RusHydro Group announces its operating results for the 3Q and 9 months of 2014
JSC RusHydro (ticker symbol: MICEX-RTS, LSE: HYDR; OTCQX: RSHYY) announces operating results for the 3rd quarter and nine months of 2014 of its branches and the companies of RusHydro Group reflected in consolidated financial statements.
In the 3rd quarter of 2014, total electricity generation by power plants of RusHydro amounted to 25,660 GWh, a 9.7% decrease as compared to the same period of 2013, total power generation in the 9 months of 2014 amounted to 86,598 GWh (-7.3%). In the 3rd quarter of 2014, hydropower (HPPs) and pumped storage power plants (PSPPs) of RusHydro Group decreased electricity generation by 13.7% to 20,061 GWh, in the 9 months of 2014 - by 8.6% to 66,587 GWh, output by thermal (TPPs) and geothermal plants located in the Far East of Russia in the 3rd quarter of 2014 increased by 8.2% to 5,598 GWh, in the 9 months of 2014 output decreased by 2.9% to 20,011 GWh.
Electricity generation by the plants of RusHydro Group, GWh
The underlying factors of the production change in January-September 2014 were:
Center of Russia
Water inflow to reservoirs of the Volgo-Kama cascade from the beginning of 2014 was lower than long-run average. In the beginning of the spring flood the snow packs at the Upper Volga were close to its historical minimum, water storage in reservoirs of the Volgo-Kama cascade amounted to 26.5 km3 which is by 11 km3 lower than last year.
In September and the 3rd quarter of 2014, water inflow to reservoirs located on the Upper Volga was 35-55% of normal, water inflow to the Cheboksarskoe, Kuibyshevskoe, Kamskoe, Nizhnekamskoe reservoirs was close or slightly higher than normal.
Total water inflow to reservoirs of the Volgo-Kama cascade in the 3rd quarter of 2014 amounted to 32.9 km3 as compared to the average of 37.0 km3. In the nine months of 2014 water inflow amounted to 190.5 km3 as compared to the average of 219.3 km3. Water reserves in reservoirs of the Volgo-Kama cascade in the beginning of the 4th quarter amounted to 52.4 km3 which is 8.5% lower than long-run average.
Total electricity generation by RusHydro's hydropower plants of the Volgo-Kama cascade together with Zagorskaya pumped storage plant in the 3rd quarter of 2014 amounted to 8,466 GWh, a 0.6% increase as compared to the same period of 2013. In the 9 months of 2014, generation reached 30,554 GWh, which is by 6.5% lower than in the same period of the previous year.
South of Russia and North Caucasus
Water conditions on the rivers of the South of Russia and North Caucasus in the 9 months of 2014 were close or lower than the long-run average.
In the 1st quarter of 2014 water inflow to Dzaudzhikauskaya and Chirkeyskaya HPPs was close to normal. In the 2nd quarter of 2014 water inflow to Dzaudzhikauskaya and Chirkeyskaya HPPs was 20-30% lower normal.
In the 3rd quarter of 2014 water inflow to Krasnodarskoe reservoir on the Kuban' river and Chirkeyskaya HPP on the Sulak river was 20% lower than normal. Water inflow to Dzaudzhikauskaya HPPs in September was close to long-run average, in the 3rd quarter - 20% lower than normal.
The electricity generation by the hydropower plants of the South of Russia and North Caucasus in the 3rd quarter of 2014 decreased by 36.1% to 1,767 GWh, in the 9 months of 2014 - by 25.4% to 4,893 GWh.
In the 1st half of 2014, water inflow to major reservoirs of Siberia was close or slightly higher than long-run average. From May 31, 2014, due to increase in forecasted water inflows in the beginning of June the Novosibirskaya HPP has been releasing water through spillways which allowed to increase flood-control storage to carry flood water over during overflow in Altayskiy region.
In the 3rd quarter of 2014, water inflow to major reservoirs of Siberia was 20-60% lower than long-run average. Water inflow to the Sayano-Shushenskaya HPP in September was the lowest in the history of hydrological observations. In September, after flood period water inflow to Novosibirskoe reservoir was 20% lower than normal.
