During the first half of 2012, companies in Russia generated 541.3 billion kilowatt hours of electricity, a figure that represents 102.2 percent of production for the corresponding period of 2011. In June 2012 alone, electricity generation was 74.7 billion kWh, some 102.1 percent of the figure from June 2011.

Power consumption in the Unified Energy System (UES) of Russia in June 2012 amounted to 71.3 billion kilowatt-hours, which is 1.6 percent higher than the consumption in June 2011. Power consumption for June 2012 in Russia reached 72.8 billion kilowatt-hours, which is 1.6 percent more than in June 2011.

Electricity consumption in the first half of 2012 amounted to 533 billion kWh, which is 2.6 percent more than in the corresponding period of 2011. In June 2012, consumption stood at 73.8 billion kWh, or 3.1 percent more than in June 2011.

In June, the projected slump in the consumption of electric energy and power relative to the autumn-winter period continued. The maximum power consumption of the UES of Russia in June 2012 was 110,418 MW, while in April and May 2012 the figure was 127,642 MW and 112,412 MW respectively. At the same time, the maximum electric power consumption in the UES of Russia in June 2012 was 2.2 percent more than in June 2011, or 108,027 MW.

The balance of power flow of export-import supplies of electricity in the first half of 2012 is estimated at 8.3 billion kilowatt-hours, which is 21.8 percent less than in the corresponding period of 2011. This is associated with a decrease in exports to Finland.

In the first half of 2012,1785.8 MW of new capacity entred into service. Some 775.5 MW of capacity was decommissioned.

The highest growth of both production and consumption in the first half of 2012 came from the eastern region of the country, where production for the six months of 2012 went up by 5.5 percent over the same period of the previous year. In June, the highest rates of growth in production and consumption were recorded in the Middle Volga and the South – 11.3 percent and 5.3 percent respectively. Electricity production for the first five months of 2012 decreased in the North West by 8.6 percent, due to the decline in exports to Finland and unfavorable market conditions.

Power consumption for the first half of 2012 increased most in the eastern part of the country, by 3.6 percent of the figures for January-June 2011. All Russian regions exhibited consumption growth for the six months.

Siberia and the southern part of Russia experienced an energy deficit in the first half of 2012. In Siberia, the deficit was associated with an unfavorable hydrological situation in a number of rivers. In the first half of 2012 electricity generation at the Angara-Yenisei installation decreased by four billion kWh, or 9.4 percent, in comparison with the corresponding period of 2011.

In the regional context, the highest growth rate of electricity production in the first half of 2012 was observed in the Voronezh region, where the increase was two and a half times last year’s results. The sharp rise in production is associated with the completion of the modernization program at the fifth unit of Novovoronezh NPP. The high growth in production in the Smolensk region is associated with the completion of planned maintenance at the Smolensk atomic plant.

According to the Ministry of Economic Development, the heavy burden of meeting electricity demand in the first half of 2012 was laid on thermal power plants. Electricity generation at thermal plants increased by 2.1 percent compared to the same period in 2011 and amounted to 369 billion kWh. Nuclear power plants over the same period increased power production by 9.6 percent to 91.6 billion kWh. Hydropower stations decreased generating activity by five percent to 80.3 billion kWh. Not all hydro stations saw declining results, however. The Volga-Kama installations increased production by 1 billion kilowatt-hours, some 5.2 percent over last year’s figures.

In the first half of 2012 the structure of electricity generation by type of source compared to the same period of 2011 demonstrated the following results: the proportion of electricity generated by nuclear power plants increased from 15.8 percent to 16.9 percent; the share of electricity produced by thermal power plants decreased from 68.3 percent to 68.1; and the portion of electric power generated at hydropower plants went down from 15.9 percent to 14.8 percent.

In August, the Ministry of Energy published a scheme and program for the Unified Energy System in the years 2012-2018. In this document, the Ministry officially recognized that the government-approved investment programs aimed at achieving target capacities would not be enough. The plan identifies certain technologically necessary electric power generation installations, i.e., power plants, which are needed to maintain the functionality of the Russian power system. According to the document, four regions of the country need to have built an additional 1.3 GW of generating capacity.

The most urgent need in this generating capacity, according to the plan, is in the southwestern power energy system of Kuban. By 2015 that region will experience an active deficit of electric power. In the event that repairs of the 500 kV transmission line from Tikhoretsk to Kuban are initiated ahead of schedule, the shortfall can already become noticeable in 2013. By 2016, according to the projection, the shortage will be between 172 MW and 572 MW. To prevent the deficiency, it is necessary to build up to 600 MW of generation capacity, including two units with the capacity of 100 MW of power in Novorossiysk.

In addition, there is a need to build a 400 MW station in the south-eastern power district. Tuva requires not less than 110 MW of generating capacity. Another 200 MW of capacity must be installed at the Bodaibinskiy and the Mamsko-Chuisky energy districts in the northeastern part of the Irkutsk region.

The situation is better in the Far East, where Rosneft is going to build a thermal power plant with the capacity of 685 MW by 2017. The main objective of the power station will be the provision of energy supplies to the petrochemical complex of Rosneft. Surplus electricity would be supplied to other consumers. Major investment projects to build new power generating facilities in Primorye have been undertaken by East RAO EUS. As such, already in 2014, a thermal power plant East with the capacity of 140 MW is scheduled to enter service in Vladivostok. In 2017, a thermal plant with the capacity of 370 MW is due to be commissioned in Ussuriysk.

The Ministry of Energy plans the construction of entire electricity supply networks. For example, the needs of the Irkutsk region include the construction of a 220 kV substation with a transmission line from Taksimo to Mamakan capable of carrying 110 kV to 220 kV by 2014. In the same region, it is planned to construct a 220 kV line from Peleduy to Chertovo Koryto to Sukhoi Log to Artemovskaya to Mamakan. A memorandum of cooperation on the project was signed in June between the Federal Grid Company, Polyus Gold, the Foundation for the Far East and the Baikal region (owned VEB) and the authorities of the Irkutsk region and the republic of Yakutia. The need to build capacity in this area is attributable to the planned addition of commercial and private consumers requiring 250 MW.

In view of these circumstances, it is not surprising that the Energy Ministry intends to affirm through legislation its right to control the execution of investment programs not only by government entities, but also by private power companies. A bill amending article 21 of the Law on the Electric Power Industry has already been published on the website of the Ministry of Economic Development. Currently, the Ministry can subject to its approval the programs of energy companies, where the state’s share is at least 50 percent. This is primarily RusHydro, Inter RAO, FSK, and MRSK Holding. In addition, the Ministry can regulate investment plans for the construction of any installations with capacity greater than 50 MW, if the funding comes from the state budget.

Meanwhile, the Ministry as of now has no authority to control the implementation of the investment programs of private generators.

Fuel supplies

Fuel stocks at the end of June 2012 increased in relation to last year’s level, and in relation to the level of the first quarter of 2012. According to the Ministry of Economic Development, in January-June 2012, power plants received deliveries of 50.7 million tons of coal, representing a 107.5 percent increase compared to the levels for June 2011, and 681.3 thousand tons of heavy fuel oil, which is only 65.5 percent of the total for the corresponding period of 2011.