Annual Report of the Open Joint-Stock Company «Yenisei Territorial Generation Company (ТGC-13)»” for 2006 (стр. 8 )

MODERNIZATION OF THE COMPANY

JSC “Yenisei TGC (TGC-13)”

(OJSC “Khakass Generating Company”)

Introduction of new technologies

·  Introduction of ASUTP (Automated System of Production Process Operation) TG, st. № 3 (2009).

·  Installation of the monitoring system of mechanical magnitudes vibration ТG, st. № 1 (2009).

·  Introduction ASUTP of the boiler unit, st. № 3 (2010).

Fulfillment of modernization and reconstruction program of JSC “Yenisei TGC (TGC-13)” in 2006

·  the planned amount of capital investments for the fulfillment of modernization and reconstruction program in 2thousand rubles.

·  actually run in 2thousand rubles.

Major works on modernization and reconstruction the means were directed to in 2006

·  introduction of AISCUE system;

·  replacement of bearing-rod insulators with polymeric ones on ОRU-110kV;

·  reconstruction of Abakan main heating networks from ТК93 to ТК95;

·  installation of pump 18NDS at pumping up station № 3 etc.

Fulfillment of repair works in JSC “Yenisei TGC ( TGC-13)”

2

Kind of equipment	plan	actual	Fulfilment of calendar plan, %	plan	actual	Fulfilment of calendar plan, %
Turbines, pieces (MW)	1 (110)	1 (110)	100	1 (110)	1 (110)	100
Power boilers, pieces ( t/h)	1 (420)	1 (420)	100	2 (840)	2 (840)	100
Heating networks, m	4,34	4,34	100	1,596	1,596	100
Replacement of heating surfaces, t	-	-	0	27	27	100

Notes:

1.  The quantity of repairs includes capital and mild repairs of the equipment.

2.  Current repairs of major heating engineering equipment for have been performed according to the approved schedule of repair.

Modernization of the Company 44

OJSC “Krasnoyarsk Generation”

Introduction of new technologies:

Krasnoyarsk CHP-1:

·  input in operation of АRChM of boiler units, st. # 13,14,;

·  introduction of system of chemical technological monitoring ( SHTM) on boilers, st.# 17-20; 4-16; on turbines, st. #3:

·  replacement of the electric precipitator of a boiler, st. #;

·  installation of PSU frequency regulation system, PP boilers, st.# 4;

·  introduction of ASUTP of t/u, st. # 9 and АSUTP of the t/u accessory equipment st.# 10;

·  ASUTP (IVK and auto regulation) for boilers, st.#8);

·  introduction of full-scale ASUTP of t/u, st.#4,12 ();

·  replacement of the hydraulic automatic control system (SAP) with the electro-hydraulic SAP of t/u, st. # 9 (2015).

Krasnoyarsk CHP-2:

·  reshaping ETH-175 in a peak boiler-house with installation of boilers КVTK-100 and network pumps ();

·  working-out of ASUTP of boilers and turbines ().

Krasnoyarsk CHP-3:

·  reconstruction of three water-heating boilers KVTK-100 with the increase in a heat rate up to 120 Gcal/h ().

Sosnovoborsky CHP:

·  fulfillment of a full-scale АSUTP of KP#3, NHPV2-1.HVO, MNS, КEV # 1-5, КV # 1, industrial heating systems ().

Minusinsk CHP:

·  introduction of a frequency-regulated drive on the fuel feeder equipment and on the boiler workshop accessory equipment ().

·  introduction of АSUTP of a fuel feeder path, on Zhulminsky Lake water intake, chemical workshop, heating network ().

Kansk CHP:

·  introduction of ASUTP b/u st.# 6, 7 (2010);

·  automatization of b/u st.# 1-7 on water chemical mode (2014),

Nazarovo SDPP:

·  replacement of CND of t/u, st.#2,3,6 Т-120/160-130 with CND of КПR1 type ();

·  replacement of PEN 3 “A”, 1”B " , 2 “A”, 4 “B”, 6 “B” with PEN of PE type with the frequency regulation ();

·  introduction of ARChM system on bl. st.#1,2, 3, 4, 7 on the basis of PTK “Simatik” ();

·  introduction of counterflow technology “UpCoRe” in the salt-free water preparation scheme ().

Fulfilment of modernization and reconstruction program of OJSC “Krasnoyarsk Generation” in 2006

The planned volume of capital investments for the fulfilment of modernization and reconstruction program in 2thousand rubles.

Actually run in 2thousand rubles.

Modernization of the Company 45

Major works on modernization and reconstruction the means were directed to in 2006:

Krasnoyarsk CHP-1:

·  reconstruction of the operating ash dump;

·  reconstruction of the fire-extinguishing system of cabel tunnels;

·  organization of fish-protecting structures;

·  installation of the ash trapping pilot industrial plant at t/u, st. #5;

·  organisation of ASKUE system.