In the 3rd quarter of 2014 the Boguchanskaya hydropower plant increased electricity generation by 28.3% to 2,082 GWh as compared to the same period of 2013, in the 9 months of 2014 the plant generated 6,325 GWh as compared to 3,246 GWh generated in the same period of the previous year. In September 2014, two 333 MW hydropower units were commissioned and put into commercial operation at the Boguchanskaya hydropower plant. Total installed capacity of all units in operation now amounts to 2,667 MW. The launch of the last ninth hydropower unit of the plant is scheduled for the end of 2014. In the beginning of October the plant's reservoir level decreased from 203.18 m to 203.03 m (design reservoir level is 208 m).
Total electricity generation by RusHydro's Siberian hydropower plants in the 3rd quarter of 2014 decreased by 24.7% to 5,920 GWh, in the 9 months of 2014 - by 12.5% to 17,861 GWh.
Water level during flood period in 2014 in the Far East of Russia was low. Total water inflow to reservoirs of the Zeyskaya and Bureyskaya HPPs in the 3rd quarter of 2014 amounted to 23.3 km3 which is 2x less than in the same period of 2013. In the 3rd quarter of 2014, water inflow to the Kolymskaya HPP was 1.8x higher than normal, due to rainfalls.
In the 2nd and 3rd quarter of 2014 Magadan region experienced intensive floods. The average water inflow to hydropower plants of RusHydro located on the Kolyma river amounted to 3100 m3/s, which is almost twice as high as normal level of 1740 m3/s. The main reason for high water inflow was intensive snow melting as well as heavy rains in the region. In September, the Kolymskaya HPP had been releasing water through spillways to provide for navigable water level on the Kolyma river. Currently, all Far eastern hydropower plants are experiencing a substantial lowering of water inflows due to subzero temperatures, all plants are operating normally.
The total electricity generated by hydro and geothermal power plants of the Far East in the 3rd quarter decreased by 8.3% to 3,535 GWh. In the 9 months of 2014, the generation increased by 1.1% to 11,782 GWh.
In the 3rd quarter of 2014, the generating assets of RAO ES of the East, a subsidiary of RusHydro, produced 5,792 GWh of electricity, an 8.4% increase as compared to the 3rd quarter of 2013. In the 9 months of 2014, the generation decreased by 2.8% to 21,075 GWh. Of this total, 74% (15,525 GWh) was generated by Far East Generating Company, which decreased production by 2.9% as compared to the last year, mainly due to increased capacity of hydropower plants, decrease in export of electricity by 3.7% and electricity consumption by 0.8% as compared to the same period of 2013. In the nine months of 2014, electricity generation by companies operating in isolated energy systems of the Far East amounted to 5,311 GWh, which is by 1.2% lower than in the previous year.
In the 9 months of 2014, heat output by thermal plants of RAO ES of the East decreased by 5% to 20,086 thousand GCal as compared to the same period of 2013.
In the 3rd quarter of 2014, electricity generation by the Sevan-Hrazdan cascade of hydropower plants in Armenia increased by 5.9% to 179 GWh, in the 9 months of 2014, electricity generation decreased by 1.8% to 434 GWh. The power generation by the plants of the cascade is dependent on water inflows of Hrazdan river and water releases from lake Sevan.
In the 3rd quarter of 2014, total electricity output by RusHydro's four retail companies, operating in Bashkiria, Chuvashia, Ryazan and Krasnoyarsk regions, amounted to 7 776 GWh, a 0.7% increase as compared to the same period of 2013. In the 9 months 2014, RusHydro's electricity retail companies have decreased output by 7.9% to 26,946 GWh.
Water inflows forecast
According to the forecast of the Hydrometeorologic Center of Russia, the following dynamics of water inflows to the major reservoirs is expected in the 4th quarter of 2014:
[i] The Boguchanskaya hydropower plant is part of the Boguchanskiy Energy and Metals Complex (BEMO), a 50/50 joint venture (JV) between RusHydro and UC RUSAL, and is not part of RusHydro Group. According to RusHydro’s shareholding in the JV (50%), the results of the plant are reported in the official financial statements in “Share of results of associates and jointly controlled entities”. Operations of the HPP have been put into the press-release for general reference.
[ii] Includes generation by HPPs of JSC RusHydro, Kolymskaya HPP and Viluiskie HPPs, part of RAO ES of East group.
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.