Nord Hydro, VEB may invest 2 bln rubles in small hydro plants
CHEREPOVETS. Sept 6 (Interfax) - Nord Hydro, a company that builds and overhauls small hydropower plants, is in talks with Russian bank VEB to secure financing for a number of projects that will require investments of about 2 billion rubles.
"Negotiations with VEB are now in the final stage. The amount of projects being discussed is 2 billion rubles," Nord Hydro managing director Alexander Vinogradov said Monday at a presentation of the company's projects at United Russia's interregional party conference in Cherepovets.
The materials for the conference describe two company projects in which VEB is acting as a co-investor: the Ryumyakoski hydro plant with capacity of 0.63 MW and an estimated cost of 144 million rubles and the Lyaskelya plant with capacity of 4.8 MW and a cost of about 687.4 million rubles. The projects, both of which are located in Karelia, are scheduled to be completed by 2013, according to the materials.
"Nord Hydro plans to achieve independent production of about 1 billion kWh per year by the end of 2020. In other words, build 100 plants in ten years," Vinogradov said.
He said the company has already reached an agreement "on operating rules, cost recovery and conditions with a fairly large number of regions, not only in the Northwest Federal District." These regions include "the republic of Karelia, Komi Republic, Samara Region, Lipetsk Region, Krasnoyarsk Territory, Khanty Mansiisk Autonomous District and Saratov Region," Vinogradov added.
However, current regulations do not cover operating rules for small hydro plants on Russia's energy market, though "the base for this is defined" in the law on the electricity sector, Vinogradov said.
"We have already discussed these proposals and even articulations [for small hydro operating rules - ed.] with the Energy Ministry and the Federal Tariff Service and the government administration. There is essential understanding, but it will be difficult for us without your help," Vinogradov said, addressing Prime Minister Vladimir Putin, who attended the conference.
An Energy Ministry official who was also attending the conference said "there are currently no obstacles [to the development of a regulatory base - ed.] as such, we are in a regime of interdepartmental negotiations; I think that we will resolve this issue in a short period of time."
The development of the regulatory base will take about a month, the official said.
The government has repeatedly called for the development of renewable energy sources, which include small hydro plants, but the conditions under which such power generators would operate on the market have not been worked out.
Vinogradov also said that his company faces a number of difficulties in its business, including the lack of competitive Russian equipment. "We are currently holding negotiations with Czech companies on setting up joint assembly in Russia," he said.
Vinogradov also complained that Russian equipment makers approached by the company exhibit mistrust toward the start-up and refuse to work with Nord Hydro.
Commenting on this situation, Putin said: "I ask my colleagues from the Energy Ministry and Industry Ministry to look at this more closely."
The firm Nordenergomanagement is also investing in the Karelia projects discussed at the conference.
Based on information in the SPARK database, this company is owned by two businessmen, one of which is Mikhail Zavorovsky, a former manager at Unified Energy System and former head of St. Petersburg Distribution Company (PSK). While heading PSK, Zavorovsky was simultaneously general director of United Energy Distribution Company (OESK), which included another four retail companies, including Mosenergosbyt, the largest retailer on the Russian energy market.
Zavorovsky left OESK in August 2010 after the management company and its energy distributors were put under the trust management of Inter RAO UES, which subsequently acquired ownership of them. Zavorovsky left the company due to a conflict with the electricity supplier to Defense Ministry enterprises, Oboronenergosbyt, which OESK had planned to take over, according to Interfax's information.
Zavorovsky's firm LLC Trust owns 50% of Nordenergomanagement and the other 50% is held by CJSC Nordenergoinvest, the sole shareholder of which is Alexei Samsakov. Zavorovsky and Samsakov also equally own CJSC Rosoboronenergosbyt and LLC Oboronenergosnab, according to SPARK.
Nord Hydro was founded in 2007 to implement projects to develop and restore small hydro plants in Russia and other CIS countries. Nord Hydro, a management hydropower company, acts as contractor for the design, new construction and refurbishment of hydropower installations, and operates hydro plants. The company is actively involved in the legislative process and initiatives to support and develop small hydro generation.