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RusHydro has finished construction of the first stage of Zagorskaya pumped storage plant

JSC RusHydro (ticker symbol: RTS, MICEX, LSE: HYDR; OTCQX: RSHYY) completed operational tests of the first stage of Zagorskaya pumped storage plant No. 2.

The tests confirmed that all equipment of the plant works properly. According to the schedule the temporary dam in the lower basin of the plant will be demolished in March 2013 and the equipment will be tested in all operating modes (pump, turbine and synchronous condenser).

The launch of the plant in commercial operation will follow the commissioning of a 500 kV double-circuit high-voltage line by FSK EES, the plant will operate on the temporary basis until the network facility is launched.

The construction of the plant is implemented within a power delivery contract, which provides for the right of the supplier to postpone the start of power delivery up to 12 months without any penalty. Earlier RusHydro notified the System Operator and the Market Council that it may change the date of launch of the first two hydro-units of Zagorskaya pumped storage No. 2 (420 MW) from January 1, 2013, to January 1, 2014. RusHydro is now examining the ways to compensate the losses incurred by non-availability of transmission capacity of Federal Grid Company (FGC) and will undertake all the necessary measures mitigate the financial fallout.

The Zagorskaya pumped storage plant No. 2 is being constructed nearby operative Zagorskaya pumped storage plant. The construction is organized by JSC Zagorskaya pumped storage plant No. 2 100% subsidiary of RusHydro, formed in 2006.

The information in this press release may contain projections or other forward-looking statements regarding future events or the future financial performance of RusHydro. You can identify forward looking statements by terms such as "expect," "believe," "anticipate," "estimate," "intend," "will," "could," "may" or "might," the negative of such terms or other similar expressions. We wish to caution you that these statements are only predictions and that actual events or results may differ materially from these statements. We do not intend to update these statements to reflect events and circumstances occurring after the date hereof or to reflect the occurrence of unanticipated events. Many factors could cause the actual results to differ materially from those contained in our projections or forward-looking statements, including, among others, general economic conditions, our competitive environment, risks associated with operating in Russia, rapid technological and market change in our industries, as well as many other risks specifically related to RusHydro and its operations.
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