2006 Social Responsibility and Corporate Sustainability Report (стр. 5 )

·  environmental risk management, development and implementation of relevant mitigation measures and compensation for resulting losses;

·  compliance by contractors performing work at the facilities of JSC “Yenisei TGC

43

(TGC -13)” with the standards and norms in the domain of industrial and environmental security, occupational safety;

·  revision, adjustment and improvement, as needed, of the Company’s environmental policy.

The goal, problems and the basic directions of environmental policy

The goal of the JSC «Yenisei TGC (TGC-13)» environmental policy is increase of environmental safety level, growth of capitalization at the expense of maintenance of reliable and ecologically safe generation, transportation and distribution of energy, the complex approach to the use of natural power resources.

To achieve the stated goal it is necessary to conduct constant and complex work reducing the harmful impact of the JSC «Yenisei TGC ( TGC-13)» enterprises on the environment.

Ecological efforts of the Company are concentrated on:

- Protection of air.

- Protection and effective use of water resources.

- Protection and effective use of land

- Decrease in influence of physical factors on the environment.

Air protection

Goals

For the operative equipment to provide conformity of the emission rate to the established standards, (MPE). By 2015 to achieve the following rate of specific air emissions:

- nitrogen oxides - 3,0 kg/t. f.e

- solids - 9,5 kg/t f. e

- sulfur oxides - 14,5 kg/t f. e.

For the newly commissioned equipment to provide the specific air emissions at the following rate:

- nitrogen oxides while black oil burning - 200-250 mg/m3

- nitrogen oxides while burning of brown coals - 250-350 mg/m3,

- sulfur oxides while coal burning - 400-850 mg/m3 (depending on capacity);

- solids - 50-100 mg/m3.

The basic directions of reducing the harmful air effect are:

- Increase in the enterprises’ power efficiency.

- Application of new technologies of burning of organic fuel (VIR-technology).

- Use of technological methods of suppression of nitrogen oxide formation in the boiler fire chambers.

- Efficiency increase of ash trap installations.

- Decrease in uncontrollable emissions.

Reducing nitrogen oxide emissions

To reduce nitrogen oxide emissions both technological actions and various technologies of smoke gas purification can be applied. As the basic way of reducing NOx emissions technological methods of suppression of nitrogen oxide formation are provided.

44

Reducing solid emissions

To reduce solid emissions the following actions are provided:

- Modernization of the existing battery cyclones with low trapping degree.

- Reconstruction of electric precipitators for the purpose of their efficiency increase.

- Construction of new EGA and EGB type electric precipitators with the increased area of active section, application of new modes of the power supplies and stirring of fields, automation of ash trapping processes.

|- Changing the fire chamber mode of the boiler.

Reducing greenhouse gas emissions

For the JSC «Yenisei TGC(TGC)» enterprises emissions of the following greenhouse gases formed while burning fuel are characteristic: carbon dioxide CO2, nitrogen oxide N2O. More than 99 % of all emissions are those of CO2.

To achieve reduction of greenhouse gas emissions is possible due to power saving technologies. As the main sources of emissions are stationary fuel burning installations, decrease in greenhouse gas emissions is possible with the help of:

- decrease in specific fuel flows by building high efficiency power installations;

- measures directed to economy improvement and decrease in specific fuel consumption (introduction of frequency-regulated drives of own needs, replacement of the worn out boiler heating surfaces, reduction of the quantity of start-ups, etc.).

According to the agreement signed with the Carbon Fund, inventory of greenhouse gases was made. As a result the database on emissions of greenhouse gases was created.

Protection and effective use of water resources

Goal

By 2015 to achieve:

- decrease in specific volume of fresh water use by 21 %;

- decrease in specific volume of irrevocable losses by 14 %;

- decrease in specific volume of discharge of the polluted sewage to water bodies of general use by 20 %.

In 2006 half of the JSC«Yenisei ТGC (TGC-13)» stations exceeded standards of maximum permitted discharge. It is associated with the absence of the pollution control facilities and purification technologies for a number of sewage flows. Besides, the projects of some stations did not provide for the systems of sewage treatment of the adjoining territory.

