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Russian networks Rosseti

Company

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The Russian Networks open joint stock company (JSC Rosseti, till 2013 IDGC Holding) is the energy company providing transfer and electric power distribution.

Owners:
Federal Agency for State Property Management (Rosimushchestvo) - 86.32%
213000 employees in 2013
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Assets

Assets

+ Russian networks (Rosseti, earlier IDGC Holding)

PJSC Rosseti – the operator of power networks of Russia – is one of the largest electric grid companies in the world. The company manages 2.30 million km of transmission lines, 490 thousand substations with a power more than 761 of GVA. Number of staff of Rosseti Group is 216 thousand people. The property complex of PJSC Rosseti includes 37 subsidiaries and affiliates. The largest shareholder of PJSC Rosseti is the state.

For 2013 the controlling shareholder is the state owning a share in authorized capital in the amount of 61.7%.

Subsidiary companies

Rosseti - a uniform name of an electric grid of Russia

Since June, 2019 all companies of a trunk and distribution electric grid in corporate and marketing communications and also on all carriers of the corporate style will use the new name supporting the trademark Rosseti and a regional or functional binding.

Implementation uniform a brand architecture, approved by Board of Directors of Rosseti company on April 29, 2019, provides step-by-step replacement of corporate elements in process of the termination of terms of their depreciation, without increase in the existing budgets and within the approved business plans of the companies.

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"The Rosseti group works in 80 territorial subjects of the federation, implements uniform approaches to management and development of power grid infrastructure of the country, constantly increases quality of the provided services, expanding their list. Transition to uniform the brand architecture is a natural and logical step on the way of development of holding. For consumers from different corners of our country it is important to understand what company bears before them responsibility for reliable and high-quality power supply. It is obvious that this company should have an identical name through the whole country" - the head of Rosseti company Pavel Livinsky emphasized.
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For 2013 the property complex of Rosseti includes packets of 43 subsidiaries and affiliates, including share blocks of 11 interregional, 5 regional network companies and a share block of the trunk network company.

For May, 2012 affiliated enterprises of IDGC Holding were among: IDGC of Centre, IDGC of the Northwest, IDGC of Centre and Volga region, IDGC of Volga, IDGC of Ural, IDGC of Siberia, IDGC of the South, IDGC of the North Caucasus, MOESK, Lenenergo, Tyumenenergo, Yantarenergo

Assets

Extent of transmission lines of the Company contains 2.3 million km, the transformer volume of 463 thousand substations - 726 gigavolts-amperes. Number of staff of Rosseti Group - 213 thousand people. The property complex of Society includes packets of 43 subsidiaries and affiliates, including share blocks of 11 interregional, 5 regional network companies and a share block of the trunk network company. The controlling shareholder is the state owning a share in authorized capital in the amount of 61.7%.

History of the company

2017

Rosseti, Skolkovo Foundation and Schneider Electric signed the tripartite agreement

On October 17, 2017 PJSC Rosseti, Skolkovo Foundation and Schneider Electric company signed the tripartite agreement about strategic partnership in the field of localization, development and deployment of a software and hardware complex of the systems of operational and technology management of the distribution electric networks of new generation. You look the System of operational and technology management of the distribution electric networks.

Pavel Livinsky releases Oleg Budargin from the CEO's duty

In August, 2017 it became known that the permanent CEO of Rosseti from the moment of creation of holding in 2013 Oleg Budargin leaves a post which was held by the head of department HOUSING AND PUBLIC UTILITIES Moscow Pavel Livinsky, it is a lot of years worked in the electric grid companies.

The prime minister Dmitry Medvedev announced to the head of the Moscow Department of Housing, Utilities and Amenities Pavel Livinsky that the government decided to recommend it for a position of the CEO of Rosseti.

From the moment of creation of Rosseti in 2013 them Oleg Budargin stretch directed. Nearly from the moment of appointment began to designate to Oleg Budargin fast resignation to Rosseti. In 2013-2014 sources of Kommersant assumed that in case of leaving it will release from a duty the Plenipotentiary Representative in the North Caucasian Federal District Alexander Khloponin going for increase (for 2017 - the Deputy Prime Minister) — the predecessor on a post of the head of Taimyr. Afterwards rumors regularly designated mister Budargin to a team of the Deputy Prime Minister, and his possible successors called Andrey Murov or are more rare than the Deputy Minister of Energy of the Russian Federation Vyacheslav Kravchenko. But Oleg Budargin steadily managed to save a chair of the head of Rosseti.

