations on the Audit Commission
and the Regulations on the Internal Control.
75 The Audit Committee’s evaluation of the Auditor’s Compliant
Report prior to its presentation to shareholders
at the General Shareholders Meeting
Item 2.1.4 of Section 2 of the Regulations
on the Audit Committee of the Board
of Directors of Federal Grid Company.
Control over Financial and Economic Activity
76 An internal document approved by the Board
of Directors and used by the Board of Directors
as guidelines for approving recommendations
on dividend amount (Dividend Policy Regulations)
Compliant
The Company’s Regulations on the Dividend
Policy approved by a decision of Federal
Grid Company's Board of Directors
as of 16 December, 2010 (Minutes No. 120).
77 Presence in the Dividend Policy Regulations
on rules defining the minimum share of the joint
stock company’s net profit allocated to dividend
payments, and conditions for the non-payment
or partial payment of dividends on preferred
shares, which have dividend size outlined
in the Charter of the joint stock company.
Compliant
Item 4.3 in the Regulations on the Dividend
Policy.
Compliant
78 Publication on information about the joint
stock company’s dividend policy and
amendments to it in the periodic publication
outlined by the Charter of the joint stock company
for publishing information about the General
Shareholders Meeting, and publication of said
data on the joint stock company’s web site
on the Internet.
The Company’s Regulations on the Dividend
Policy is published on the Company’s official
web site at: http://www.fskees.ru/eng/investors/
corporate_governance/corporate_docu ments/
media/File/Internal%20documents/Regulations_
Divid end_Policy.pdf
235
ATTACHMENTS
2010 GENERAL SHAREHOLDERS MEETINGS
The General Shareholders Meeting
held 29 June, 2010:
The following agenda for the General Shareholders
Meeting was approved by a resolution of Federal Grid
Company’s Board of Directors (14 May, 2010):
1. Approving the Company’s Annual Report;
2. Approving the Company Annual Financial Statements, including the profit and loss statement
(profit and loss accounts);
3. Approving the Company’s 2009 earnings distribution;
4. Determining dividends, dates and the form of
2009 dividend payments;
5. Paying remuneration to non-state members
of the Company’s Board of Directors (the
Supervisory Board) for work as Directors in an
amount determined by the Company’s internal
documents;
6.
Electing members of the Company’s Board
of Directors (the Supervisory Board);
7. Electing members of the Company’s Audit Commission (the examiner);
8. Approving the Company’s Auditor;
9. Approving the new version of the Company’s
Articles of Association;
10. Approving the new versions of the Company’s
internal documents.
The Annual General Shareholders Meeting held 29
June, 2010 (Minutes No.9 as of 29.06.2010), carried
out the following resolutions:
1. Approved the Company’s 2009 Annual Report;
2. Approved the Company’s Annual Financial Statements, including the profit and loss statements
(profit and loss accounts);
3. Approve the Company’s 2009 profits and losses
to be distributed as follows:
(RUR thousand)
Undistributed profit (loss) for the reporting period:
To be distributed to the Reserve Fund
-59,865.994

Development

Dividends

4.
5.
Decided not to pay dividends on ordinary shares in 2009;
Approved the new version of the Regulations on Compensation and Remuneration to Members
of the Board of Directors;
6. Elected the Board of Directors made up of the following members:
7. No Full Name Position
8. Approved PricewaterhouseCoopers Audit as the Company’s Auditor;
9. Approved a new version of the Company’s Articles of Association;
10. Approved a new version of the Regulations on the Procedure for Preparing and Holding the General
Shareholders Meeting.
№
Full Name
Position
1
Boris Ayuyev
Chairman of the Management Board of SO UES
2
Oleg Budargin
Chairman of the Management Board of Federal Grid Company
3
Georgy Kutovoy
Director of the Energy Research Institute of the Russian Academy of Sciences
4
Alexey Makarov
Deputy Director General of Rosnanotech State Corporation
236
FEDERAL GRID COMPANY
ANNUAL REPORT
2010
№
Full Name
Full Name
5
Andrei Malyshev
Deputy Director General of Rosnanotech State Corporation
6
Dmitry Ponomarev
Chairman of the Management Board of Non-Commercial Partnership
"Market Council" (the Market Council)
7
Yuri Soloviev
President of VTB Capital
8
Ernesto Ferlenghi
Head of the Representative Office of Eni Russia and the CIS
9
Igor Khvalin
General Director of Volga Engineering Group
10
Rashid Sharipov
Deputy General Director of KFK-Consult
11
Sergei Shmatko
Sergei Shmatko
№
Full Name
Position
1
Dmitry Gorevoi
Leading expert in a Department of the Russian
Ministry for Economic Development
2
Anna Drokova
Leading expert in a Department of the Federal Agency for State
Property Management of the Russian Federation
3
Andrei Kolyada
Leading expert in a Department of the Federal Agency for State
Property Management of the Russian Federation
4
Vladimir Raspopov
Head of a Department of the Federal Agency for State
Property Management of the Russian Federation
5
Maria Tikhonova
Director of a Department of the Russian Ministry of Energy
237
ATTACHMENTS
BRANCHES
Information on Federal Grid Company's branches
1
MES Center
1 Tkatskaya Street, Moscow, Russia,105318
2
MES North-West
1 Kurchatov Street, Saint Petersburg, Russia, 194223
3
MES Volga
226 Molodogvardeiskaya Street, Samara, Russia, 443100
4
MES South
2 Darnitsky LA, Inozemtsevo Settlement,
Zheleznovodsk, Russia
5
MES Urals
10 Tolmachov Street, Yekaterinburg, Russia, 620219
6
MES Siberia
117 Ada Lebedeva Street, Krasnoyarsk, Russia, 660099
7
MES East
47 Dzerzhinsky Street, Khabarovsk, Russia,
630030630030, г. Хабаровск, ул. Дзержинского, 47
8
Nizhegorodskoe PMES
29 Schlisselburgskaya Street, Nizhny
Novgorod, Russia, 603600
9
Chernozemnoe PMES
Sh-5 Passage, Building 1, the Stroitelnaya Site,
the Kotel Station Industrial Zone, Stary
Oskol, the Belgorod Region, Russia, 309540
10
Volga-Okskoe PMES
31 Energetikov Street, the Energetik
Settlement, Vladimir, Russia, 600902
11
Volga-Don PMES
221a Lenin Ave., Volgograd, Russia, 400006
12
Vologodskoe PMES
18 Planernaya Street, Vologda, Russia, 160023
13
Priokskoe PMES
101A Timiryazev Street, Tula, Russia, 300012
14
Moscow PMES
The 750-kV substation, the Bely Rast Production Facility,
the Dmitrovsky District, the Moscow Region, Russia, 141870
15
Upper Don PMES
Komsomolets Settlement, the Tambov Region, Russia, 392543
16
Valdaiskoe PMES