45

Table 6. Sewage classification

REFERENCE

Types of sewage Major pollutants by every type and their MPC, mg/kg Actions to reduce the polluted drains Sewage of chemical rinse of the equipment Iron - 0,3 Copper - 0,1 Hydrosin - 0,01 рН - 6,5-8,5 Сl - 100 for fish farming reservoirs Sewage of chemical rinse of the equipment goes to the hydraulic ash removing system Oil containing sewage Oil products - 0,05 for fish farming reservoirs Use of oil traps Hydraulic ash removing system sewage Suspended substances - at a background level рН - 6,5-8,5 Erection of recirculated hydraulic ash removing systems Blowing-off of waters clarifiers of water preparatory installations Suspended substances - at a background level рН-6,5-8,5 Utilization of slurry waters Mineralized sewage of water preparatory installations Chlorides – 300 Sulfates - 100 for fish farming reservoirs рН - 6,5-8,5 Modernization of chemical desalting systems, complexon application in feed water of the heating system

46

Measures to reduce the harmful effect on water bodies

Sewage of chemical rinse of the equipment

Sewage of chemical rinse of the JSC «Yenisei TGC(TGC-13)» TES equipment, having ash dumps, are discharged into the hydraulic ash removing system. For reduction of aggressive sewage quantity it is necessary to introduce technology of the thermal power equipment cleaning with "mild" methods of sediment removal by means of surface-active substances having biological degradation qualities. Transition to steam, water and oxygen cleaning and passivation of heating surfaces leads to the improvement of the stations’ ecology. Utilization of drained air for conservation of a steam-and-water path of the thermal power equipment will also result in nonuse (partial or complete ) of chemical reagents.

Oil containing waters

Standard TES projects provide for collecting and purifying of oil and black oil containing sewage on standard-type treatment facilities that work under the following scheme: collecting of oil containing discharge in a balancing tank, purifying in the oil trap, 2-phase filtration on the coal filters where the first step is filled with anthracite and the second - with activated coal. In TES with recirculated system of cooling the purified waters are supplied for feeding, in TES with direct-flow systems of cooling they are dumped into the drainage canal.

Sewage of hydraulic ash removing systems

In the majority of TES the recirculated hydraulic ash removing system is applied that makes the discharge of sewage practically impossible.

Blowing-off waters of clarifiers

In the JSC«Yenisei TGC(TGC-13)» TES the clarifiers work under the coagulation sulfur aluminum scheme. The sewage have low рН rate, contain aluminum salts, silicon acids, iron compounds, suspended substances. Blowing-off waters of clarifiers go to the treatment facilities of industrial intercepting sewerage.

Mineralized sewage of water preparatory installations

To decrease the effect of these waters on the water bodies reduction of their quantity due to the improvement of softening and desalting technology is provided, to wit:

Transfer of technology of preparation of the heating system feeding water to complexon stabilizing processing, that leads to considerable reduction of water used for own needs.

Reconstruction of the existing water preparatory installations, i. e. transition to the counterflow ion exchange technology of AMBERPAK and APKARE system, that will considerably lower the quantity of aggressive sewage, reduce the consumption of chemical reagents.

Replacement of domestic filter materials in filters of water preparatory installations with their import analogues (carboxylic cation exchangers, anion exchangers). The possibility to increase the filter cycle with the least loading volume gives considerable decrease in quantity of aggressive sewage.

Protection and effective use of land

Goal

To protect lands from the JSC «Yenisei TGC (TGC-13)» negative effect due to reduction of lands granted for ash 2015 to achieve the increase in volumes of ASW recycling ( by their removal to the exhausted open-pits ) up to 100 % of their annual formation.

47

Basic directions of land resources protection

Engineering protection

While constructing power stations of all types the projects should provide if necessary measures protecting lands from mountain torrents, erosion, landslips and other adverse phenomena.

Recultivaton of lands

Recultivation is carried out on the lands allocated for temporary roads, open-casts, buildings, facilities, that became unnecessary after completion of construction. Besides, territories of TES over age ash dumps and sites of other dismantled facilities are also subjects to recultivation.

Recultivation works include:

- dismantling buildings and constructions and removal them from the territory;

- territory filling and layout, covering with fertile soil layer and other works creating possibility for using lands for agricultural or other needs.

One of the major directions of environmental problem solving and reducing the ash dump areas being in operation of the JSC «Yenisei TGC(TGC-13)», is the acceptance of alternate removal and filling of ash dump sections with the removal of ash and slag mixtures to the exhausted coal and other open-cast mines for the purpose of their filling and further recultivaton.

In 2006 5,750 hectares of own areas of the filled sections of Krasnoyarsk CHP-1 ash dump was recultivated. 588 thousand tons of ash and slag waste from Nazarovo SDPP were taken out to the exhausted coal open-cast. A scheme on annual ash and slag waste removal of 500 thousand tons was worked out at the plant. Krasnoyarsk CHP-2 ash and slag dump № 1 is divided into sections with their alternate filling and cleaning. Dehydrated ash and slag waste are taken out to the ash dump № 2, located in the exhausted limestone open-cast.

