Rosseti wants to merge with System Operator in light of recent grid failures
MOSCOW. Oct 19 (Interfax) - Rosseti , Russia's state grid company, has returned to the idea of merging with System Operator UES (SO UES) against the backdrop of increasingly frequent failures in power grids.
Rosseti's new CEO, Pavel Livinsky proposed this idea, which was discussed several years ago, in a letter to Prime Minister Dmitry Medvedev, a copy of which was seen by Interfax. Rosseti's main argument is that the configuration of relay protection and automation systems is carried out at Rosseti grid facilities, but they parameters for these systems are set by SO UES.
Arguing the upside of a merger, Livinsky cites the experience of European countries such as France, Italy and the UK, where "the functions of the system operator are integrated into large grid companies."
Rosseti believes that one of the reasons for recent grid failures is the lack of a unified center of responsibility for reliable power supplies to consumers. Livinsky proposed to create such a "unified center of reliability and provision of services" based on the power grid company, with SO UES being integrated into Rosseti.
How the merger would be carried out and whether it would involve switching to a single share is not specified in the letter. The state owns 100% of SO UES and 88.04% of Rosseti.
A spokesman for Deputy Prime Minister Arkady Dvorkovich, whose brief includes power grids, confirmed that the government has received such a letter and said the Energy Ministry is looking into it. The ministry refrained from commenting on this issue.
This is not a new idea. Former Rosseti CEO Oleg Budargin made a similar proposal to the Energy Ministry in 2013. This proposal was also included in plans to curb the final costs of the goods and services of infrastructure monopolies while maintaining their financial stability and investment appeal that the Economic Development Ministry drafted and proposed to the government at the time.
SO UES said that a similar proposal was rejected by the government in 2013 "as inadvisable." The company said that an independent state system operator is a "necessary technological instrument of the Energy Ministry and other government agencies to receive objective information that is independent of the interests of individual market entities about the condition and operation of the energy system and all facilities that operate as part of it (including grid facilities)." SO UES said that handing this role over to one interested party would "deprive the process of transparency."
In addition, SO UES said that relay protection systems are not only located in Rosseti grids, but also at all generating facilities, the power receiving systems of major consumers and other facilities. SO UES also said that "all world experience shows the reverse trend - the separation of the operational dispatch management function into a separate entity where it has not been separated yet."
Rosseti has not provided comments yet.