Presentation by Anatoly Chubais Chief Executive Officer RAO «UES of Russia» to the 18th World Energy Congress (round table) Buenos Aires.

Presentation by Anatoly Chubais

Chief Executive OfficerRAO «UES of Russia»

to the 18th World Energy Congress

(round table)

Buenos Aires

2

668,000 employees

623 bn kWh of electricity generated - 72% of Russia’s total

generation

2.7 mn km of power

transmission lines - 96 % of Russia’s

total length

407 thermal and hydropower plants with installed capacity of

156,000 MW

RAO «UES of Russia» in the country’s energy sector

3

Modern business procedures

International audit

Corporate governanceInternational

accounting standards

BudgetingBusiness planning Бизнес-

планиро-вание

Separate accounting

New management - three years’ positive performance

4

Payment in cash, %

0

20

40

60

80

100

120

Q198

Q298

Q398

Q498

Q199

Q299

Q399

Q499

Q100

Q200

Q300

Q400

Q101

Q201

Q301

112

Significant increase in cash collection

Supply management: solving the non-payment problem

17 22

48

92

101

New management - three years’ positive performance

5

Investments increased

*) All 1999 figures are adjusted for the Rouble purchasing power as of 12/31/2000

Compared with 1999, cash

investments in 2000 grew by the factor

of 4.5 - from RUR 2.0 bn to RUR 9.2

bn, for 2001 investments are

estimated at RUR 11 bn

RUR bn

2.0

9.2

0

10

1999 2000 2001

11.0

New management - three years’ positive performance

6

Third year of international audit by PricewaterhouseCoopers: profit based on 2000 year results

*) All 1998 and 1999 figures are adjusted for the Rouble purchasing power as of 12/31/2000

-100

20 1998 1999 2000

-80

-60

-40

-20

0

7.9- 28.2

- 91.3

Operating profit of the Group, RUR bn

* 1998 reports reflected the loss from

economic ageing which affected the

Group’s performance

In 2000 the Group for the first time posted an operating profit of RUR 7.9 bn and net profit of RUR 0.5 bn.

Net profit of the Group, RUR bn

-500

-100

0

100

- 11.9

- 532.3

1998 1999

0.5

2000

New management - three years’ positive performance

7

Changing the power sector structure with transition to the market

2001 2006-2008

Generation

LV Grid

Supply

RAO «UES of Russia»

holding

CDU

Regional energos

HV Grid

Power plants

Independent generating company

Independent generating company

Independent generating company

Independent generating company

HV

Grid

LV

Grid

LV

Grid

LV

Grid

LV

Grid

Consumers

8

Short-term investment program of RAO «UES of Russia»

230.0 450gas

Baltic states32.5 215gas

Europe437.0 900gas

investment, US$ mn fuel type capacity to be installed, MW export capabilities

Kaliningrad co-gen plant-2

Surgut thermal plantKrasnodar co-gen plant

Upper Volga hydroplant

cascade

Ivanovo thermal plant

Dzerzhinsk co-gen plant

Schekino co-gen plant

North-Western co-gen plantPskov thermal plant

31.2 195hydro

273.6 gas

37.6 150gas

275.8 900gas

177.7 345gas

Turkey166.8 474gas

Berezov thermal plant-1

113.5 700coal

Scandinavia

Japan9600 4000gas

Sakhalin thermal plant

9

In accordance with economic growth forecasts by

2010 power consumption level shall grow by 20-35%

Long-term investment capabilities: generating companies

DeregulationState regulation Competitive market

100

150

200

250

2000 2003 2010

Capacity requirements

Capacity adjusted for resource exhaustion

bn kWh

191

246

Free market share in power generation

Necessary investments - over

US$ 35 bn

196

214