Electrical Equipment Park in in Russian Federation Russian Federation on the basis of Korean technology Project’s conception presentation Moscow Region.

Electrical Equipment ParkElectrical Equipment Park in in

Russian FederationRussian Federationon the basis of Korean technology

Project’s conception presentation Moscow Region

The industrial land development concept masterminded by National Consulting in the Kolomna district of the Moscow region is aimed at meeting the current and future demand for modern, high quality equipment for the power transmission and distribution industry, required in pursuit of growth, reconstruction and modernisation of power grid; the project also seeks to support the government programme for import substitution to encourage domestic manufacturers and to attract foreign investors

This project involves creation of a major industrial park dedicated to production of high voltage electrical equipment, which appears to be the most scarce and predominantly imported including such products as transformers, HV cable fittings and HV cable, complete gas-insulated switchgears and gas-insulated circuit breakers; there is also potential to manufacture low and medium voltage equipment in the future

The industrial park is to be located on 125 hectares of land with advanced engineering and transport infrastructure, which features among others the M5 federal road, connection points of MOESK and Mosoblgaz, railway stations, river ports and local aerodromes

This project enjoys full administrative support at the federal and regional levels and assumes the participation of JSC UES FGC, JSC IDGC Holding, their subsidiaries, leading Korean electrical equipment manufacturers and the Management Company

Investment case concept

IDGC $3,3bln

FGC $2,2 bln

Others $1bln

$6,5 billion

The volume of the electrical equipment market in Russia is approximately $6.5 billion annually, which primarily relates to FGC

and IDGC’s investment programmes

Consumers of the electrical equipment

In the past few years, we have noted a steady increase in demand for electrical equipment. The main consumers of electrical equipment, in addition to electricity, are:

•In accordance with the base case scenario, in the long term electricity consumption will grow by approximately 2.2% per year

•Capacities will grow at a pace of 2% annually

•Market participants also highlight the stability of electricity demand

Industry growth and power grid expansion drive stable demand for electrical equipment

•A substantial share of equipment is obsolete and outdated

•Depreciation of electrical equipment of key consumers is 50-70%

•Substantial resources will be invested in equipment modernisation

Modernisation and renovation of outdated equipment is a major driver of demand for electrical equipment

•There is a current trend towards shifting the creation of value from imports to domestic production

•In light of the current import substitution programme, it is necessary to localise production in order to occupy the most advantageous positions in the market

Power grid expansion and equipment modernisation significantly depend on imports

FGC and IDGC significantly depend on imports: the share of imports in their annual consumption for certain substation

types is over 80%

Major segments of the electrical equipment market based upon attractiveness criteria

ProductsProducts

Participants of the ProjectParticipants of the Project

The preliminary The preliminary consent regarding consent regarding participation in the participation in the project have been project have been expressed by several expressed by several Korean companies.Korean companies.

The involvement of partners in the projectThe involvement of partners in the project

Kolomensky District. City of Kolomna. Location.

Area – 1091 skm (19-th position in the Moscow Region)

App. number of settlements – 150

Population – 188 400 (148 000 living in the city of Kolomna)

Location – 70km to 110km to the south-east from Moscow ring highway

Economy – industrial, agriculture and construction enterprises. Among majoir producers in Kolomensky district is the company BROEN – one of the world leaders in the production of stop and control valves for heating, water, gas, air-conditioning, refrigeration and industry.

Important – main engineering communications: gas pipelines Central Asia – Center, Saratov – Moscow, product pipeline Ryazan – Moscow, circled gas pipeline of the Moscow Region, high voltage transmission lines.

Transport – well developed road network. Federal Highway M5 on the territory of the district, 15 railway stations and platforms. River transport. 2 local (regional airports).

Kolomensky District. City of Kolomna. Numbers.

This presentation does not contain any financial This presentation does not contain any financial information dedicated to investment attractiveness, information dedicated to investment attractiveness,

which will be prepared as a separate document.which will be prepared as a separate document.

All the questions concerning participation in the project All the questions concerning participation in the project you can address toyou can address to

phone: +7 (495) 645-47-17phone: +7 (495) 645-47-17or email: [email protected] email: [email protected]

Thank you!