Moscow, 27 February 2004. At its regular meeting held today, the Audit Committee reviewed the audited interim financial statements of RAO "UES of Russia" in accordance with the IAS for the first 9 months of 2003.

The Audit Committee members considered, together with the Company's management and its independent auditors (KPMG), the completeness of information disclosure about the operations of RAO "UES of Russia" in its audited financials. The RAO UES financial statements for the first 9 months of 2003 were disclosed on 18 February. It was stated that the management had been able to bring the procedure for and the completeness of disclosure of the Company's financial information into compliance with the recommendations of the Audit Committee. The Committee also noted with special satisfaction that the Auditor's Report prepared by KPMG contains acknowledgement of the receipt by the Auditors of all relevant information on the acquisition of assets in the Republic of Georgia. The Audit Committee found the management's decision to postpone the publication of the interim financials of RAO "UES of Russia" in accordance with the IAS justified, as such postponement was needed to ensure a full disclosure of information on the acquisition of certain assets in the Republic of Armenia.

At the same time, the Committee noted that the information disclosure on the Company's short-term borrowings remained insufficient. In view of the fact that the amounts borrowed and repaid by the Company over the first 9 months of 2003 were RUB123 billion and RUB121 billion, respectively (compared to RUB88.5 billion in both cases over the same period in 2002), the Audit Committee urged the management to disclose more information in the audited financials on the utilization of the Company's short-term borrowings and the structure of its short-term debt with respect to collateral, debt subordination, weighted average duration, cost of short-term borrowings, and the major lenders.

The Committee also approved the adjustments to its work plan for 2004 and the appointment of its representatives to sit on the Tender Committee to select RAO UES Auditors for 2004.