Foreign Assets

Description of business [EU1,2,4]
Country Asset Specialization
Power plants Installed electric power capacity Installed thermal power capacity Electricity generation in 2019, mln kWh Heat output in 2019, thousand Gcal Share of generation in country, %
Georgia JSC Khrami HPP-I Hydroelectric power plant 113 442 3.7%
JSC Khrami HPP-II Hydroelectric power plant 114
Pridnestrovian Moldavian Republic CJSC Moldavskaya TPP Thermal power plant 2,520 166 4,244 102 89.3%
Turkish Republic Trakya Elektrik Uretim Ve Ticaret A.SThe plant was returned to the Turkish state company EUAS on June 5, 2019 under a Concession Agreement. Thermal power plant 478 2 negligible
Kazakhstan Ekibastuzskaya TPP 2 The financial results of JSC Ekibastuzskaya TPP-2 are not included in the Group’s financial results due to the reclassification of a 50% stake in JSC Ekibastuzskaya TPP- 2 to assets classified as held-for-sale in December 2016. The operating results of JSC Ekibastuzskaya TPP-2 are included in the Group’s operating results 100% up to December 2019 inclusive. A transaction to sell the 50% stake in JSC Ekibastuzskaya TPP-2 was completed in the fourth quarter of 2019. Thermal power plant 1,000 514 4,929 83
Lithuania Vydmantai Wind Park UABA subsidiary of AB INTER RAO Lietuva, which is part of the ‘Trading in the Russian Federation and Europe’ segment. Wind farm 30 65 2.1%
Network assets Length of networks Electricity sales in 2019, mln kWh Market share in country, %
Georgia JSC Telasi Distribution Grid 5,887 km

OL 2,316 kmOL – overhead power transmission lines with voltage ranging from 5 volts or less to 110 kV.

CL 3,571 kmCL – cable power transmission lines ranging from 5 volts or less to 35 kV.
2,747 20.7%
JSC Khrami HPP-I and JSC Khrami HPP-II

JSC Khrami HPP-I and JSC Khrami HPP-II form a cascade of hydroelectric power plants on the Khrami River. Annually they produce more than 3% of all electricity produced in Georgia. The total installed capacity of the two hydroelectric power plants is 227.2 MW. The electricity is sold under contracts with JSC Telasi.

JSC Telasi

JSC Telasi is the largest power grid and retail company in Georgia and employs 2,066 people. Its main activities include the purchase and sale of electricity, maintenance and operation of power networks, electricity transit services, maintenance services for subscribers, and the administration of a unified integrated and coordinated system for the supply of electricity and water as well as water treatment in Tbilisi. JSC Telasi purchases electricity (capacity) on the wholesale power (capacity) market and also under direct contracts with electricity producers in order to serve consumers in Tbilisi and nearby villages.

Total length of JSC Telasi power lines, km [EU4]
Length of power lines, including 5,886.9
Overhead power lines (in chains), total 2,316.1
110 kV voltage 249.6
35 kV voltage 88.8
10 kV voltage 112.9
6 kV voltage 196.8
500 volts or less 1,668
Cable power lines, total 3,570.8
35 kV voltage 101.5
10 kV voltage 331.3
6 kV voltage 1,382.7
500 volts or less 1,755.4
CJSC Moldavskaya TPP

CJSC Moldavskaya TPP is one of the largest thermal power plants of this type on the European continent and provides electricity to Transnistria and Moldavia. As a generating unit, the Moldavia TPP is an integral part of the unified energy system of Moldavia and Ukraine. Its open switchgears play a crucial role in the transmission of electricity for Moldovan consumers and potential transmission to EU countries.

Turkey

The Inter RAO Group operated the Trakya Elektrik thermal power plant with installed capacity of 478 MW until June 2019. On June 5, 2019 (upon expiration of the initial period for the management of Trakya Elektrik in accordance with the Concession Agreement dated May 28, 1993 and the Protocol on Amendments to the Concession Agreement dated February 16, 1996), the plant was returned to the Turkish state company EUAS as the authorized organization.

Vydmantai Wind Park UAB

The 30 MW wind farm is one of the largest in the Baltic states. Fifteen E 70 model wind power plants with installed capacity of 2 MW each produce electric power in the wind farm. In 2019, the wind park produced 65.00 GWh of electricity. In 2018, production amounted to 50 GWh. The park was included in the segment of transmission networks of Lithuania’s Palanga-Sventoji energy system with capacity of 110 kW.

Results of operating activities [EU4 12, 28, 29]
Georgia

The installed electric power capacity of generating assets remained unchanged in the reporting period at 227.2 MW. Total electricity production decreased by 12.5% in 2019 due to a lower level of inflow water balance.

