Translated material
Energy Doctor
Vladimir Putin reminded business of responsibility
During yesterday's visit to Khakassia, Vladimir Putin inspected the Sayano-Shushenskaya hydroelectric power station. The head of government said that the repair of the station is being carried out in full accordance with the schedule, adding that RusHydro will receive 10 billion rubles this year. for restoration work and 3.5 billion rubles. - for the completion of the spillway. However, other power engineers failed to earn high praise from the prime minister. Mr. Putin accused several private generating companies of failing to meet energy construction deadlines and misusing funds received from the state. The Prime Minister promised to apply “penalties” to those who “eat up” the money intended for investment and attract the attention of the prosecutor’s office.Having examined the SSHHPP, which was damaged during the August accident, from a helicopter flight height and switched on the sixth hydraulic unit (it has been idling since December) from the central control panel to industrial load, the head of the Cabinet seemed to be satisfied with the hydropower industry. “Today I want to state: all these tasks (to eliminate the consequences of the disaster and repair the station - Ed. ) have been solved. We have dealt with all this,” the prime minister said, noting that the station will be completely restored by the end of 2014 (in total it is planned to spend about 37 billion rubles on this). RusHydro notes that three more units are planned to be commissioned by the end of this year. Other projects implemented by RusHydro, in particular the Boguchanskaya HPP, according to Vladimir Putin, will also be completed on time. However, after the ceremonial launch, there seemed to be practically no positive moments left, and at a meeting on the electric power industry investment program, the prime minister harshly criticized the management of individual generating companies.
Thus, according to the prime minister, having received government funds during the reform of RAO UES, the companies assumed investment obligations. However, out of 450 billion rubles raised through an additional issue, only 270 billion went directly to the implementation of investment projects. Another 100 billion has still not been used and lies in accounts, and 66 billion went to the current activities of companies, including the purchase of various types of non-core assets. “The money was eaten away or, frankly speaking, was used for speculative purposes,” the head of government complained. In support, the prime minister cited statistics on the construction of power units, according to which, as part of investment agreements, almost 100 power units should be built today, but only 38 of them are undergoing full-fledged construction, and at another 14 facilities preparatory work has just begun. “At the remaining 45 sites, the horse was not lying down,” Putin noted. Moreover, according to him, company management prefers to search for excuses to evade their obligations. “We counted on the responsible position of the owners. But they refer to the crisis and lack of demand, and ask to delay the commissioning of generating capacities by another four to five years. And when they are offered to build a station where there is guaranteed demand, where additional energy facilities are especially important to the state, say, for example, in Sochi, they simply go into the bushes,” said the head of the cabinet.
Putin gave a whole list of such investors. Among them were OGK-4, OGK-3 , OGK-2, TGK-2, TGK-4, TGK-5, TGK-6, TGK-9, TGK-11, TGK-12, TGK-13. However, the head of the government specifically focused on generating companies controlled by well-known Russian businessmen - TGK-3, the main shareholder of which is Vladimir Potanin, TGK-2, owned by Mr. Lebedev's Sintez company, as well as TGK-4, owner of Onexim, Mikhail Prokhorov and “Integrated Energy System” by Viktor Vekselberg.
“We’ve known everyone for many years, we basically work together. In difficult crisis conditions, we have done everything to support you in various areas of your business. The crisis is passing. We met halfway and moved up the investment deadlines. There will be no more shifts. I ask you to pay close attention to the fulfillment of your obligations,” said Vladimir Putin. He added that TGC-4 still does not even have construction plans for some facilities. At the same time, the main shareholder does not have any particular difficulties with finances: “I’m upset. He has money. He goes to different offices and came to see me recently. I have a very good relationship with him. Looks for various uses for these funds and resources. And the obligations assumed earlier must be fulfilled!” - said the prime minister. He also complained about the owner of OGK-3, Vladimir Potanin, who acquired the generating company for 81.7 billion rubles, and then received 81.7 billion through an additional issue. “Essentially, he took a huge property for free. Okay, I took a huge property for free, but there are obligations to fulfill the investment program! Nothing is being done,” Putin added.
As examples of insolvent investors, the head of government cited state-owned Gazprom, Inter RAO, Russian Railways, as well as private LUKOIL and foreign companies: Finnish Fortum, Italian Enel and German E.ON. The latter, according to the prime minister, is implementing its 95 billion investment program, despite the fact that it received only 48 billion rubles from the additional issue. Summing up the investment meeting, he warned that the state will take tough measures against those companies that do not fulfill their energy construction obligations. “I want to say right away so that there are no offenses: those who “eat up” the resources intended for investment, especially take them outside, penalties will be applied to such colleagues. The state has all the necessary legal grounds for this. This includes the capabilities of the Prosecutor General’s Office,” the prime minister warned.
However, in Khakassia, Vladimir Putin not only threatened with a stick, but also offered a carrot. The Prime Minister announced that he had signed a decree defining the principles of operation of the long-term electricity market. “On the one hand, words such as sanctions and prosecutors are heard, on the other hand, a long-term capacity market is being introduced. And although in order for it to start working, it is still necessary to make changes to a number of documents, in particular to the law on the electric power industry, such steps make investments more attractive,” explained Renaissance Capital analyst Vladimir Sklyar. Director of the Energy Development Fund Sergei Pikin agrees with him, according to whom, today companies have no real barriers to implementing even capital-intensive projects. “Previously, when companies that did not want to invest in energy, there were two arguments: there is no demand for kilowatts and there are no economic incentives. But now both of them are irrelevant,” the expert noted, explaining that electricity consumption has returned to pre-crisis levels, and the state continues to follow the path of liberalizing the energy market, although it could switch to price regulation to support industry.
According to experts, the state came to its senses in a timely manner and funds used for other purposes can be returned. “The Accounts Chamber became concerned with the issue of misuse of funds by energy companies a year ago. And now some of the transactions have already been canceled and the money is being returned. 66 billion is not that much. In any case, these investors, many of whom are on the Forbes list, also have some of their own funds,” Mr. Pikin noted. At the same time, as his colleague from Renaissance Capital noted, if construction projects, postponed by investors for 3-5 years, are not resumed in the near future, a serious shortage of electricity may arise in the foreseeable future.
Fast and without guarantees
Some domestic energy companies will still receive additional injections from the state. So, according to Vladimir Putin, this year 53 billion rubles. will be allocated to Rosatom. Let us make a reservation that the amount provided for the construction of the nuclear power plant turned out to be 3 billion more than what the head of the state corporation Sergei Kiriyenko approached the government for in April 2009. Part of these funds, in particular, can be used for the construction of the Baltic nuclear power plant (with a capacity of 1,150 MW) in the Nemansky district of the Kaliningrad region. The prime minister announced the signing of the corresponding order yesterday, noting that private investors, including foreign ones, will also be able to participate in the project. Let us recall that the estimated cost of constructing a nuclear power plant, the first power unit of which should be built before 2016, and the second in 2018, is more than 194 billion rubles. Money may also be needed for Rosatom’s numerous foreign projects. For example, the other day it became known that Bulgaria could receive about 2 billion euros from Russian partners for the construction of a nuclear power plant in Belene. “As much as you need. Very quickly and without guarantees from the Bulgarian government,” Sergei Kiriyenko said during a meeting with Bulgarian Minister of Economy and Energy Traicho Traikov. Let us recall that by 2030 Rosatom plans to commission 40 new nuclear power units. Estimated costs are estimated at 60-70 billion dollars.