Krasnoyarsk CHP-2:

·  replacement of the preheating steam pipeline t/u, st.# 5;

·  installation of the automatic fire-extinguishing system of fuel feeder paths;

·  reconstruction of the heating installation;

·  replacement of tape scales on fuel feeder conveyors LK-4А, B;

·  automated system of commercial calculation of the electric power;

Krasnoyarsk CHP-3

·  installation of the automatic fire-extinguishing system ;

·  reconstruction of the water network scheme ;

·  purchase and installation of conveyor scales;

·  installation of the electric drives of jaw bars of chimney ash pits;

·  installation of the automated operation system PSU KVTK - 100 st.# 3;

·  installation of the fire-prevention partitions and a suspended ceiling.

Nazarovo SDPP:

·  introduction of the vibrating control system;

·  reconstruction of the ash dump;

·  modernization of the boiler PK-38 st.#4B;

·  introduction of AIISKUE system.

Kansk CHP:

·  reconstruction of the ash-slag waste range;

·  reconstruction of the open hot water supply system with the use of potable quality water;

·  reconstruction of the hot water supply pump building;

·  reconstruction of feedwater pipelines of boilers, st. #1-2;

·  introduction of AIISKUE system;

·  reconstruction of an acid system.

Minusinsk CHP:

·  replacement of electric feedpump rotor ;

·  replacement of replacement of bearing-rod insulators with polymeric ones of SPK6-110/450, SPK10-35/160 type;

·  working out and introduction of ASUTP at the station of heating system pumping up P-1;

·  introduction of the system of automatic fire-extinguishing of fuel feeders;

·  modernization of accounting units and introduction of commercial data dispatching;

·  reconstruction of the watersupply system of boiler - houses of the towmships Shushenskoye and Tes.

Sosnovoborsk CHP:

·  replacement of the steam pipeline from a boiler-house to black oil pump-house;

·  installation of air-conditioning system;

·  reconstruction of an automatic system of technological parametres regulation (on the steam-boiler GM-50, st.#1);

·  installation of the fire-alarm security system at objects, etc.

Krasnoyarsk Heating System:

·  reconstruction of municipal heating mains;

·  reconstruction of the pump station # 10;

·  installation of the control valve at the pump station # 7.

Communication Network and Internet Technology Development 46

COMMUNICATION NETWORK AND

INTERNET TECHNOLOGY DEVELOPMENT

At present the following communication facilities belong to the Company :

·  fiber-optical communication line in Krasnoyarsk;

·  ATS with the increased capacity at the enterprises;

·  multiplexers "Transport", “ОGM - 30E”;

·  switchboards Cisco.

Prospects of communication networks development

·  Replacement of out-of-date radio-relay stations of Krasnoyarsk CHP-1, CHP-3 with newer, advanced ones.

·  Lining of a fibre-optical line to Krasnoyarsk CHP-3.

·  Creation of a network of Radio Ethernet.

·  Works on construction of a modern teleautomatics system.

·  Organization of the communication channel to Abakan CHP.

All works on development of communication networks are included in the business plan of the Company for 2007. A source of financing - depreciation charges.

The input of new objects allowed to raise essentially reliability of work of the dispatching-technological communication, to lower expenses for maintenance, to provide a high-grade information exchange between branches and dependent companies.

Internet-technologies

One of the major directions in the field of information technologies development is creation and use of web-applications as they are aimed at solving problems of effective information use and effective interaction between functional divisions of the Company by means of corporate and global networks.

JSC “Yenisei TGC (TGC-13)” has an official website presenting the basic information concerning the Company’s activities: news, production, electric power industry reforming, information to shareholders, investors and customers, competitions and purchases.

For information exchange between branches and dependent companies by means of modern software, FTP-server, accessible both through corporate and global networks is used. The system of electronic messages used in the Company proviodes an e-mail transfer between all branches, dependent companies and an external world. The updated antispam system together with the reliable anti-virus software product provide effective protection against harmful programs and undesirable letters.

In 2007 it is planned to transfer a significant part of industrial and financial program systems to web-technologies that will allow to provide transparent access to the administrative information and to use a uniform point of access to the corporate information.

Development of information technologies

In 2006 the project “Working out and introduction of the automated control system by JSC “Yenisei TGC ( TGC-13)” consisting of three stages and including automation of all contours of the Company’s management was started.

Pilot project

Accounting

Tax accounting.

Registration of mutual accounts with counterparts.

Logistics and storekeeping.

Contractual work accounting.

Management accounting.

Communication Network and Internet Technology Development 47

1st stage. Expansion

Maintenance service and repair of the equipment (TORO).

Personnel management.

Wages calculating.

Creation of information analytical system (IAS).

