2 Dec 2010 18:33

RusHydro board approves contracts to supply capacity at new hydropower plants

MOSCOW. Dec 2 (Interfax) - The board of directors of RusHydro has given the go-ahead to conclude contracts with electricity wholesalers to supply capacity at the company's new hydropower plants (GES), including hydro-accumulation plants (GAES).

The contracts will be concluded on capacity included in the investment program list approved by the Market Council supervisory board.

The Market Council board approved the list, including nuclear and hydropower capacity, at the end of October. It includes seven hydropower facilities: two blocks at the Zaramagskykh GES, two blocks of the Zagorsk GAES, the Gotsatlinskaya and Kashkhatau GES and the Zelenchukskaya GES-GAES.

It also approved the model contract for provision of capacity.

The contracts for the nuclear and hydropower plants are quite similar to those covering investment obligations for thermal generation.

The capacity supply contracts are for 20 years. The fine for failing to meet investment commitments is 25% of the investment project.

The competitive capacity selection under the long-term market model began on October 18. Its results will be published on December 8.

The capacity market ensures that power company owners and investors carrying out capacity construction get a return on their fixed costs and capital investment. Variable costs are compensated with sale of electricity on the wholesale market.