Rumors about his resignation renewed by June, 2017 when his candidate was not included in the directive of the government on the new structure of Board of Directors of Rosseti. Sources of Kommersant called him the successor of the first deputy chairman of VEB Mikhail Poluboyarinov or the CEO of the Russian Energy Agency (the Ministry of Energy is accountable) Anatoly Tikhonov. Oleg Budargin in an interview of Kommersant quashed on June 30 these rumors, connected the absence in the candidate list with the solution to increase number of independent directors and claimed that he does not see "any risks regarding the participation in further management of Rosseti".

2015: Rosseti SAP entrusted management of production assets

On October 28, 2015 it became known of conclusion of an agreement between SAP and Rosseti company about the beginning of combined actions on implementation of the concept of development of a management system for production assets of the last[1].

According to a joint statement of partners, efforts of experts will focus on the solution of key questions of implementation of "The standard development plan for a management system for production assets of subsidiaries and affiliates of PJSC Rosseti for 2015-2017". A system will help Rosseti company to increase efficiency of infrastructure maintenance and by that to improve business processes. For increase in its efficiency use of the HANA platform is planned.

Cooperation will promote consolidation of world practices and the experience of construction and operation of power networks existing in the company. It will give the chance to create new approaches to business process management in the industry which can be replicated and will provide development of the Russian power.

2013: IDGC Holding is renamed into Rosseti

The "Holding of the Interregional Distribution Grid Companies" open joint stock company is officially renamed into Russian Networks Open joint stock company (in English - Joint stock company "Russian Grids"). Corresponding changes in the Company charter are registered on April 4, 2013 by Interdistrict Inspectorate of the Federal Tax Service of Russia for Moscow No. 46 with entering of the corresponding record into the Unified State Register of Legal Entities (USRLE).

The decision on making changes and additions in the Charter of JSC IDGC Holding, regarding change of a trade name of Society, was accepted at Extraordinary General shareholder meeting JSC IDGC Holding of 3/23/2013 in pursuance of the Decree of the President of the Russian Federation of 11/22/2012 No. 1567 "About Russian Networks open joint stock company.

2012: Delegation of power of management in FGC UES

According to the Directive of the Government of the Russian Federation of May 8, 2012 the Agreement was signed on July 10, 2012 with JSC IDGC Holding (nowadays - Rosseti) about delegation of power of sole executive body of "Holding of the Interregional Distribution Grid Companies" Open joint stock company - Federal Grid Company (JSC FGC UES). Andrey Evgenyevich Murov is appointed the chief executive.

It was expected that this solution will allow to provide uniform approach to implementation of technical policy and the principles of management of an electric grid of Russia, to conduct accurately coordinated work on its effective development and upgrade on the innovation and high-tech basis, to pursue the uniform investment, financial and economic and HR policy, to systematically reduce costs. Creation of uniform rules will increase the level of reliability of power supply and also transparency and efficiency in questions of technology joining of consumers.

Formation of uniform requirements in the field of corporate standards of management will increase level of responsibility and independence of subsidiaries and affiliates, will create conditions for their more effective activity.

Consolidation of capacities of two companies will accelerate creation of the Network code regulating the general principles and approaches to activity of the enterprises of an electrical power complex.

Implementation of a complex of these measures will allow to increase cost efficiency of the Russian electrical power industry in general and will positively affect consumers.

For 2012 IDGC Holding integrates the interregional and regional distribution electric grid companies (IDGC/RSK), research and design institutes, the construction and sales organizations in the structure. 97 branches IDGC/RSK are located in the territory of 69 territorial subjects of the Russian Federation.

2008: Creation of IDGC Holding LLC

On June 30, 2008 process of reorganization of JSC RAO UES of Russia is complete. As a result of reorganization of JSC RAO UES of Russia by selection JSC IDGC Holding was created.

On July 01, 2008 in the Unified State Register of Legal Entities record about creation of JSC IDGC Holding by reorganization in the form of selection is made.

The purpose of creation of the issuer designated in the Concept of the Strategy of JSC RAO UES of Russia "5+5" accepted by Board of Directors of JSC RAO UES of Russia on May 29, 2003 was isolation by reorganization of JSC RAO UES of Russia of the company to which the stocks of all interregional distribution grid companies owned by JSC RAO UES of Russia were transferred.