2nd stage. Duplicating

Duplicating of ASUP to the branches of the Company not participating in the pilot project and the first stage.

The aim of the project is introduction of informational systems for improvement of quality of the accepted administrative decisions providing effectivization of the major business processes and growth of the Company’s cost.

In 2006 the competition on choosing the service and software provider was held. The Contractor company became OJSC “Optima XChange Servises”

Creation of the uniform, integrated automated control system of ЕRP class will be fulfilled on the basis of software Microsoft Dynamics AX (Ахарta), capable to ensure information sufficiency for acceptance of administrative decisions.

The Charter of the project was approved, terms of realization were defined. The completion of the project’s last stage is planned for the middle of 2008.

In the Executive apparatus and branches of the Company inspection of business processes had been conducted. Requirements to subsystems were formalized.

All works under the project “Working out and introduction of ASUP of JSC “Yenisei TGC ( TGC-13)” are included in the business plan of the Company for 2007. A source of financing - depreciation charges and profit.

In 2007 it is planned to develop the conceptual project on automated subsystems, to perform ASUP testing and to prepare it for industrial use.

Purchasing Activity 48

PURCHASING ACTIVITY

Among various schemes of financial costs optimization purchase on a competitive basis are the most effective as they allow to choose a necessary product, work/service at ideal parity "price-quality".

Purchase of materials, equipment, contract works on reconstruction and construction, services in performance of design and exploration work, services on assets estimated activity, transportation, security and administrative services for the sum over 200,0 thousand rubles excuding the VAT is made on a competitive basis in JSC “Yenisei TGC ( TGC-13)”.

For the purpose of effective realization of energy repair production programs, modernization and reconstruction, capital construction, and also rational use of financial means and decrease in the operating costs related to purchase of production (goods, works and services) for JSC “Yenisei TGC ( TGC-13)” needs, modern competitive kinds of purchases are used:

·  open competition;

·  closed competition;

·  competitive negotiations;

·  open inquiry of prices:

·  open inquiry of offers, etc.

The Company’s Board of Directors approved procedural base and the package of standard documents for the organization and realization of the regulated purchase of products, works and services.

·  Regulations on the order of regulated purchases of products, works, services for the needs of OJSC “Khakass Generation Company” (on the basis of “System of Standards onArranging of Purchasing Activity. Purchasing” S-EES ZD4-2005) (Minutes # 3 from 30.09.2005).

·  Form # 1 of model of the Company’s purchase reporting with Methodical Instructions on filling (Minutes # 16/06 from 29.11.2006).

·  Form # 2 of a model of the Company’s purchase reporting with Methodical instructions on filling, Methodical recommendations on model filling in ARM (Minutes # 16/06 from 29.11.2006).

·  Regulations on granting of preferential amendments (Minutes # 3 from 30.09.2005).

·  Regulations on acceptance and realization of the Company’s Annual Complex Program of Purchases (GKPZ) with Appendix # 4 to Regulations of acceptance GKPZ for OJSC “Khakass Generation Company” ( Minutes # 16/06 from 29.11.2006).

·  Regulatons on Central Purchasing Body. Central Purchasing Body consists of (Minutes # 4/06 from 14.04.2006):

Purchasing Activity 49

·  Chairman - V. F. Eler

·  Deputy Chairman - D. D. Altergot

·  CPB members - N. G. Madzhuga, L. G. Likhmanovskaya, N. A. Petrakova, N. F. Krivolapova, A. V. Dolgopolov.

·  Secretary - K. A. Stepanova

·  Regulations on Department for Efficient Purchase Management (Minutes # 3 from 30.09.2005).

·  Internal Regulations on interaction of Services and Departments of JSC “Khakass Generation Company” at formation and realization of the Company’s purchasing activity (Minutes # 3 from 30.09.2005).

·  GKPZ of OJSC “Khakass Generation Company” for 2006, corrected in accordance with 2007 production programs (Minutes # 9/06 from 29.08.2006).

·  Preliminary GPKZ of OJSC “Khakass Generation Company” for 2007 (Minutes #9/06 from 29.08.2006).

The Board of Directors (Minutes # 7 from 22.12.2005) approved the list of mass media for the official documents declaring the start of open procedures and their termination to be placed in, to wit:

·  electronic trading platform - www. b2b-enegdo. gi

·  Company’s site - www. *****;

·  weekly republican newspaper "Chance".

The Permanent Purchasing Commission providing formation and realization of a uniform policy of purchase of products, works and services was established in the Company (order # 202 from 07.12.2005).

Functions of the Purchasing Commission

·  Preparation of necessary standard and methodical documents on planning and arranging of purchases.

·  Defining the form of the regulated procedures execution.

·  Formation of GKPZ and reports on GKPZ performance.

·  Consideration of issues and claims arising in the course of the Company’s purchase activities.

