Chapter 3
BUSINESS REVIEW

3.4. Operational results

Events of 2015

Installed capacity increased by 217.8 MW (+0.6 %) to 38,652.0 MW.
Output rose by 5362.5 GW (+4.5%) to 127,379.9 GW.
Electricity sales growth – by RUB 1,904.4 million.
The reservoir of Boguchanskaya HPP filled to a design level; the plant reached its design capacity of 2,997 MW and design mode of station operation.
A unique 14-kilometer tunnel for Zaramagskaya HPP-1 was finished.
Sayano-Shushenskaya HPP increased its maximum output capacity to the power grid to 5,100 MW due to the modernisation of its automation system.
14 hydroelectric units with a total capacity of 1,171 MW were replaced and modernised.

RusHydro production assets

Name	Generation (million kW·h)			Productive supply (million kWh)			Installed capacity (MW)
	2013	2014	2015	2013	2014	2015	2013	2014	2015
The Bureiskaya HPP	6584.7	6065.9	5830.3	6431.9	5921.2	5690	2010	2010	2010
The Zeyskaya HPP	6859.8	6427.8	4280.7	6610.6	6186.8	4043	1330	1330	1330
The Novosibirskaya HPP	2400.3	2117.9	2092.5	2376.3	2096.6	2068.8	460	460	465
TheSayanp-Shushenskaya Cascade of HPPs	24875.3	20374.6	20626	24774.9	20270.4	20454.1	6721	6721	6721
The Kamskaya HPP	1984.8	1998.4	2463.8	1953.4	1967.4	2433.8	537	543	549
The Votkinskaya HPP	2527.4	2792.5	3210.9	2475.8	2735.8	3148.2	1020	1020	1020
The Upper Volga Cascade of HPP	1643.1	863.3	723.3	1607.9	838.3	702.6	466.6	476.6	476.6
The Nizhegorodskaya HPP	1870.6	1281.2	1168.7	1844.2	1259.7	1149.8	520	520	520
The Cheboksarskaya HPP	2291.3	1889.6	1632.6	2230.3	1833.6	1578.3	1370	1370	1370
The Zhigulevskaya HPP	11705.4	10484.1	10398.3	11600.3	10380	10307.1	2362	2383	2404
The Saratovskaya HPP	6001.7	5599.6	5560.3	5895.7	5504.6	5469.1	1369	1378	1391
The Volzhskaya HPP	12839	11565.9	10999.4	12685.8	11416.6	10870.8	2629	2639.5	2650
The Zagorskaya PSPP	1490.4	1859.7	1841.5	1440.2	1808	1791.4	1200	1200	1200
The Kubanskaya Cascade HPPs	1484.2	1383.6	1299.1	1455.6	1353.5	1271.3	476.5	476.5	476.5
Karachaevo-Cerkessia branch	470	1.7	336.2	466.9	-1	331.1	160.6	160.6	160.6
Kabardno-Balkaria branch	575.2	564.7	478.7	567.4	556.7	471.2	157.5	157.5	157.5
North Ossetia branch*	357.5	293.4	267.4	352	287.7	261.3	94.5	94.5	94.5
Dagestan branch	5208.6	4014.1	4196.8	5161.4	3970.2	4156.2	1785.5	1785.5	1885.5
Total	91169.4	79578.1	77406.4	89930.6	78385.9	76198	24669.3	24725.8	24881.3
The Kolymskaya HPP	1923.8	1558.4	1672.8	1880.7	1516.3	1628.1	900	900	900
The Ust-Srednekanskaya HPP	120.9	372.9	280.5	116	360.6	267.8	168	168	168
Geothermal Power Plant	392.4	405.5	409.7	359.5	371.8	376.4	62	62	62
The Pauzhetskaya GeoPP	41.9	42.3	42.3	34.6	35.2	34.8	13.6	13.6	13.6
JSC IEC	467.9	474.7	453.4	458.6	465.3	444.3	561.4	561.4	561.4
The Kamchatka HES*	37.2	38.8	39	35.7	37.5	37.8	24.8	24.8	24.8
The Boguchanskaya HPP	4897.1	8361.7	13076.8	4862.8	8306.9	12995	1998	2997	2997
CJSC Blagoveshchenskaya CHP									120
RAO Energy Systems of the East Group	30000.8	31155.9	33970.2	25779.7	27246.3	29831.9	9070.9	8981.7	8924
Total	129051.5	121988.3	127350.9	123458.3	116725.7	121814.2	37467.9	38434.2	38652

3.4.1. Installed capacity

The total installed capacity grew by 217,8 MW to 38,7 MW in 2015. The decrease in capacity of the RAO Energy Systems of the East Group by 57.7 MW was compensated by the commissioning of Gotsalinskaya HPP ( with the capacity of 100.0 MW) and Blagovesсhensk CHP (120.0 MW of capacity).