In 2019, the net supply of purchased electricity by JSC Telasi was 2.6% lower than the previous year’s level due to reduced consumption in the commercial sector after a major consumer switched to direct consumption from the Georgian wholesale market on May 1, 2018. Organizational, technical, and repair work helped to keep electricity losses in networks at the level of 5.38%, which is below the standard level; taking into account transit, standard losses amount to 5.85% from September 1, 2018 (5.27% prior to May 1, 2018 and 5.88% from May 1, 2018 to August 31, 2018). The total length of power lines increased by 4.6% to 5,887 km [EU4] due to the construction of lines for new consumers and new cable lines for network protection as well as the reconstruction and modernization of networks.

Reliable funding ensures the success of international projects

Risk appetite: Inter RAO does not implement international projects without state support or confirmed funding sources.

Moldavia

The installed electric power capacity CJSC Moldavskaya TPP remained unchanged in the reporting period. The total amount of electricity generated in 2019 increased by 8.0% compared with the previous year and amounted to 4.244 bln kWh (89.3% of total electricity generation in the country), which can be attributed to an increase in electricity output for export to Moldavia and growing demand for electricity from consumers on the domestic market of the Pridnestrovian Moldavskaya Republic. The installed capacity utilization factor increased by 1.4 percentage points compared with 2018, while the specific fuel consumption for the supply of electricity from busbars remained at virtually the same level as in 2018. The main type of fuel used in 2019 was natural gas, which made up 99.9% in the plant’s fuel balance.

Turkey

Trakya Elektrik A.S. generated 2 mln kWh of energy in 2019, which is 99.7% lower than the production volume in 2018. The decrease in generation in the reporting period is due to the electric load dispatch schedule set by the system operator.

Operating indicators of the JSC Telasi power grid [EU12, 28, 29]
Operating indicators of the JSC Telasi power grid [EU12, 28, 29]
Financial results by segment
Indicator ‘Foreign Assets’ segment
2017 2018 2019 2018/2019
Revenue, RUB mln 26,762 26,817 24,011 –10.5%
Share in Revenue of Inter RAO Group,% 3% 3% 2% –1 p.p.
Operating expenses, including
Purchased electricity and capacity, RUB mln –5,448 –6,607 –5,668 –14.2%
Electricity transmission fees, RUB mln –1,060 –1,779 –1,714 –3.7%
Fuel expenses, RUB mln –9,929 –6,456 –5,706 –11.6%
EBITDA, RUB mln 6,082 7,491 7,060 –5.8%
EBITDA margin, % 23% 28% 29% 1 p.p.
Share in EBITDA of Inter RAO Group, % 6% 6% 5% –1 p.p.

Revenue in the ‘Foreign Assets’ segment decreased by RUB 2.806 bln (–10.5%) in the reporting period. The main reasons for the decline were:

  • A decrease in the Georgia sub-segment’s revenue by RUB 1.753 mln (–13.9%) due to lower supplies of electricity to the commercial sector, the fact that a major consumer of JSC Telasi switched to direct purchases of electricity on the Georgian wholesale market as well as a lack of sales to external counterparties for JSC Khramhesi HPP-I and JSC Khramhesi HPP-II in 2019
  • An increase in the Moldavia sub-segment’s revenue by RUB 1.901 bln (22.4%) due to an increase in the total supply of electricity, growth in the supply tariff to Moldavia as well as the effect of the devaluation of the Pridnestrovian ruble versus the US dollar
  • A decrease in revenue from the sale of electricity (capacity) in the Turkey sub-segment by RUB 2.954 bln (-51.5%) due to a decrease in paid contracted capacity in 2019 and the number of days paid (155 days in 2019 versus 273 days in 2018) and the electric load dispatch schedule set by the system operator

JSC Telasi’s operations are heavily tied to purchased electricity and capacity and transmission fees. The reduction in expenses is due to the decreased volume of purchased energy and the influence of changes in the lari’s exchange rate versus the ruble.

Fuel expenses in the Moldavia sub-segment grew by RUB 1.405 bln (32.8%) due to an increase in the fuel component as regards gas as a result of more exports to Moldavia. In 2019, fuel oil was used as a reserve fuel during the repair of gas distribution plants and the commissioning of units. Fuel expenses in the Turkey sub-segment decreased by RUB 2.155 bln (99%) due to a negligible amount of electricity generation.

EDITDA in the segment declined primarily due to a decrease in EBITDA of the Georgia sub-segment by RUB 630 mln. JSC Telasi (at which EBITDA decreased by RUB 481 mln) showed marginal profit fall due to an increase in the weighted average tariff for purchased electricity combined with a reduction in the average tariff for electricity sales and the volume of electricity sales. Generating assets (JSC Khramhesi HPP-I, at which EBITDA decreased by RUB 41 mln, and JSC Khramhesi HPP-II, at which recorded a RUB 108 mln decrease) showed marginal profit decrease due to a decrease in electricity sales resulting from the deterioration of the water balance in 2019 compared with 2018. EBITDA in the Moldavia sub-segment increased by RUB 332 mln (11.8%) primarily due to growth in marginal profit as well as the devaluation of the Pridnestrovian ruble. Reduced revenue factors decreased EBITDA in the Turkey sub-segment by RUB 133 mln (–5.4%).