·  Organization of informational support of purchasing, interaction with mass media.

Environmental Protection 50

ENVIRONMENTAL PROTECTION

On February 16, 2007 “The Program of realization of an ecological policy of JSC “Yenissei TGC (TGC-13)” for the years of ” was approved by the Decision of the Board of Directors of JSC “Yenisei TGC (TGC-13)”.

The goal of the environmental policy of JSC “Yenisei TGC (TGC-13)” shall be increasing the level of environmental security, raising the capitalization by ensuring reliable and environmentally safe generation, transportation and distribution of energy and an integrated approach towards the use of natural energy resources.

This goal is expected to be achieved through the accomplishment of the following tasks:

1. Reducing the negative environmental impact of TES JSC “Yenisei TGC (TGC-13)”.

1.1. Reducing the level of air emissions:

-  nitrogen oxides;

-  solids;

-  sulphur oxides;

-  greenhouse gases.

1.2. Reducing the discharge of pollutants into water bodies.

1.3. Efficient use of water resources by thermal power plants.

1.4. Reducing the level of production waste.

1.5. Increasing the use of ash and slag waste.

1.6. Reducing specific emissions, discharge of pollutants per ton of fuel equivalent (kg/tfe) or unit of production (kWh, Gcal).

1.7. Reducing power losses in heat networks.

The principal areas for the accomplishment of the task shall be as follows:

·  modernization and step-by-step decommissioning of outdated equipment, implementation of the best available technologies of the generation, transportation and distribution of heat and electricity;

·  improvement of the engineering processes of generation, transmission and distribution of electricity, implementation of measures for energy conservation and reduction of power losses during transportation;

·  implementation of measures for the improvement of fuel supply efficiency;

·  reduction of production waste and promotion of its safe treatment, implementation of waste treatment measures;

Environmental Protection 51

·  economically and environmentally sound decentralization of power generation, optimization of the system of power supply to small customers;

2. Creation of conditions and mechanisms minimizing negative environmental impact of electricity industry.

The principal areas for the accomplishment of this task shall be as follows:

2. 1. Improvement of the Company’s management system in the domain of environmental protection, use of natural resources, emergency prevention and response, implementation of environmental management system in compliance with the requirements of international standard ISO 14001.

The environmental management system shall become an element of the corporate management system and an essential component of the non-financial risk management system applied by the Company. Its creation shall necessitate ensuring:

·  creation of specialized division of ecology as a part of the executive device of JSC “Yenisei TGC ( TGC-13)”;

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

·  acceptance of ecological programs containing concrete actions, terms and coordination with resource maintenance;

·  regular environmental audits of the existing electricity enterprises;

·  implementation of measures for the prevention and response to accidents having negative environmental effects;

·  planning economic operations with account taken of environmental targets, assessment and control of their achievement;

·  development of power facility personnel responsible for industrial and environmental security;

·  environmental monitoring and preparation of environmental reports;

·  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 (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.

Personnel and Social Policy 52

PERSONNEL AND SOCIAL POLICY

Main principles of personnel and social policy of the Company

·  Maintenance of optimum employment of workers, maximum use of skill and experience of each worker, intellectual potential of all manpower, effective organization of work and insuring its safety.

·  Raising of living standards of workers and members of their families, creation of system of social and labour rights and guarantees, improving the welfare of the Company’s workers, creating the sense of corporate affiliation and strengthening its attractiveness.

·  Realization 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 workers, development of motivation systems of highly productive work.

·  Dynamical development of the personnel management system.

Structure of the working staff

As of December, 31st, 2006 the number of the JSC “Yenisei ТGC (ТGC-13)” personnel made 6984 persons (taking into account joining OJSC “Krasnoyarsk Generation” and OJSC "ТGC-13" with the JSC “Yenisei ТGC (ТGC-13)”).

6793 employees are involved in main production and refer to the industrial production personnel, 186 employees are involved in nonproduction sphere.

Number of employees, persons

Categories of workers	Number as of December, 31st, 2006
Production personnel	6793
Non-production personnel	186
Personnel engaged in construction	5
Total “Yenisei ТGC (ТGC-13)” employees	6984

Categories of the personnel, number of persons

Categories of workers	Number as of December, 31st, 2006
Managers	1062
Specialists	1403
Office workers	59
Workers	4460
Total “Yenisei ТGC (ТGC-13)” employees	6984

Age structure of “Yenisei ТGC (ТGC-13)” employees

Total number	under 30 years old	30-40 years old	41-50 years	51-60 years old	Over 60 years old
6984	1051	2041	2160	1641	91

Personnel and Social Policy 53

Qualitative structure of “Yenisei ТGC (ТGC-13)” employees

Educational level of the Company’s employees is presented as follows (as of December, 31st, 2006):