The growth of installed capacity also happened due to equipment remarking:

Novosibirskaya HPP – by 5.0 MW;
Kamskaya HPP – by 6.0 MW;
Zhigulevskaya HPP – by 21.0 MW;
Volzhskaya HPP – by 10.5 MW;
Saratovskaya HPP – by 13.0 MW.

RusHydro Group has always occupied the first position in the rating of installed capacity among Russian power suppliers. The implemented investment programme gives grounds to expect it to save its leading position.

Installed capacity³¹,
MW

RusHydro electricity
production dynamics³³, GW

RusHydro electricity supply dynamics³³, GW

3.4.2. Electricity output

In 2015 electricity output grew by 5.36 billion kW·h (+ 4.5%) to 127,3 billion kW·h. Decrease of the electricity output of Zeyskaya HPP (-2,15 billion kW·h) was compensated for by the growth of the output of Boguchanskaya HPP (+ 4,72 billion kW·h) and at the plants of RAO Energy Systems of the East Group (+ 2,81 billion kW·h).

3.4.3. Electricity and capacity sales

For 2015 net sales of electricity and capacity by branches of PJSC RusHydro, which takes into account the purchase of electricity and capacity costs, increased by 2.9% y-o-y and amounted to 91 952.8 million rubles. The main factors that influenced the increase in revenue due to lower volume of electricity production by 2.7%:

the growth of the DAM price in the second price zone due to:
the growth of capacity purchase price at the КОМ for second price zone HPPs due to the liberalisation of the HPP capacity market dd. 05/01/2014;
the indexation of adjustable electricity and capacity tariffs;
the decrease of the amount and cost of purchasing electricity.

RusHydro net revenues changes, RUB mn

	2014	2015	Changes	Changes,%
Sales	107,296.8	105,923.0	-1,373.9	-1.3
- Cost of electricity sold	76,532.4	73,262.4	-3,269.9	-4.3
- Cost of capacity sold	30,678.2	32,582.6	1,904.4	6.2
- Services of Regional Distribution Grid Company	86.3	77.9	-8.4	-9.7
Purchasing expenses	17,975.5	13,970.2	-4,005.3	-22.3
- Cost of electricity purchased	17,965.1	13,957.3	-4,007.8	-22.3
- Cost of capacity purchased	10.4	12.9	2.4	23.2
Net revenue	89,321.3	91,952.8	2,631.5	2.9

3.4.3.1. Electricity sales

Revenues in the DAM occupy the first position in the structure of the electricity sales revenues of the branches of PJSC RusHydro. Thereby, its share grew from 77.5% to 81.9% (+ 5,7%) in 2015 against the decrease of sales as per free bilateral contracts (FBC) by 29.% and the decrease of the volume of electricity sold in the balancing market (BM) by 7.1%.

RusHydro electricity sales and dynamics, RUB million

3.4.3.2. Capacity sales

The main part of revenue from sales of capacity by the branches of PJSC RusHydro is formed by contracts signed within the CPA. Following the results of 2015, the share of such contracts grew from 54.6% to 55.2% with the growth of corresponding revenue by 7.5%. 46 % growth was registered as per contracts on capacity provision. In 2015, revenue went down by 21% as per free bilateral contracts.

Capacity electricity sales and dynamics RUB million

Optimisation and increase of efficiency of operating activities

Pursuant to directive of the Government of Russian Federation no. 2303p-P13 dated 04/16/2015 on the decrease of operating costs (expenses), RusHydro Group implements a complex of measures aimed at the reduction of the index of the decrease of operating costs (expenses) by at least by 2% per annum starting from 2015.

The total effect of the implementation of such actions in 2015 (adjusted to meet inflation) against 2014 amounted to RUB 1.89 billion (adjusted to meet the actual rate of inflation), including RUB 0.64 billion of PJSC RusHydro (-3.9%) and AO – RUB 1.25 billion.

The total scheduled effect of the implementation of actions on the reduction of operating costs in 2016

	Bln RUB	% of the level of 2015 including inflationary expectations
PJSC RusHydro	3.73	(-14 %)
PJSC RAO Energy Systems of East	5.23	(-7 %)
TOTAL by the Group	8.96	-9.20%

RUB billion

operational expenditures
decreasing

3.5.
International Cooperation

Chapter 3 BUSINESS REVIEW