Protection of lands from ash dump dusting

For the power stations working on a solid fuel, considerable areas of land occupied with ash dumps are characteristic. Ash dumps of the JSC «Yenisei TGC(TGC-13)» TES are an environmental contamination source, in particular, of soils with dust emissions.

There are various ways of dust suppression while operating ash dumps - humidifying of their surface, overhead irrigation, maintenance of a higher water level by means of clarified water feeding.

To prevent dusting of the filled ash dump sections their conservation is carried out, including covering with a vegetative land layer, crop of a meadow grass mix, top dressing with mineral fertilizers and watering during 2 years till formation of a close in grass layer.

Ash and slag waste recycling of is the important nature protection action bringing economic benefit and helping to reduce land pollution.

Ash and slag waste recycling

Negative effect of ash and slag wastes on the environment is caused by withdrawal of large areas used for ash dumps from economic circulation.

One of the basic directions of the JSC «Yenisei TGC (TGC-13)» nature preservation activity on solving TES ASW problem was determined construction of installations on selection, shipment to

48

consumers and processing of dry ashes into marketable production, and also setting-up of slag shipment units.

With this aim an installation on selection and processing of dry ashes with 100 thousand tons per year capacity was put into operation in Krasnoyarsk CHP-1. An installation on selection and shipment of slag with the capacity of 36 thousand tons per year was commissioned in Krasnoyarsk CHP-2. In Krasnoyarsk CHP-1 the feasibility study on mechanical separate removal of ashes and slag was developed. If there are any consumers available ashes and slag are shipped by trucks or wagons. Excess ashes are humidified on the platform and taken out with trucks to the ash dump located at a distance of 6km from the plant.

Basic directions on increase in ASW use

For the successful decision of a problem of ash and slag waste recycling and maintenance of the minimum ecological damage while creating and modernizing systems of ASU first of all it is necessary to observe the following main principles:

- separate removal of ashes and slag;

- possibility of a 100 % collecting and shipment of dry ashes;

- environmentally sound ways of placing of a dead part of dry ashes and slag (granulation, filling of quarries and open-cast mines, etc.);

- improvement of the equipment and the schemes of separate units, installations and ASU system;

- maximum mechanization and automation of technological processes.

The most acceptable for practical application is the system of dry-collected ashes removal as it is always classified according to the electric precipitator fields by fractional structure. Such ashes can be stored dry in silos and applied in manufacture without additional preparation. The system of the removed ashes feeding to the concrete mixing units is similar to cement feeding system.

The primary goal of the JSC «Yenisei TGC(TGC-13)»TES, equipped with electric precipitators and cyclones, is its equipping with installations for dry ashes collection.

Environmental protection from physical factor effect

The JSC «Yenisei TGC(TGC-13)» stations effect the environment by physical factors: electric field and acoustic noise.

Goal

Not to exceed the established standards of physical factors.

Electric field

The main sources of electric fields are overhead lines of power transmission (OL) and open switching centers (OSC ) of power stations and substations (SS).

Effect of the power station OSC electric field is within the limits of the fenced territory.

Acoustic noise

The major sources of noise located in the open air, in the power stations are: induced-draft mechanisms, transformers, cooling towers, chimneys, gas distributing stations, gas pipelines, steam-out devices, air in-takes of the blowing fans.

The problem of reduction of power equipment noise is an acute one, especially in the power stations located within the city boundaries, near residential areas. It is enough to tell,

49

that the size of the power station’s SPZ is usually set proceeding from the condition of noise impact restriction.

Reduction of the power equipment noise impact is carried out in three basic directions:

- reduction of noise in a source;

- reduction of noise on the ways of its distribution;

- architectural and planning decisions.

The choice of measures on noise suppressing is accepted on the basis of technical and economic estimation. While constructing facilities or installing the new equipment on the power stations being the sources of noise, measures on noise suppression are developed at the stage of designing. This approach gives possibility to lower expenses on realization of the stated measures.

Introduction of environmental management system at the enterprises of the electric power industry

The system of environmental management should be coordinated with the system of non-financial risks management and timely provide information for revealing environmental risks and their analysis, estimation of possible damage, decision-making on determination of risk admissibility level, optimization of damage prevention expenses or minimization of negative consequences for public health, state of the environment, corporate reputation.

The system of environmental management will allow the Company:

to determine environmental policy appropriate for the Company itself;

to identify the ecological aspects proceeding from its past, present or planned activities, production or services, so that to determine the essential impact on the environment;

to identify the corresponding legislative and procedural requirements;

to identify priorities and to determine the corresponding target and planned ecological indicators;

to develop the organizational scheme and programs for the policy implementation and achievement of target and planned ecological indicators;

to promote planning, control, monitoring, correcting action, audit and analysis to provide both conformity of the environment management system with the determined policy, and its maintenance at the appropriate level;

to be capable to accommodate to changing circumstances.