Tver, 55 Kalinin Ave., Tver, Russia, 170001
17
Amurskoe PMES
101 Shatkovskogo Street, Svobodny,
the Amur Region, Russia, 676400
18
Khabarovskoe PMES
3 Tselinnaya Street, Khabarovsk,
the Khabarovsk Region, Russia, 680032
19
Primorskoe PMES
3 Mordovtsev Street, Vladivostok,
the Primorsk Region, Russia, 690000
20
Krasnoyarskoe PMES
3A Vesny Street, Krasnoyarsk,
the Krasnoyarsk Region, Russia, 660135
21
Zabaikalskoe PMES
35B Botanicheskaya Street, Ulan-Ude,
the Republic of Buryatia, Russia, 670045
22
Kuzbasskoe PMES
25a Kirchanov Street, Kemerovo, Russia, 650004
23
Omskoe PMES
4 Gubkin Ave., Omsk, Russia, 644035
24
West-Siberia PMES
17 Kalinin Ave., Barnaul, Russia, 656002
25
Khakassia PMES
39 Industrialnaya Street, Sayanogorsk,
the Republic of Khakassia, Russia, 662793
26
Sverdlovskoe PMES
3 Malakhitovy Lane, Yekaterinburg,
the Sverdlovsk Region, Russia, 620085
27
South Urals PMES
6a 2nd Zapadny Proezd Street, Chelyabinsk, Russia, 454008
28
Permskoe PMES
34 Visherskaya Street, Perm, the Perm Region, Russia, 614058
238
FEDERAL GRID COMPANY
ANNUAL REPORT
2010
Information on Federal Grid Company's branches
29
Mid-Volga PMES
83 Federatsii Street, Ulyanovsk, Russia, 432071
30
Lower Volga PMES
40 Sokolovaya Gora, Saratov, Russia, 410038
31
Stavropolskoe PMES
The Industrial Zone for Food Facilities,
Zheleznovodsk, the Stavropol Region, 357400
32
Kuban PMES
5 Tramvainaya Street, Krasnodar, Russia, 350021
33
Rostovskoe PMES
54/1 Dnepropetrovskaya Street, the Pervomaisky District,
Rostov-on-Don, Russia, 344093
34
Bryanskoe PMES
The Vygonichy settlement, the Bryansk Region, Russia, 243360
35
Vyborgskoe PMES
The Perovo settlement, the Vyborg District,
the Leningrad Region, Russia, 188932
36
Novgorodskoe PMES
10 Velikaya Street, Veliky Novgorod, Russia, 173001
37
Karelskoe PMES
11 Veterinarny Lane, Petrozavodsk, the Republic
of Karelia, Russia, 185013
38
Bely Rast Specialized Production Base PMES
The 750-kV substation, the Bely Rast Production Facility, the
Dmitrovsky District, the Moscow Region, Russia, 141870
39
West Siberia PMES
14 Geologicheskaya Street, the Khanty-Mansiysk Autonomous
Region, the Tyumen Region, Russia, 628405
40
Leningradskoe PMES
1 Kurchatov Street, Saint Petersburg, Russia, 194223
41
Tomsk PMES
1 Energeticheskaya Street, Tomsk, Russia, 634062
42
Kaspiyskoe PMES
73a Dakhadaeva Street, Makhachkala, the Republic
of Dagestan, Russia, 367012
43
Auto-transport PMES of Urals
5 Tolmachova Street, Yekaterinburg, Russia, 620041 The 220kV
Syktyvkar substation, 1121st
44
North PMES
Promyshlennaya Street, the Chovsk Industrial Zone, Syktyvkar,
the Republic of Komi, Russia, 167000
45
Orenburgskoye PMES
15 Automatiky Passage, Orenburg,
the Orenburg Region, Russia, 460048
46
Sochinskoye PMES
93 Armavirskaya Street, the Dagomys settlement, the
Lazorevsky District, the Krasnodar Region, Russia, 354207
47
Samarskoye PMES
130 Zubchaninovskoye Shausse, Samara, Russia, 443109
48
Central PMES
The Administrative Building of the Engineering
Consolidation Base, Passage 1 PR, the Vostochny Industrial
Zone, Surgut, the Khanty-Mansi Autonomous District,
the Tyumen Region, Russia, 628400
49
Southern PMES
The 500kV Tyumen substation, the 5th kilometer
of the Velizhan Highway, the Central District,
the Tyumen Region, Russia, 625000
50
Eastern PMES
20 Industrialnaya Street, Panel 20, the Zapadny
Industrial Zone, Yugra Nizhnevartovsk,
the Khanty-Mansiysk Autonomous Region,
the Tyumen Region, Russia, 628600
51
Yamalo-Nenetskoye PMES
10 Entuziastov Street, Noyabrsk, the Yamalo-Nenets
Autonomous District, the Tyumen Region, Russia, 629806
239
SUBSIDIARIES
Details on Federal Grid Company's Participation in Subsidiary, Dependent and Other Companies
Ite
m
Abbreviated company name
1 S&T Elektroenergetika
2 Mobile GTES
100.00%
100.00%
10,594,255
2,018,405
-
3 Elektrosetservice UNEG
100.00%
100.00%
954
954
70
4 CIUS EES
100.00%
100.00%
833
833
93 562
2 432 282
113 635
956 588
5 ESSK UES
100.00%
100.00%
134
-
258 056
75 513
193 585
6
100,00%
100,00%
19 997
19 997
9 436
1 392 239
57 536
167 860
7 Verificatory Center of Electronic Digital
Signatures for Energy
100,00%
100,00%
55 071
55 071
-
3 808
-7 274
40 522
8 Index of Energy-FGC UES
100,00%
100,00%
0
0
-
42 553
8 602 275
-2 435 381
9 Chitatekhenergo
100,00%
100,00%
4 092
4 092
1 259
298 484
6 473
31 404
10 Energy Forecasting Agency (ABPE)
100,00%
100,00%
3 500
3 500
-
355 360
791
173 179
11 Glavsetservice UNEG
100,00%
100,00%
1 000
1 000
-
218 790
-198 404
-541 718
12 CSRI NPKenergo
100,00%
100,00%
1
1
- The decision on liquidation has been
made
13 Volgaenergosnabkomplekt
100,00%
100,00%
0
0
-
14 Nurenergo
77,00%
77,00%
0
0
-
2,122,500
-2
-4
15 MES Tomsk
52,025%
52,025%
866 424
866 424
-
114 307
-30 358
1 194 572
50% plus 1
share
50% plus 1
share
163
163
-
37 430
-9 082
310 049
17 GruzRosenergo IPS
50,00%
50,00%
763 227
763 227
-
254 076
23 251
7 130 284
18 MES Kuban
48,99%
48,99%
134 139
134 139
-
102 612
-67 929
391 284
MUS Energetika
16 GVC Energetiki
240
Federal Grid Company's
Book value of shares and
Financial performance in
Dividend
share in the charter capital interest in the Company, RUR amount, RUR
2010
of Company
thousand
thousand*
01.01.2010 01.01.2011
01.01.2010
01.01.2011
Revenue,
Net profit, Net assets,
100,00%
100.00%
3,895,820
100.00%
100.00% 3,895,820 3,895,820 1,187,357
1,806,807
-334
3,822,204 34
9,819,217
1,090,256
No business operations
FEDERAL GRID COMPANY
Type of business under the Charter
Purpose of participation
ANNUAL REPORT
2010
Information on modified interest in the Company
in 2010 or any concluded agreements to buy and
sell shares or interest
R&D
The purchase of Company's shares is approved by the
decision of the Board of Directors of Federal Grid
Company of 29 June, 2007 (Minutes No. 46)
Electric energy generation
Shares are received in accordance with the spin-off
balance sheet of RAO UES Russia in merging RAO
UES with Federal Grid Company during Companies'
reorganization on 1 July, 2008
Technical maintenance and repairs of
The Company's establishment was approved by the
electric grid facilities
decision of the Board of Directors of Federal Grid
Company of 13 November, 2007 (Minutes No. 50)
Operating as construction manager of
The Company's establishment was approved by the
capital construction projects, renovation
decision of the Board of Directors of Federal Grid
and technical re-equipment of electric
Company of 13 November, 2007 (Minutes No. 50)
grid facilities
Agency purchase operations
The shares were received under the spin-off balance
sheet RAO UES Russia in merging RAO UES with
Federal Grid Company during Companies'
