Moscow. 30 November 2007. The Board of Directors approved adjustments to the technique for the IPO and sale of shares in OAO "Volzhskaya TGC".*

On 25 May, the Board approved the offering of additional shares of Volzhskaya TGC, and on 31 August approved the sale of the "government stake" shares in the GenCo owned by RAO "UES of Russia"

The terms of the additional share offering previously approved by the Board of Directors and the terms of the share sale have not changed.

Volzhskaya TGC is authorized to issue up to 3,859,000,000 shares, which makes 14.78 percent of the company's capital before the offering and 12.87 percent of the capital after the offering). The company expects to raise RUB15 billion as a result of the transaction.

RAO "UES of Russia" will put up for sale its 36.93 percent stake of the capital before the offering, or 9,645,676,916 ordinary shares of the shares attributable to the "government stake".

The adjustments only affect the technique to be used for the share sale and offering. Initially, these processes were planned to occur concurrently. Now it has been decided that they will be separated in time: first the company will carry out its IPO, and then it will sell the "government stake" shares. Such separation in time will help maximize the proceeds from the IPO and share sale.

The additional shares are expected to be offered through open subscription to portfolio investors in about Q1 2008, and the "government stake" shares will be sold in Q2 2008 through a competitive process. The per share price at which the "government stake" shares will be sold will not be lower than the IPO price.

The Board approved the reduction in the Company's interest in OAO "Volzhskaya TGC" from 54.47 percent to at least 15.28 percent after the sale of the "government stake" shares.

 * On 1 July 2005, OAO "Volzhskaya TGC" was registered with the authorities and started operational activities on 1 January 2006. On 1 June 2007, the company completed to form its intended structure.

The Board of Directors approved the entry by RAO "UES of Russia" of preliminary agreements to sell the Treasury shares repurchased from shareholders.

Under Russian laws, RAO UES shareholders who voted at against the final phase of the Company's reorganization at its EGM of 26 October 2007 or did not take part in the vote are entitled to tender their shares for repurchase by RAO "UES of Russia". The Board of Directors on 27 July 2007 fixed the share repurchase price at RUB32.15 per ordinary share and RUB29.44 per preferred share based on the valuation report prepared by an independent appraiser, Deloitte & Touche.

To date, RAO "UES of Russia" has received some bids from potential investors interested in purchasing the shares which the Company has repurchased from shareholders.

However, until 10 December 2007, the closing date for receipt of bids for the Treasury shares, it is impossible to determine the essential terms of the share sale, which is why the potential investors will be asked to sign preliminary agreements.

As resolved by the Board of Directors, the price of RAO UES shares under such an agreement should be set at the weighted average price of such shares over the 3 weeks preceding the signature date, but not lower than the price at which they were repurchased from the shareholders. The share purchase agreements are to be completed not later than 1 June 2008.

The Management Board was instructed, after it reviews the shareholders' share repurchase requests, to submit at the Board meeting scheduled for December 2007 its proposals regarding the sale of the Treasury shares to potential investors.

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The Board of Directors approved the strategy for managing the temporarily idle cash received from the sale of its shares in the thermal WGCs and TGC owned by RAO "UES of Russia" and attributable to the government stakes. This strategy should help ensure that such funds are utilized in a most effective way.

The proceeds from the sale of the "government stake" shares in the WGCs and TGCs will be used to finance the investment programmes of Federal Grid Company and HydroWGC, which will remain under the government control after the RAO UES reorganization is completed.

As a result of the reorganization of RAO "UES of Russia", which is scheduled for 1 July 2008, the proceeds from the sale of the "government stake" shares will be transferred to the intermediate HoldCos, "State Holding" and "HydroWGC State Holding". Simultaneously with their spinoff, these two companies will merge with and into FGC and HydroWGc, respectively.

As these funds are expected to be received before the RAO UES reorganization is completed, the Board of Directors instructed the Management Board to formulate a strategy for managing the temporarily idle funds received from the sale of the "government stakes" in the thermal WGCs and TGCs.

Such strategy should, on the one hand, minimize the risks associated with investment, and on the other hand, reduce the deficit of funds needed to finance the investment programmes of FGC and HydroWGC.

In light of the global liquidity crisis, it appears advisable to formulate the least risky strategy in terms of income and timeframe of returning investments.

In this connection, the Board of Directors resolved that the temporarily idle cash received from the sale of the WGCs' and TGCs' "government stake" shares will be placed with banks which have long-term credit ratings not lower than the sovereign rating assigned by Standard & Poor's, Fitch Ratings or Moody's.

Under the strategy approved by the Board, the funds will be placed with banks on arm's length terms for periods matched with the respective time frames of the FGC and HydroWGC investment programmes.

The Board of Directors instructed the Management Board, together with the energy-related ministries, to look into the possibility and assess the advisability of extending the list of banks and using additional instruments for the investment of the Company's temporarily idle cash.

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The Board of Directors of RAO "UES of Russia" discussed the possible options for the offering of additional shares of OAO "WGC-6".*

On 8 February 2006, the Board of Directors approved the maximum number of ordinary shares that WGC-6 is authorized to issue at 1,850,000,000 shares (which makes 44.33 percent of the WGC-6 capital prior to the offering and 30.71 percent after the offering). The company expects to raise RUB41.6 billion which will be used to finance its expansion projects.

In today's resolution of the Board of Directors has added additional options to the WGC-6's offering programme.

First, WGC-6 may issue its additional shares in two phase. During the first phase (which may take place in Q4 2007 – Q1 2008), the company will issue as many additional shares as are necessary to finance its investment programme until 2009. During the second phase (Q4 2008 – Q1 2009), WGC-6 will issue further additional shares in order raise funds to finance its investment programme in full volume.

Second, if the additional shares are sold to a strategic investor, no limitation will be imposed on the amount of funds to be raised. Such a strategic investor taking part in the offering may acquire a blocking stake (25 percent plus one share) in WGC-6, with Gazprom preserving its controlling interest (50 percent plus one share), taking into account the results of reallocation of shares among shareholders in special purpose HoldCos and the state.

The WGC-6 is looking to raise capital to finance the construction of combined-cycle generators (PGU) at the existing power unit of the Kirishskaya TPP, capacity expansion of the Novocherkasskaya TPP (construction of a coal-fired power unit), expansion of the power unit by installing a gas turbine at the CHPP-24, and construction of the first start-up complex of the second phase of the Cherepovetskaya TPP project.

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The Board of Directors approved adjustments to the terms of sale of the TGC-9 shares held by RAO "UES of Russia" which are attributable to the government stake.

As resolved by the Board of Directors, the TGC-9 "government stake" shares held by RAO "UES of Russia" will be sold at a price of equal to the offering price, but not lower than RUB0.00801.

Such price corresponds to US$663 per kW of installed capacity.

TGC-9 shares are currently quoted at RUB0.0073 on the RTS and RUB0.0069 on the MICEX.