From the point of view of risk management any risk associated with a direct hazard to people’s life or danger of an environmental disaster is considered catastrophic (inadmissible).

Introduction of environmental audit

Environmental audit is the important means of checking environmental efficiency and rendering assistance in its increase.

General principles the Company’s environmental audit system will be based on:

- the audit should be based on the goals determined by the organization;

- the auditors’ conclusions should be objective, independent and competent;

- the auditor should follow procedures of quality assurance;

- the environmental audit should be carried out according to the main principles

50

and the guidelines developed for the corresponding type of environmental audit;

- the process of carrying out the environmental audit should be planned;

- the results of the audit should be stated in the written report.

Mechanisms of realization of the environmental policy

Organizational mechanisms of the JSC «Yenisei TGC(TGC-13)» environmental policy include:

- use of corporate procedures for creation of environmental management system;

- creation of specialized environmental division as a part of the executive body of the JSC “Yenisei TGC ( TGC-13)”;

- creation of corresponding structural divisions in all branches of the JSC “Yenisei TGC( TGC-13)”:

- acceptance of environmental programs containing concrete actions, terms and coordination with resource maintenance;

- coordination of preparation and implementation of the investment projects aimed at reduction of greenhouse gas emissions with the Power Carbon Fund.

The sources of finance of the JSC «Yenisei TGC(TGC-13)» environmental activity can be both own and borrowed.

"Carbon" credits, application of funds under the scheme of "green" investments, and also a cession of rights to sulfur and nitrogen oxide emissions, positively proved as a market mechanism of environment management can become the new sources of finance of nature protection activity in the electric power industry.

51

A polar she-bear covers her children from cold in winter. The bear cub cannot get by without parental warmth within the first two years of his life.

A polar bear can overcome by swimming the distance of 160 km.

The length of the Yenisei TGC (TGC-13) heating systems - 743 km.

52

LABOR RELATIONS AND PERSONNEL MANAGEMENT POLICY

In the situation when the deficiency of qualified employees becomes an obstacle for the Company’s development, the main principles of the JSC «Yenisei TGC (TGC-13)» personnel policy are:

·  Maintenance of optimum employment of employees, maximum use of skills and experience of each employee, intellectual potential of all manpower, effective organization of labor and its safety.

·  Rise in the living standards of employees and members of their families, creation of system of social and labor rights and guarantees, improving the well-being of the Company’s employees, forming a sense of corporate affiliation and strengthening its attractiveness.

·  Practical implementation of principles of social partnership and mutual responsibility of the parties in the relations of representatives of the employer and representatives of employees.

·  Creation of necessary conditions for effective, professional and personal growth of employees, development of motivation systems of highly productive labor.

As of December, 31st, 2006 the number of the JSC “Yenisei ТGC (ТGC-13)” personnel made 6983 persons (taking into account joining OJSC “Krasnoyarsk Generation” and OJSC "ТGC-13" with the JSC “Yenisei ТGC (ТGC-13)”).

6797 employees are involved in main production and refer to the industrial production personnel, 186 employees are involved in non-production sphere.

Personnel age structure

1051	2041	2160	1641	91
under 30 years old	30-40 years old	41-50 years	51-60 years old	Over 60 years old

Table.7 Age structure of the personnel

Total	6984
under 30 years old	1049
30-40 years old	2042
41-50 years old	2160
51-60 years old	1641
Over 60 years old	91

Table 8. Rotation of the JSC «YeniseiTGC(TGC-13)» personnel

Categories of employees	2005	2006
Employed	Dismissed	Employed	Dismissed
Managers	13	7	183	187
Specialists	41	24	484	440
Office workers	1	0	17	13
Workers	37	34	536	475
TOTAL:	92	65	1220	1175

The significant growth of indicators on the employed and dismissed workers in 2006 is caused by the Company’s reorganization (joining the OJSC «Krasnoyarsk Generation» and the OJSC " TGC-13").

53

Categories of employees in 2006

Managers 1061 15%

Specialists 1403 20%

Office workers 59 1%

Workers 4460 64%

Table 9. Structure of the personnel, by number

Personnel number	Total as of 31.12.2006
Total JSC “Yenisei TGC(TGC-13)” personnel, including	6983
Production personnel	6792
Non-production personnel	186
Personnel engaged in construction	5

Structure of the personnel in 2006 , by number

Non-production personnel 186 persons 3%

Production personnel 6793 persons 97%

Table 10. Number of employees by category