reorganization on 1 July, 2008
Communication services
The controlling stake was transferred to Federal Grid
Company under the decision of the Board of Directors of
15 April, 2005 (Minutes No. 183 of 24 December, 2004).
The agreement to purchase and sell shares was
approved by the Board of Directors of Federal Grid
Company (Minutes No. 22 of 22 March, 2005)
Distribution of encryption
(cryptographic) tools (cryptographic
protection of information)
The shares were received under the spin-off balance
sheet RAO UES Russia in merging RAO UES with
Federal Grid Company during Companies'
reorganization on 1 July, 2008
Securities trading
The shares were received under the spin-off balance
sheet RAO UES Russia in merging RAO UES with
Federal Grid Company during Companies'
reorganization on 1 July, 2008
Communication services, UNEG
Reorganization of Chita Backbone Grids, the owner of
projects renovation, design and
100% of shares in the Company, by merger with
operation of communication lines
Federal Grid Company on 1 July, 2008
General system forecast and analysis
The shares were received under the spin-off balance
in electric power sector
sheet RAO UES Russia in merging RAO UES with
Federal Grid Company during Companies'
reorganization on 30 June, 2006
Maintenance and repairs of electric grid
The Company's establishment was approved by the
facilities
decision of the Board of Directors of Federal Grid
Company of 13 November, 2007 (Minutes No. 50)
Management company services
Reorganization of Chita Transmission Networks, the
owner of 100% of shares in the Company, by merger
with Federal Grid Company on 1 July, 2008
Supply of materials and equipment
Reorganization of Chita Transmission Networks, the
owner of 100% of shares in the Company, by merger
with Federal Grid Company on July 1, 2008
Transfer, distribution and sale of energy
The additional issue shares are received for the
repayment of loans granted to the Company earlier. The
decision of the Board of Directors of Federal Grid
Company of 20 May, 2004 (Minutes No. 15)
Services to transmit and distribute
Subject to the consolidation plan of UNEG -Energo
electric energy
facilities approved by the Board of Directors of RAO
UES Russia (Minutes No. 188 of 25 February, 2005),
shares of RAO UES Russia are deposited for payment
of the additional issue of Federal Grid Company
ordinary shares.
Leasing own real estate
The shares were received under the spin-off balance
sheet RAO UES Russia in merging RAO UES with
Federal Grid Company during Companies'
reorganization on 1 July, 2008
Power transmission services
The Company's shares acquisition was approved by the
decision of the Board of Directors of Federal Grid
Company of 29 June, 2007 (No. 46)
Electric power transmission and
Subject to the consolidation plan of UNEG Energo
distribution services
facilities approved by the Board of Directors of RAO
UES Russia (Minutes No. 188 of 25 February, 2005),
shares of RAO UES Russia are deposited for payment
of the additional issue of Federal Grid Company
ordinary shares.
241
ATTACHMENTS
Ite
m
Abbreviated company name
19 Energotechkomplekt
20 Severovostokenergo
49,00%
49,00%
21 Schekinskie PGU
45,21%
45,21%
0
0
22 WGC-1
40,17%
40,17%
13 164 371
21,851,019
- 56,466,806
23
24
25
26
IT Energy Service
ENIN
UEUK
Volga Territorial Generating Company
(TGC-7)
27 TGC-11
39,99%
38,24%
33,33%
32,14%
39,99%
38,24%
33,33%
29,99%
198 360
1 023
50
13 262 806
198 360
1 023
50
20,066,560
-
27,45%
27,45%
2 463 551
2,702,921
-
28 TGC-6
23,58%
23,58%
4 304 329
7,291,153
-
29 Bashkirenergo
21,27%
21,27%
7 143 138
15,456,189
232 446
30 Sangtudinskaya HPP-1
14,48%
14,48%
551 256
316
-
31 OGK-6
9,60%
9,60%
2 317 319
4 422 283
-
32 Energorynok
8,50%
8,50%
1
1
-
33 SOVASATOM
3,38%
3,38%
1
1
-
34 Mosenergo
3,37%
3,37%
4 419 858
4 311 255
15 625
35 Stand
0,83%
0,83%
3 000
3 000
-
36 Centerenergoholding
242
Dividend
Federal Grid Company's
Book value of shares and
Financial performance in
share in the charter capital interest in the Company, RUR amount, RUR
2010
thousand*
of Company
thousand
01.01.2010 01.01.2011
01.01.2010
01.01.2011
Revenue,
Net profit, Net assets,
49,00%
49,00%
101
101
3 517
25
440
9 800
9 800
-
0,0013%
0,0013%
6
6
-
37 OGK-4
-
0,0009%
-
1 736
-
38 OGK-2
-
0,0009%
-
514
-
39 RusHydro
-
0,0008%
-
3 859
-
40 TGC-1
-
0,0006%
-
470
-
41 Fortum
-
0,0006%
-
238
-
42 Kuzbassenergo
-
0,0006%
-
160
-
43 TGK-13
-
0,0006%
-
129
-
44 WGC-3
-
0,0005%
-
402
-
45 Quadra
-
0,0005%
-
147
-
46 TGC-2
-
0,0005%
-
63
-
47 TGK-9
-
0,0004%
-
186
-
48 TGK-14
-
0,0004%
-
22
-
49 Intergeneratsiya
-
0,0004%
-
6
-
No business operations
170 134
240 504
0
2,757,135 32,828,139
27 652
4 299
-49 441
223 507
93 934
115
FEDERAL GRID COMPANY
ANNUAL REPORT
2010
Type of business under the Charter
Purpose of participation
Agency services to companies and
organizations involved in the
construction and operation of Russia's
power facilities
Generation and sales of electric and
thermal energy
Services related to construction and
renovation of electric power facilities
Generation of electric and thermal
power
IT services
R&D
Energy companies management
Generation of electric and thermal
power
The shares were received under the spin-off balance
sheet RAO UES Russia in merging RAO UES with
Federal Grid Company during Companies'
reorganization on 1 July, 2008
"
Generation of electric and thermal
power
Generation on electric and thermal
power
Generation, transmission and sale of
electric and thermal power
Generation, transmission and sale of
electric and thermal power
Generation, transmission and sale of
electric and thermal power
Publishing and printing services
Construction and commissioning works
related to energy facilities
Generation, transmission and sale of
electric power
Information on modified interest in the Company
in 2010 or any concluded agreements to buy and
sell shares or interest
"
"
"
"
"
"
"
"
"
Subject to the Treaty between the Russian Federation
Government and Tajikistan Government on a joint
decision to issue shares of the Company dated 6
December, 2005
The shares were received under the spin-off balance
sheet RAO UES Russia in merging RAO UES with
Federal Grid Company during Companies'
reorganization on 1 July, 2008
Shares are purchased in accordance with the decision
of the Federal Grid Company Board of Directors of 28
December, 2004 (Minutes No. 20)
The shares were received under the spin-off balance
sheet RAO UES Russia in merging RAO UES with
Federal Grid Company during Companies'
reorganization on 1 July, 2008
The agreement for purchase and sale of 700 ordinary
registered uncertified shares of C SOVASATOM was
concluded by Federal Grid Company (Seller) and
AVAN (Buyer) to perform the decision of the Board of
Directors of Federal Grid Company (Minutes No. 121
of 29 December, 2010). The price of Agreement is
RUR21,000. The shares are transferred on 2
February, 2011 (Custody Transaction Report No.
