Inter RAO Group announced operating results for the full year 2016.

The following structural changes in Inter RAO Group took place in 2016 and affected its operating results:

  • The sale of 100% ownership stake in Georgian Mtkvari Energy in the second quarter of 2016
  • The acquisition of LLC Bashkir Energy Sales Company in December 2016
  • The results of CJSC Electric Networks of Armenia and OJSC Razdan TPP are not included in the 2016 results of the Group due to their phased sale to Tashir Group that commenced in the autumn of 2015.
Generation across the Group:
Indicator 2016 2015 +/-
Installed power generation capacity at the end of the reporting period, GW 32.524 34.968 -7.0%
Installed heat production capacity at the end of the reporting period, thousand Gcal/hour 26.018 26.351 -1.3%
Power generation, billion kWh 133.857 140.795 -4.9%
Utilization of installed capacity 46.8% 46.0% -
Heat distribution from collectors, million Gcal 40.532 39.613 +2.3%
Russian generation:
Indicator 2016 2015 +/-
Installed capacity at the end of the reporting period, GW 28.269 29.003 -2.5%
Installed heat production capacity at the end of the reporting period, thousand Gcal/hour 25.338 25.671 -1.3%
Power generation, billion kWh 120.005 127.163 -5.6%
Utilization of installed capacity 48.5% 50.2% -
Heat distribution from collectors, million Gcal 40.322 39.361 +2.4%

The following factors contributed to the reduction in the key performance indicators of the Generation Segment compared to 2015:

  • Retirement of 835 MW of legacy low-efficiency equipment in Russia, including 420 MW at Cherepetskaya TPP, 376 MW at Verkhnetagilskaya TPP, 35 MW at Yuzhnouralskaya TPP and 4 MW at Bashkir power generation facilities on January 1, 2016
  • Addition of 120 MW of new CDA power generation capacity to Omskaya TPP-3 and the launch of 13.5 MW (41 Gcal/hour) steam turbine at Ufimskaya TPP-2
  • Sale of 120 MW (328 Gcal/hour) Kumertau TPP in November 2016
  • An increase of 107.9 MW in power generation capacity and 31 Gcal/hour in heat production capacity resulting from the relabeling of Russian generation equipment
  • Reduced utilization of low-profit and low-efficiency power generation units, and maintenance downtime of certain units during low-price periods at the Day-Ahead Market
Foreign assets: generation, and distribution grids
Indicator 2016 2015 +/-
Installed capacity at the end of the reporting period, GW 4.255 5.965 -28.7%
Installed heat production capacity at the end of the reporting period, thousand Gcal/hour 0.68 0.68 -
Power generation, billion kWh 13.852 13.633 +1.6%
Utilization of installed capacity 35.8% 26.1% -
Heat distribution from collectors, million Gcal 0.21 0.252 -16.9%
Length of transmission lines*, km 5.082 36,877 -86.2%
Electricity delivery to the grid*, billion kWh 2.789 8.626 -67.7%
Electricity losses* 5.7% 17.5% -

* 2016 performance data represents only Telasi (Georgia). Prior to 2016, this data also included the performance of Electric Networks of Armenia

The main factors driving the key performance indicators were as follows:

  • Divestment of 1.1 GW Razdan TPP and Electric Networks of Armenia, as well as 600 MW Georgian Mtkvari Energy, from the Group
  • Increased deliveries from Kazakhstan to Russia resulting in an 1.8 billion kWh, or 55%, increase in the output of Ekibastuzskaya TPP-2, and reduced deliveries from Moldova TPP to domestic Transnistria market due to later start of the heating season
  • Low water levels in Georgia affecting the output of Khrami HPP, and low wind speeds in Lithuania affecting the output of Vydmantai Wind Park
  • Reduction in heat consumption in Kazakhstan and Transnistria during the heating season of 2016/2017
  • Addition of 256 kilometers to our transmission grid in Georgia as we built new grid connections and redundancy lines
Russian sales
Indicator 2016 2015 +/-
Consumer base, million 14.38 12.731 +13.0%
Electricity delivery to the grid, billion kWh 169.033* 165.876 +1.9%
Share of Russian retail market** 17.2% 16.0% -

* Includes the performance of LLC Bashkir Energy Sales Company starting from its acquisition in December 2016.

** Share of Russian retail market is defined as the ratio of retail sales to actual total electricity consumption (1,054.4 bn kWh in 2016 compared to 1,036.5 bn kWh in 2015 according to the System Operator of the Unified Energy System of Russia) Share of Russian retail market in 2016 is calculated including the full-year retail sales of LLC Bashkir Energy Sales Company that were 13.484 billion kWh, compared to 14.235 billion kWh in 2015.

Our customer base kept increasing due to the signing of new power supply agreements by individual Inter RAO Group companies with residential and commercial consumers in new communities, and also due to continued transition of customers from third parties.

Sales of electricity increased marginally, mostly due to the increase in customer base.

Commercial electricity import and export by Inter RAO Group across Russian borders:
Indicator 2016 2015 +/-
Export, bln kWh 17.002 17.492 -2.8%
Including:
Finland 5.282 3.383 +56.1%
China 3.320 3.299 +0.6%
Belarus 3.181 2.815 +13.0%
Lithuania 3.019 2.995 +0.8%
Kazakhstan 1.164 1.542 -24.5%
Georgia 0.406 0.511 -20.6%
Mongolia 0.300 0.284 +5.4%
South Ossetia 0.152 0.146 +4.3%
Ukraine 0.120 2.462 -95.1%
Azerbaijan 0.060 0.055 +8.6%
Import, bln kWh 3.143 1.464 2.15x
Including:
Kazakhstan 2.726 0.99 2.75x
Georgia 0.148 0.170 -13%
Azerbaijan 0.120 0.108 +10.9%
Lithuania 0.115 0.115 -
Mongolia 0.034 0.054 -37.5%

Key drivers of our export and import volumes:

  • Favorable prices in the Nord Pool Spot (Finnish energy zone) in 2016, with 9.4% increase in average annual price, to €32.45/MWh
  • 8.9% increase in EUR/RUB exchange rate (2015 average of 67.9929 rubles per euro compared to 2016 average of 74.0153 rubles per euro)
  • Increased deliveries of Russian electricity to Belarus under new arrangements with our partner
  • Resumed commercial deliveries from Kazakhstan to Russia due to their sufficient profitability.

OAO INTER RAO UES published this content on 15 February 2017 and is solely responsible for the information contained herein.
Distributed by Public, unedited and unaltered, on 06 March 2017 14:27:15 UTC.

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