2007: Selection of IDGC Holding from the structure of RAO UES

The IDGC Holding open joint stock company (it is renamed into JSC Rosseti later) is created as a result of reorganization in the form of selection from JSC RAO UES of Russia on the basis of the solution of extraordinary general shareholder meeting JSC RAO UES of Russia of October 26, 2007.

Authorized capital of the issuer by reorganization was created at the expense of the added capital and retained earnings of the last years of JSC RAO UES of Russia transferred on a separation balance sheet.

In December, 2007 – January, 2008 formation of target structure of all thermal OGK and TGC is finished, the first stage of consolidation of JSC RusHydro is completed.

Process of selection of the network companies is finished. Based on reorganized by AO-energo all 56 trunk network companies are created.

Structure of the industry of power in 2000

Main objective of reforming of power industry of Russia – increase in efficiency of the enterprises of the industry, creation of conditions for its development on the basis of stimulation of investments, ensuring reliable and regular power supply of consumers.

With respect thereto in power industry of Russia there were radical changes: the system of state regulation of the industry changed, competitive market of the electric power formed, the new companies were created.

Image:Структура отрасли электроэнергетики России в 2000-м году.png

During reform the structure of the industry exchanged: there was separation estestvennomonopolny (electric power transmission, supervisory control) and potentially competitive (production and sale of the electric power, repair and service) functions, and instead of the former vertically integrated companies performing all these functions the structures specializing in separate types of activity were created.

The companies created during reform represent the enterprises specialized on certain types of activity (generation, electric power transmission and others) and the controlling corresponding profile assets. On the scale of profile activity the created companies exceed former monopolies of the regional level: the new companies integrate the profile enterprises of several regions, or are all-Russian.

Thus, conditions for development of competitive market of the electric power which prices are not regulated by the state are created, and form on the basis of demand and supply, and its participants compete, reducing the costs.

The purposes and problems of reform are defined by the government decree of July 11, 2001 No. 526 "About reforming of power industry of the Russian Federation".

Taking into account subsequent changes in a regulatory framework of the purpose and a problem of reforming Concepts of Strategy of JSC RAO UES of Russia for 2005-2008 "5+5" were concretized in ".

Target structure of the industry

Backbone networks passed under control of Federal Grid Company, distribution networks are integrated into the interregional distribution grid companies (IDGC), functions and assets of regional dispatching offices are transferred to the all-Russian System operator.

Image:Целевая структура отрасли электроэнергетики России 2005.png

Assets of generation are also merged in interregional companies, and two types: the generation companies of wholesale market (the wholesale generating companies – OGK) and the territorial generating companies (TGC). OGK integrate the power plants specialized on production of almost exclusively electrical energy. The TGC include mainly combined heat and power plants (combined heat and power plant) which make both electric, and thermal energy. Six of seven OGK form based on thermal power stations, and one (RusHydro) – on the basis of the hydrogenerating assets. Thermal OGK are constructed by the exterritorial principle while TGC integrate stations of the neighboring regions.

The 1980-90th: Premises of reforming of power industry

In the 1980th years in power industry of the country signs of stagnation began to be shown: production capacities were updated much more slowly, than electricity consumption grew.

In the 1990s, during general economic crisis in Russia, electricity consumption volume significantly decreased, at the same time process of updating of capacities practically stopped.

The general situation in the industry was characterized by the following indicators:

  • On technology indicators (specific fuel consumption, average performance coefficient of the equipment, operating power of stations, etc.) the Russian power companies lagged behind the analogs in the developed countries.

  • There were no incentives to increase in efficiency, rational planning of the modes of production and electricity consumption, energy saving.

  • In certain regions there were power supply interruptions, the energy crisis was observed, there Was a high probability of major accidents.

  • There was no payment discipline, non-payments were widespread.
  • The enterprises of the industry were is information also financially "not transparent".
  • Access to the market was closed for new, independent players.

All this caused the necessity of conversions in power industry which would create incentives for increase in efficiency of the power companies and allowed to increase the investment volume into the industries significantly. Otherwise, at further expansion of the external economic cooperation, the Russian enterprises would lose an economic competition not only in foreign markets, but also in domestic market of the country.

Notes