001288-001 of February 2, 2011.)
The shares were received under the spin-off balance
sheet RAO UES Russia in merging RAO UES with
Federal Grid Company during Companies'
reorganization on 1 July, 2008
Installation and commissioning of GTE110 gas turbine engines and their
models and generation and sales of
electric energy
Property trust management and agency
operations
Generation of electric and thermal
power
Generation of electric and thermal
power
Generation of electric and thermal
power
Generation of electric and thermal
power
Generation of electric and thermal
power
Generation of electric and thermal
power
Generation of electric and thermal
power
Generation of electric and thermal
power
Generation of electric and thermal
power
Generation of electric and thermal
power
Generation of electric and thermal
power
Generation of electric and thermal
power
Asset management
243
ATTACHMENTS
Ite
m
Abbreviated company name
Federal Grid Company's
Book value of shares and
Dividend
Financial performance in
share in the charter capital interest in the Company, RUR amount, RUR
2010
of Company
thousand
thousand*
01.01.2010 01.01.2011
01.01.2010
01.01.2011
Revenue,
Net profit, Net assets,
1 share **
1 share **
0
0
1 1 131 317
72 495
212 198
50 Dalenergosetproyekt
51 Tsentr Energetiki
98,56%
-
97 423
-
-
52 SMUEK
50,00%
-
0
-
-
53 Trest SVES
6,14%
-
0
-
-
54 Natsenergo
1,90%
-
39
-
-
0,0014%
-
6
-
-
50 751 876
0
352 399
55 Sibenergoholding
Total:
* - received in 2010 following the 2009 results minus dividend tax
** - other shares are owned by S&T Elektroenergetika, a 100% subsidiary of Federal Grid Company
244
FEDERAL GRID COMPANY
Type of business under the Charter
Purpose of participation
Integrated design in energy sector
Company's shares purchase and sale agreement was
approved by the Board of Directors of Federal Grid
Company on 25 May, 2008 (Minutes No. 63)
The shares were received under the spin-off balance
sheet RAO UES Russia in merging RAO UES with
Federal Grid Company during Companies'
reorganization on 1 July, 2008
Technical and operational maintenance
of buildings, structures and premises
Energy companies management
Design and construction of industrial
and technical projects
The shares were received under the spin-off balance
sheet RAO UES Russia in merging RAO UES with
Federal Grid Company during Companies'
reorganization on 1 July, 2008
The shares were received under the spin-off balance
sheet RAO UES Russia in merging RAO UES with
Federal Grid Company during Companies'
reorganization on 1 July, 2008
ANNUAL REPORT
2010
Information on modified interest in the Company
in 2010 or any concluded agreements to buy and
sell shares or interest
The agreement to purchase and sell 5,628 ordinary
registered shares of Energy Industry Sector was
concluded by Federal Grid Company (Seller) and Oil
House (Buyer) to perform the decision of the Board of
Directors of Federal Grid Company. Price of
Agreement is RUR1,940,000. On 22 November,
2010, the shares were credited to Buyer's current
account (Custody Transaction Report No. 011363001 of November 22, 2010).)
Liquidated (Certificate of Entry into the Unified State
Register of Legal Entities of 15 February, 2010)
Liquidated (Certificate of Entry into the Unified State
Register of Legal Entities of 29 September, 2009)
Energy equipment supply
Liquidated (extract from the Unified State Register of
Legal Entities No. 4035412 of December 17, 2010)
Property trust management and agency
operations
Federal Grid Company and SUEK-Krasnoyarsk
have concluded the purchase and sale agreement on
300,000 ordinary shares and 300,000 preferred
shares of Sibenergoholding. Price of Agreement is
RUR45,409.01
245
ATTACHMENTS
2010 Interested Party and Major Transactions
Below is information on interested party transactions carried out by Federal Grid Company in
2010, which comply with Russian laws and require the approval of the Company’s authorized
management body:
1.
2.
3.
4.
An agreement to purchase movable property
concluded between Federal Grid Company and
Energy Forecasting Agency. The total value of
property in question stands at RUR495,348
(four hundred and ninety-five thousand three
hundred and forty-eight) and 65 kopecks, including VAT in the amount of RUR89,162 (eightynine thousand one hundred and sixty-two) and
76 kopecks (Minutes No. 95 as of 18.01.2010);
Additional agreement No. 5 to the agreement No. C/01 for performing functions of the
owner/developer, concluded on 01.04.2008
between Federal Grid Company and CIUS
UES. The value of the additional agreement
is RUR398,668,000 (three hundred and ninety-eight million, six hundred and sixty-eight
thousand), including Russian VAT (18%) in the
amount of RUR71,760,240 (seventy-one million,
seven hundred and sixty thousand two hundred
and forty) (Minutes No. 95 as of 18.01.2010);
Additional agreement No. 6 to the agreement No. C/01 for performing functions of the
owner/developer, concluded on 01.04.2008
between Federal Grid Company and CIUS
UES. The value of the additional agreement
is RUR1,695,350,000 (one billion, six hundred
and ninety-five million three hundred and fiſty
thousand), including Russian VAT (18%) in the
amount of RUR305,163,000 (three hundred
and fi ve million one hundred and sixty-three
thousand) (Minutes No. 95 as of 18.01.2010);
A service agreement for the safekeeping of
state secrets concluded between Federal Grid
Company and MOESK. The value of the Service agreement is RUR450,000 (four hundred
and fifty thousand), including Russian VAT
(18%) in the amount of RUR68,644 (sixty-
246
eight thousand, six hundred and forty-four) and
7 kopecks (Minutes No. 98 as of 10.03.2010);
5.
An agreement for the use of electrical grid
facilities concluded between Federal Grid
Company and MRSK North-West. The value
of the agreement is RUR4,071,130 (four million, seventy-one thousand one hundred and
thirty), including Russian VAT in the amount
of RUR732,803 (seven hundred and thirty-two
thousand eight hundred and three) and 40
kopecks (Minutes No. 98 as of 10.03.2010);
6.
An agreement for the repair and operation of the
500-kV outdoor switch-gear of the Iriklinskaya
HPP, a branch of WGC-1, concluded between
Federal Grid Company and WGC-1. The value
of the agreement is RUR9,675,530 (nine million, six hundred and seventy-five thousand five
hundred and thirty) and 36 kopecks, including
Russian VAT in the amount of RUR1,475,928
(one million, four hundred and seventy-five thousand nine hundred and twenty-eight) and 36
kopecks (Minutes No. 100 as of 28.04.2010);
7.
Additional agreement No. 5 to the agreement
No. 209 as of 01.03.2009 for servicing the dispatch and engineering control and the automated control equipment of UNEG facilities, concluded between Federal Grid Company and MUS
Energetiki (Minutes No. 100 as of 28.04.2010);
8.
An agreement on training services concluded
between Federal Grid Company and MRSK Ural.
The value of the agreement is RUR2,699,073
(two million, six hundred ninety-nine thousand
and seventythree) and 20 kopecks, including
Russian VAT (18%) in the amount of RUR411,723
(four hundred and eleven thousand, seven hundred and twenty-three) and 3 kopecks for 177
employees (Minutes No. 101 as of 12.05.2010).
