Moscow. 13 October 2004. The Enterprises of RAO "UES of Russia" are making preparations for the 2004/2005 autumn-winter period largely according to schedule.

As at 1 October 2004, the fuel inventories accumulated by entities of RAO "UES of Russia" amounted to 17,696,100 tonnes of coal (108.5% of the target) and 2,972,400 tonnes of fuel oil (109.9%).

The fuel supplies in the energy systems that caused serious concerns in the previous years in that respect, are also in excess of the approved targets: "Khabarovskenergo" – 1,005,100 tons of coal (102.6%) and 84,100 tons of fuel oil (127.4%), "Sakhalinenergo" – 100,400 tons of coal (100.4%) and 3,100 tons of fuel oil (103.3%), "Kamchatskenergo" – 50,100 tons of fuel oil (100.2%), "Dalenergo" – 431,700 tons of coal (100.4%) and 17,500 tons of fuel oil (102.9%).

At the same time, because of consumer non-payments, fuel supply problems are experienced by OAO "Ulyanovskenergo", where the fuel oil inventories stand at 4% of the target, OAO "Buryatenergo" (82% of the target for coal), and OAO "Eksperimentalnaya TPP" (26% of the target for coal).

Pursuant to the order of the Chairman of the Management Board of RAO "UES of Russia" Anatoly Chubais, on 1 September 2004 all companies of RAO "UES of Russia" formed commissions to assess the energy companies' preparedness for work during the autumn-winter period of 2004/2005. All entities under inspection are to receive their winter preparedness certificates. The key condition for obtaining a winter preparedness certificate is availability of the standard inventory of fuels and absence of restrictions on the working capacity for power plants and electricity transmission restrictions during peak load periods. In the past three years, all companies of RAO "UES of Russia" have been able to obtain winter preparedness certificates in due time and ensured reliable and uninterrupted power supply to consumers throughout the autumn/winter period.

At the same time, stable work of RAO UES entities during the autumn-winter peak directly depends on customers' payments for electricity and heat, as the regional energos are to ensure constant purchases of fuel and timely fulfil their obligations on the loans received for that purpose. In this connection, RAO "UES of Russia" would like to point to the unsatisfactory performance of payment obligations by the residential utilities entities, which are large power consumers.

As at 1 October 2004, residential utilities enterprises account for over one third of the total debts owed to RAO "UES of Russia" (RUB25.5 billion).

The situation is most serious with the utilities debts to OAO "Kamchatskenergo" (RUB1 billion), OAO "Buryatenergo" (RUB543 million), OAO "Kostromaenergo" (RUB427.8 million), and OAO Ulyanovskenergo (RUB4.1 billion).

There are serious concerns about the technical preparedness for winter in the residential utilities sector in some regions, particularly in the Republic of Tyva, Magadan Region, Sakhalinskaya Region, Kamchatskaya Region, and Ulyanovsk Region. As utility enterprises account for the bulk of heat supplies to Russia's consumers, RAO "UES of Russia" shares the concern of the Ministry of Emergencies (MChS) that the unsatisfactory state of municipal boiler houses and heat mains may result in interruptions of heat supply during the autumn-winter period, despite the high degree of winter readiness at the energy companies.