The trust agreement concluded between Federal
Grid Company and INTER RAO UES (Minutes No.
103 as of 15.06.2010);
9.
Additional agreement No. 7 to the agreement No. C/01 for the performance of owner/
developer functions concluded on 01.04.2008
FEDERAL GRID COMPANY
between Federal Grid Company and CIUS
UES. The value of the Additional agreement
is RUR1,986,582,000 (one billion, nine hundred and eighty-six million, fi ve hundred and
eighty-two thousand), including Russian VAT
(18%) in the amount of RUR357,584,760 (three
hundred and fiſt y-seven million, fi ve hundred
and eighty-four thousand and seven hundred
and sixty) (Minutes No. 104 as of 16.06.2010);
10. An agreement for the performance of a special expert assessment concluded between Federal Grid
Company and SO UES. The price of the agreement
is RUR100,000 (one hundred thousand), including
Russian VAT (18%) in the amount of RUR15,254
(fiſteen thousand two hundred and fiſtyfour) and
24 kopecks (Minutes No. 107 as of 22.06.2010);
11. An agreement for the repair and maintenance of
power grid facilities concluded between Federal
Grid Company and MRSK Volga. The value of
the agreement is RUR12,937,000 (twelve million, nine hundred and thirty-seven thousand)
and 21 kopecks, including Russian VAT in the
amount of RUR1,973,440 (one million, nine hundred and seventy-three thousand four hundred
and forty) and 71 kopecks (Minutes No. 107 as
of 22.06.2010);
12. Additional agreement No1 to the General Contractor agreement No822 for the construction of communication facilities for the mobile
radio communication network, concluded on
21.01.2009 between Federal Grid Company and
MUS Energetiki. The value of the agreement is
RUR375,564,621 (three hundred and seventyfive million five hundred and sixty-four thousand
six hundred and twenty-one) and 21 kopecks,
including VAT (Minutes No. 107 as of 22.06.2010);
13. Additional agreement No. 2 to the Investment
agreement No. 771 as of 08.08.2008 for the
construction of line and cable installations for
the fiber-optic communications line along the
route which includes the 500-kV Zarya substation, the 500-kV Riga substation, the 500-kV
Novo-Anzherskaya substation and the 1,150-kV
Itatskaya substation. The agreement was con-
ANNUAL REPORT
2010
cluded between Federal Grid Company and MUS
Energetiki (Minutes No. 107 as of 22.06.2010);
14. An Agency agreement concluded between
Federal Grid Company and INTER RAO UES.
The value of the agreement is 2% of the price
of work or RUR61,650 (sixty-one thousand, six
hundred and fiſty) and 60 kopecks, including VAT
(18%) in the amount of RUR9,404 (nine thousand
four hundred and four) and 32 kopecks (Minutes
No. 107 as of 22.06.2010);
15. An agreement for the performance of tests of
transformer fluid for substation equipment operated by the PMES Caspian, concluded between
Federal Grid Company and MRSK North Caucasus. The value of the agreement is RUR413,847
(four hundred and thirteen thousand, eight hundred and fortyseven) and 48 kopecks, including
Russian VAT (Minutes No. 111 as of 09.08.2010);
16. An Agency agreement concluded between
Federal Grid Company and the Index of Energy
Federal Grid Company. Compensation for the
Agent is RUR42,000 (forty-two thousand), including Russian VAT in the amount of RUR7,560
(seven thousand five hundred and sixty). Apart
from compensation, the Principal shall reimburse
the Agent for the cost of work performed. Total
costs borne by the Agent are RUR6,051,000 (six
million and fiſty-one thousand) rubles, including
Russian VAT in an amount of up to RUR923,034
(nine hundred and twenty-three thousand and
thirty-four) (Minutes No. 114 as of 14.09.2010);
17. An assessment agreement concluded between
Federal Grid Company, INTER RAO UES and
RusHydro, on the one hand, and The Institute for
Problems of Enterprise Ltd, Deloitte and Touché
CIS and Nexia Pacholi Consulting, co-contractors
(the Consortium), on the other hand. The price of
services is distributed among co-customers as
follows: Customer 1 (INTER RAO UES) – up to
RUR29,618,000 (twenty-nine million, six hundred
and eighteen thousand), including Russian VAT
(18%), Customer 2 (Federal Grid Company) – up
to RUR29,618,000 (twenty-nine million, six hundred and eighteen thousand), including Russian
247
ATTACHMENTS
VAT (18%) and Customer 3 (RusHydro) – up to
RUR29,618,000 (twenty-nine million, six hundred and eighteen thousand), including Russian
VAT (18%) (Minutes No. 114 as of 14.09.2010);
18. An agreement on the termination of agreement
No. U/2007-69 concluded between Federal Grid
Company and INTER RAO UES on 27.08.2007.
The value of the agreement is RUR82,600
(eightytwo thousand and six hundred) per
month, including Russian VAT (18%) in the
amount of RUR12,600 (twelve thousand and six
hundred) (Minutes No. 114 as of 14.09.2010);
19. An agreement for the services of the listing
agent’s investment bank concluded between
Federal Grid Company and VTB Capital. The
value of the agreement (remuneration due to
the bank) is RUR7,788,000.00 (seven million,
seven hundred and eighty-eight thousand)
rubles, including the bank’s overhead costs,
and VAT (Minutes No. 120 as of 16.12.2010);
20. An agreement with the members of the Board
of Directors. The value of the agreement
is determined by the General Shareholders
Meeting (Minutes No. 120 as of 16.12.2010);
21. An agreement concluded between Federal Grid
Company and SO UES with the purpose of restructuring liabilities of SO UES. The value of the
agreement is RUR1,113,718,755 (one billion, one
hundred and thirteen million, seven hundred and
eighteen thousand, seven hundred and fiſty-five)
and 64 kopecks (Minutes No. 121 as of 29.12.2010);
22. Service agreement for the development and
continuous updating of the tariff and balance
model of the electrical energy industry for the
purpose of developing the 2010 sliding forecast
and the mediumterm forecast for the 2011-2013
period, and suggestions on tariffs for products
and services in the electrical energy industry. The
agreement is concluded between Federal Grid
Company and APBE. The value of the agreement
is RUR11,800,000 (eleven million, eight hundred
thousand) (Minutes No. 121 as of 29.12.2010);
248
23. Service agreement for the periodic provision of
forecast data on electric power consumption in
Russian Federation subjects in the medium-term
(seven years) and long-term (fiſteen years) for the
purpose of the development and adjustment of the
UNEG Development Scheme. The agreement was
concluded by Federal Grid Company and APBE.
The value of the agreement is RUR28,674,000
(twenty-eight million six hundred and seventyfour thousand) (Minutes No. 121 as of 29.12.2010);
24. Service agreement for the periodic acquisition,
processing and analysis of reporting information
on the condition and functioning of the UNEG,
supplied by electric energy companies. The agreement is concluded between Federal Grid Company and APBE. The value of the agreement is
RUR17,700,000 (seventeen million, seven hundred
thousand) (Minutes No. 121 as of 29.12.2010);
25. Service agreement on the performance of a special assessment, concluded between Federal Grid
Company and INTER RAO UES. The value of the
agreement is RUR50,000 (fiſty thousand), including VAT (18%) in the amount of RUR7,627 (seven
thousand, six hundred and twenty-seven) and
12 kopecks (Minutes No. 121 as of 29.12.2010);
26. Service agreement on the formation of guidelines for the development, agreement and
monitoring of Investment Program implementation. The agreement is concluded between
Federal Grid Company and APBE. The value
of the agreement is RUR28,320,000 (twentyeight million, three hundred and twenty thousand) (Minutes No. 121 as of 29.12.2010);
27. Service agreement for the development of
the system of monitoring and forecasting
volumes, prices and production costs, and
electrical energy distribution. The agreement
is concluded between Federal Grid Company
and APBE. The value of the agreement is
RUR8,850,000 (eight million, eight hundred and
fiſty thousand) (Minutes No. 121 as of 29.12.2010);
FEDERAL GRID COMPANY
28. Service agreement for the development
of information and analytical materials
on the functioning and development of
Russia’s electrical energy industry based on
2009 data (express report) and 2010 data
(monthly and quar terly repor ts). The
agreement is concluded between Federal
Grid Company and APBE. The value of the
agreement is RUR17,700,000 (seventeen
million, seven hundred and seventy thousand) (Minutes No. 121 as of 29.12.2010);
ANNUAL REPORT
2010
During 2010, the Company carried out no
transactions (related party transactions), the value
of which stands at 5% or more of the book value
of the Company’s assets, as determined by
the Company’s financial statements as dated on
the last reporting date before the transaction is
performed.
During 2010, the Company and its dependent
companies carried out no transactions with
shareholders who owned at least 5% of the
voting shares.
29. Service agreement on drawing the forecast balance of the electrical energy industry
for the period from 2020 till 2030 (monitoring the general layout of electrical energy
facilities). The agreement was concluded between Federal Grid Company and APBE. The
value of the agreement is RUR18,880,000
(eighteen million, eight hundred and eightythousand) (Minutes No. 121 as of 29.12.2010);
30. Agreement No. 1 on the reimbursement of
the cost of permanent improvements per
Property Lease agreement No. SSH-3492009 concluded between Federal Grid Company and RusHydro on 09.10.2009. The value of
the agreement is RUR18,186,255 (eighteen
million, one hundred and eighty-six thousand,
two hundred and fi ſt y-fi ve) and 33 kopecks,
including VAT (18%) in the amount of
RUR3,273,525 (thee million, two hundred and
seventy-three thousand, five hundred and twentyfive) and 97 kopecks (Minutes No. 121 as of
29.12.2010).
249
ATTACHMENTS
IMPLEMENTATION OF THE ASSIGNMENTS
OF THE PRESIDENT AND GOVERNMENT
OF THE RUSSIAN FEDERATION
Registration Details Assignment
Issued By
Assignment Summary
Performance Status
Performance Date
5-732
as of 26 January,
2010
Igor Sechin,
Russian Government
Joint project with Power
Machines and Federal Grid
Company to manufacture
high voltage electric power
installations
Performed.
8 February, 2010
Andrey Kazachenkov and Andrey
Sveshnikov were responsible for
maintaining cooperation with
Power Machines. Necessary
materials have been prepared.
The meeting with Power
Machines representatives
was held on 8 February, 2010.
Reply letter No. TD-549 as of 4
February, 2010 was forwarded to
Andrey Shishkin, Russian Deputy
Minister of Energy
5-1474
as of 12 February,
2010
Igor Shuvalov,
Russian Government
Engineering utilities connection
to the cement production line
under construction at the
Verkhneabakansky Cement
Plant (Elena Baturina)
Performed.
Reply letter No. BR-1155 as of
5 March, 2010 is forwarded to
Andrey Shishkin, Russian Deputy
Minister of Energy
4 March, 2010
5-1748
as of 18 February,
2010
Igor Sechin,
Russian Government
Providing information on
the implementation of
investment programs by
companies operating in the
Russian Federation (including
government-sponsored
enterprises) and their plans to
commission production facilities
in 2009-2010
Performed. Reply letter No.
TD-950 as of 26 February, 2010
is forwarded to Andrey Shishkin,
Russian Deputy Minister of
Energy
10 March, 2010
5-1751
as of 18 February,
2010
Dmitry Kozak,
Russian Government
Selecting sites to locate the
Veseloye and Vremennaya
(Reserve) substations (Oleg
Budargin)
Performed. The meeting to
4 March, 2010
addresubstation the location of
the Veseloye substation was held
in Sochi on 4 March, 2010. The
meeting with the Krasnodarsky
Regional Administration was held
11 March, 2010
5-1884
as of 24 February,
2010
Igor Sechin,
Russian Government
Coordinating the design and
construction of industrial and
social infrastructure facilities
under the project to develop
the Gremyachinsky potash salt
deposit
Performed. Reply letter No.
RP-1492 as of 18 March, 2010
is forwarded to Andrey Shishkin,
Russian Deputy Minister of
Energy
24 March, 2010
5-4006
as of 12 April,
2010
Vladimir Putin,
Russian Government
Instruction by Russian Prime
Minister Vladimir Putin following
the the State Atomic Energy
Corporation ROSATOM report
on nuclear power industry
performance in 2009 and NPP
construction using Russian
technologies in Russia and
abroad
Performed. Reply letter No.
BR-2233 as of 16 April, 2010 is
forwarded to Andrey Shishkin,
Russian Deputy Minister of
Energy
27 April, 2010
250
FEDERAL GRID COMPANY
ANNUAL REPORT
2010
Registration Details Assignment
Issued By
Assignment Summary
Performance Status
Performance Date
5-4255
as of 16 April,
2010
Vladimir Putin,
Russian Government
Giving the list of Mandates
of RF President No. Pr-839
as of 29 March, 2010,
following the meeting of the
Presidential Commission
for the Modernization and
Technical Development of the
Russian Economy, as of March
23rd, 2010
Performed. The following reply
letters are forwarded to the
Ministry of Energy: No. DG6856 as of 21 October, 2010;
No. ON-3273 as of 8 June,
2010; No. AL-4469 as of 28 July,
2010; No. BR-4895 as of 11
August, 2010; No. RP-6012 as
of 21 September, 2010; and No.
DG-6075 as of 23 September,
2010. All items of the Minutes
referring to the competency of
FGC have been performed
29 April, 2010
5-5362
as of 17 May, 2010
Igor Shuvalov, Russian Submitting materials on the
Government
dividend policy and proposals
on upgrading the financial
and economic performance
of Federal Grid Company
for review at the Russian
Government meeting
Performed. Reply letter No.
TD-3076 as of 28 May, 2010 is
forwarded to Maria Tikhonova,
Russian Ministry of Energy
28 May, 2010
5-8947
as of 13 August,
2010
Igor Sechin,
Russian Government
Making a decision on
replacing the registrar of
state-sponsored enterprises
whose shares are pledged
with state-owned credit
organizations
Performed. Reply letter No.
TD-5180 as of 19 August,
2010 is forwarded to Stanislav
Svetlitsky, Russian Ministry of
Energy
20 August, 2010
5-9112
as of 18 August,
2010
Igor Sechin,
Russian Government
Submitting draſt legal
regulations on anti-terrorism
security at fuel and energy
sector facilities
Performed. Reply letter No.
MU-5191 as of 19 August, 2010
to Andrey Shishkin, Russian
Deputy Minister of Energy
19 August, 2010
5-9470
as of 27 August,
2010
Igor Sechin,
Russian Government
Follow-up revisions of legal
regulations and submitting
the final approved version
prior to 20 September, 2010
Performed. Reply letter No.
MU-5869 as of 15 September,
2010 is forwarded to Andrey
Shishkin, Russian Deputy
Minister of Energy
15 September, 2010
5-9521
as of 30 August,
2010
Igor Shuvalov,
Russian Government
Carrying out agreements
reached at the 14th Meeting
of the Russian-Mongolian
Inter-governmental
Commission for Trade,
Economic, Scientific and
Technical Cooperation held
20 July, 2010 in Ulan-Bator
(Mongolia)
Performed. Reply letter No.
126/242 as of 13 September,
2010 is forwarded to Mikhail
Pleshkin at the Russian Ministry
of Energy
13 September, 2010
5-9715
as of 2 September,
2010
Vladimir Ampilogov,
Industry and
Infrastructure
Department of the
Russian Government
Including efforts to develop
electric grids for power supply
to new production lines for
the Unified Metallurgical
Company in Federal Grid
Company's investment
program
Performed. Reply letter No.
BA-6326 as of 1 October,
2010 is forwarded to Vladimir
Ampilogov, Director of the
Industry and Infrastructure
Department of the Russian
Government
30 September, 2010
5-10423
as of 21 September,
2010
Igor Sechin,
Russian Government
Addressing the issue of giving
pre-qualification assistance
to GlobalElectroService for
the tender and providing
information to the Russian
Government
Performed, Reply letter No.
BA-6211 as of 28 September,
2010 is forwarded to Andrey
Shishkin, Russian Deputy
Minister of Energy
24 September, 2010
5-10608
as of 24 September,
2010
Dmitry Kozak,
Russian Government
Carrying out the Russian
Federation Government
Mandate No. DK-P9-4292 as
of 25 June, 2010
Performed. Reply letter No. DG6390 as of 5 October, 2010 is
forwarded to Andrey Shishkin,
Russian Deputy Minister of
Energy
4 October, 2010
251
ATTACHMENTS
Registration Details Assignment
Issued By
Assignment Summary
Performance Status
Performance Date
3-11613
as of 19 October,
2010
Valentin Letunovsky,
Control Directorate in
the Administration of
the President of the
Russian Federation
Providing information on the
development and approval
of innovative development
programs for governmentsponsored enterprises
Performed. Reply letter No.
BO-7698 as of 19 November,
2010 is forwarded to Valentin
Letunovsky, Deputy Chief of
the Control Directorate in the
Administration of the President
of the Russian Federation
15 November, 2010
5-11616
as of 19 October,
2010
Igor Shuvalov,
Russian Government
Submitting the List of
Instructions given by Igor
Shuvalov, First Deputy Prime
Minister of Russia, during his
business trip to Vladivostok on
8 October, 2010
Performed. Letter No. BO6872 as of 21 October, 2010
is forwarded to Sergei Darkin,
Primorsky Krai Governor ; and
reply letter No. BA-7263 as of
3 November, 2010 to Andrey
Shishkin, Russian Deputy
Minister of Energy
16 November, 2010
5-11845
as of 22 October,
2010
Igor Shuvalov,
Russian Government
Improving the efficiency of
electric and heat power
engineering management
and implementation of pilot
projects to raise investments
in the infrastructure sector
Performed. Federal Grid
Company issued Order No. 856
as of 8 November, 2010; and
forwarded reply letter No. TD7514 as of 12 November, 2010
to Stanislav Voskresensky,
Russian Deputy Minister
of Economic Development;
letter No. TD-7515 to Elena
Pomchalova, Deputy Head
of the Federal Tariff Service;
letter No. TD-7516 to Andrey
Shishkin, Russian Deputy
Minister of Energy; and
letter No. TD-569 as of 31
January, 2011 to Stanislav
Voskresensky, Russian
Deputy Minister of Economic
Development
28 October, 2010
5-12490
as of 8 November,
2010
Igor Shuvalov,
Russian Government
Results of the 10th Meeting
of the Russian-Korean Joint
Commission for Economic,
Scientific and Technical
Cooperation
Pending. Quarterly reports
are submitted to the
Russian Ministry of Regional
Development, letter No. BR-36
as of 12 January, 2011
12 April, 2011
5-14385
as of 14 December,
2010
Igor Shuvalov,
Russian Government
Submitting for revision the
draſt Order of the Russian
Government on approving
the rules of agreement on
transferring power grid
facilities included in the Unified
National Electric Grid (UNEG)
for lease
Performed. Reply letter No.
TD-8756 as of 22 December,
2010 is forwarded to Andrey
Shishkin, Russian Deputy
Minister of Energy
17 December, 2010
5-14872
as of 23 December,
2010
Igor Sechin,
Russian Government
Submitting report on
investment program
performance
Performed. Reply letter No.
SS-8960 as of 29 December,
2010 is forwarded to Andrey
Shishkin, Russian Deputy
Minister of Energy
17 December, 2010
252
FEDERAL GRID COMPANY
ANNUAL REPORT
2010
AUDIT COMMISSION CONCLUSIONS ON THE VERACITY
OF INFORMATION IN THE ANNUAL REPORT
Audit Commission Conclusions
on the Veracity of Information in the Annual Report
Federal Grid Company Audit Commission's Repo
Moscow
11 May, 2011
In compliance with Federal Law No.208-FZ (dated 24 November, 2011) entitled
"On Joint Stock Companies," the Articles of Association of Federal Grid Company, and
the Plan of Work for the Audit Commission of Federal Grid Company (Minutes of Meeting No.1 dated 20 October, 2010 and Minutes of Meeting No.2 dated 27 December,
2010), an audit has been conducted of the 2010 annual reporting by the Company.
Based on this audit, and taking into account the findings of the audit of Federal
Grid Company’s financial (bookkeeping) accounts by PricewaterhouseCoopers Audit
(unnumbered, dated 23 March, 2011) for 2010, the following conclusions were reached:
Based on selective checks of documents submitted to the Audit Commission, the
information contained in the Federal Grid Company's Annual Report and annual
financial accounts for 2010 can be considered accurate in every significant
respect;
No evidence has been found of any violations of accounting procedures or financial reporting regulations, as stipulated by Russian laws.
The Annual Report of Federal Grid Company, submitted for approval to the
Annual General Shareholders Meeting, contains information specified in Paragraph 3.6
of the Provision on Additional Requirements on the procedure for preparing, convening
and holding the Annual General Shareholders Meeting, as approved by Resolution
No.17/ps (as of 31 May, 2002) of the Russian Federal Comission for the Securities
Market (FCSM) updated in FCSM Resolution No.03-6 p/s (as of 7 February, 2003).
Considering the above, the Audit Commission of Federal Grid Company has sufficient grounds to confirm the veracity, in every significant respect, of data contained in
the Annual Report of Federal Grid Company and the Company's 2010 annual significant
accounts.
Chariman of the Audit Commission of Federal Grid Company
V. Raspopov
Secretary of the Audit Commission of Federal Grid Company
A. Drokova
Members of the Audit Commission
A. Colyada
D. Gorevoy
253
ATTACHMENTS
2011 INVESTOR CALENDAR
Dates are subject to change
Date
Event
January 13-14
6th CIB Global Utilities Conference Societe Generale (Paris)
February 2-4
Forum Russia 2011, Troika Dialog (Moscow)
March 28
Listing on the London Stock Exchange
March 29
Extraordinary General Meeting
March 31
2010 Annual Results (RAS)
April 11-14
Morgan Stanley EMEA Conference (London, New York)
May 3
2010 Annual Financial Report (IFRS)
May 11
Capital Markets Day
May 12
Interim Report IQ 2011 (RAS)
May 16
Record Date (AGM)
June 29
Annual General Shareholders Meeting
August
Interim Report 2Q 2011 (RAS)
November
Interim report 3Q 2011 (RAS)
254
FEDERAL GRID COMPANY
ANNUAL REPORT
2010
GLOSSARY
Different names for Federal Grid Company and its branches
Federal Grid Company
Событие
Open Joint Stock Company “Federal Grid Company of the Unified Energy
System” (Federal Grid Company)
The Company
Federal Grid Company
Branches
The branches of Federal Grid Company – Backbone Electric Grid (MES),
Enterprise of Backbone Electric Grid (PMES)
Executive body (EB)
The executive body of Federal Grid Company
Abbreviations
Abbreviation
Full name
ACB
Air Circuit Breaker
ACPP
Annual Comprehensive Procurement Program
AGM
Annual General Shareholders Meeting
AIMS CMEE
Automated Information and Measurement System for the Commercial Metering of Electrical Energy
AMIS EPFA
Automated Measuring and Information System for Electric Energy Fiscal Accounting
AMS
Automated Management System
ASTPM
Automated System of Technological Process Management
AT
Automatic Transformer
ATMS
Automated Technological Management System
CCS
Carrier Communication System
CEO
Chief Executive Officer
CIM
Center for Information Management
COGS
Cost of Goods Sold
CSR
Controlled Shunt Reactor
CSR
Corporate Social Responsibility
CSTB
Coordinative Scientific and Technical Board
CT
Current Transformers
CTC
Central Tender Committee
DR
Depository Receipt
EBIT
Earnings Before Interest and Taxes
EBITDA
Earnings Before Interest, Taxes, Depreciation and Amortization
ECA
Emergency Control Automatics
ERPS
Enterprise Resource Planning System
ESPO
Eastern Siberia-Pacific Ocean Pipeline
ETS
Electronic Trading Site
FACTS
Flexible Alternate Current Transmission Systems
FAS
The Federal Antimonopoly Service
FFMS
The Federal Financial Markets Service
255
ATTACHMENTS
Abbreviation
Full name
FTS
The Federal Tariff Service
GCC
Grid Control Center
GDR
Global Depository Receipt
GESS
Grid Energy Storage Systems
GIDS
Gas-Insulated Distributor System
GIS
Gas-Insulated Switchgear
GPP
Gas Processing Plant
GRES
State District Power Plant
H&SP
Hardware and Soſt ware Package
HPP
Hydro Power Plant
HR
Human Resources
IA
Intangible Assets
IEM
Information Exchange Model
IES
Interconnected Energy System
IETL
Inter-State Electricity Transmission Line
IP
Internet Protocol
KPI
Key Performance Indicator
KPI
Key Performance Indicator
LNPP
Leningrad Nuclear Power Plant
LSE
London Stock Exchange
MCIA
Multi-Chamber Insulator Arrester
MICEX
Moscow Interbank Currency Exchange
MMSK
Inter-Regional Backbone Grid Company
NPP
Nuclear Power Plant
NVNPP
Novovoronezhskaya NPP
OECD
Organization for Economic Co-operation and Development
OS
Outdoor Switchgear
OTL
Overhead Transmission Line
PPE
Property, Plant and Equipment
PROI
Program for Reliability and Observability Improvement
R&D
Research and Development
RAB
Regulatory Asset Base
RAS
Russian Academy of Sciences
RAS
Russian Accounting Standards
RPA
Relay Protection and Automatics
RRL
Radio Relay Links
RTS
Russian Trading System
RUIE
Russian Union of Industrialists and Entrepreneurs
RUR
Russian rubles
S&P
Standard & Poor's
256
FEDERAL GRID COMPANY
Abbreviation
Full name
SC
Synchronous Compensator
SDCs
Subsidiaries and Dependent Companies
SDH
Synchronous Digital Hierarchy
SES AAG
Smart Energy System with Active Adaptive Grid
STSCS
Small Terrestrial Satellite Communication Station
SVC
Static VAR Compensator
TCSC
Thyristor Controlled Series Capacitor
TDM
Time Division Multiplexing
TM
Tests and Measurements
TPP
Thermal Power Plant
UEPTN
The Unified Electrical Power Technological Network
UES
Unified Energy System
UES of Russia
Unified Electrical System of Russia
UNEG
Unified National (All-Russian) Electrical Grid
VT
Voltage-Measuring Transformer
WDM
Wavelength-Division Multiplexing
WECM
Wholesale Electricity and Capacity Market
ANNUAL REPORT
2010
257
ATTACHMENTS
CONTACTS
Information on the Auditor(s)
Closed Joint Stock Company PricewaterhouseCoopers
Audit (PwC Audit)
Information on the Depository
National Settlement Depository non-banking credit
organization (NSD)
Location: 10 Butyrsky Val Street,
Moscow, Russia, 125407
INN: 7705051192
OGRN: 1027700148431
Telephone: +7 (495) 967-6000
Fax: +7 (495) 967-6001
E-mail: hotline@ru.pwc.com
Location: 1/13, bld 4 Sredny Kislovsky Lane,
Moscow, Russia
License number: Е000376
Date of issue: 20.05.2007
Expiration date: 20.05.2012
Issuing authority: Russian Ministry of Finance
Information on the auditor’s membership in selfregulated organizations:
Organization’s full name: Not-for-Profit Partnership
Audit Chamber of Russia
Location; Building 9, Block 2 3rd
Syromyatnichesky Lane, Moscow, Russia, 105120
Information on the Registrar
Closed Joint Stock Company STATUS Registrar
Company (STATUS)
Location: 32, Block 1 Novorogozhskaya Street,
Moscow, Russia, 109544
Postal address: 32, Block 1 Novorogozhskaya Street,
Moscow, Russia, 109544
Telephone: +7 (495) 974-8350
Fax: +7 (495) 678-7110
E-mail: info@rostatus.ru.
License number: 10-000-1-00304
Date of issue: 12.03.2004
License term: indefinite
Issuing authority: Russian Federal Financial Markets
Service
258
License number: 177-12042-000100
Date of issue: 19.02.2009
Expiration date: unlimited
Issuing authority: Russian Federal Financial Markets
Service
Information on the Custodian
Limited Liability Company Deutsche Bank
Location: 2 bld.82, Sadovnicheskaya Street, Moscow,
Russia, 115035
Telephone : +7 (495) 797-52-09
Fax: +7 (495) 797-50-99
General License number: 3328
Date of issue: 9.10.2003
FEDERAL GRID COMPANY
ANNUAL REPORT
2010
WE INVITE YOU TO ENTER INTO A DIALOG WITH US
Federal Grid Company
of Unified Energy System
Actual and postal address: 5A Akademika Chelomeya
Street, Moscow, Russia, 117630
Telephone: +7 (495) 710-9000
Fax: +7 (495) 710-9655
E-mail: info@fsk-ees.ru
Internet address: http://fsk-ees.ru/
Contact information for institutional investors
and analysts:
Shareholders, Investors and Liquidity Support
Investor Relations Department
Telephone: +7 (495) 710-9064
e-mail: ir@fsk-ees.ru
Telephone line for shareholders:
+7-800-200-1881
259