Annual report 2014

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Strategy in action

Strategic priorities of Lenenergo

Ensuring reliable, high-quality and affordable power supply of consumers, ensuring access of consumers to networks

Strategic objectives

  • Decrease in the indicator of specific breakdown rate
  • Reduction of average time of elimination of technological violations
  • Development and implementation of the repair program
  • Increase of serviceability of the equipment
  • Increase of availability of network infrastructure
  • Simplification of the procedure for technological connection
  • Increase of the level of service of consumers
  • Improve of the efficiency and manageability of the network

Results of 2014

Lenenergo ahead of schedule completed the task of the Agency of strategic initiatives to reduce the quantity of stages necessary for conclusion of technological connection contracts. The Company was first in Russia to introduce the project «8-800: 3 stages — 0 visits».

  • Lenenergo became the first company of Rosseti Group to create a new division —Situational and Analytical Center (SAC).
  • SAC’s work, implementation of large-scale programs on expansion of the routes of power lines, replacement of non-insulted wires with SIW, and upgrade of out-of-date grid equipment allowed the Company reducing the number of technological violations by 42% to 3,941 in 2014.
  • The quantity of accidents in networks 110 kV decreased by 35 % and average recovery time of power supply was 3 hours 23 minutes compared to 5 hours in 2013.
  • In 2014, Lenenergo repaired over 4,400 km of power lines, and the indicator of reduction of damaged cable lines reached its historical maximum — 197 versus 2,100 in 2010.
  • Experts cleared more than 3,700 hectares of routes of overhead transmission lines and performed a complex repair of 16 power sources and 1,762 transformer substations.
  • 21 cable lines of 6,110 kV with the length of 118 km were reconstructed.
  • The project of technical connection excluding visits to the grid company, 8-800, was launched.
  • In 2014, Lenenergo completed 14,767 contracts of Without connection of generating facilities (1 contract for 150 MW) and facilities connected under the temporary scheme.technological connection that two-fold exceeds the level of 2013.

Dynamics in 2010-2014

Indicator of specific accident rate (number of accidents per 1,000 conventional units of service), pcs.

Indicator of specific accident rate

Number of technological failures, pcs.

Number of technological failures

Average interruption duration, hours

Average interruption duration

Performance of the repair program, RUB mln

Performance of the repair program

Shaping and developing the grid infrastructure that meets the needs of the region of presence

Strategic objectives

  • Implementation of the investment program providing development of infrastructure
  • Arrangement of priorities for investments
  • Increase in safety of power supply
  • Provision of the principles of technological safety and labor protection
  • Maintenance of environmental safety
  • Implementation of the programs of renovation of the equipment
  • Implementation of the projects for networks development

Results of 2014

  • Implementation of the most innovative project of development of electric grids of Russia was started, that is developments of network 35 kV of the Petrograd District of St. Petersburg, enabling to solve the problem of wear of the equipment of substations of the historic downtown.
  • The project of connection to electric grids of a new railway branch Losevo — Kamennogorsk and railway station Kamennogorskaya with the allocated capacity of 158.6 MVA was launched.
  • Total installed capacity in 2014 amounted to 1,832 MVA, out of which 1,030.5 MVA was commissioned in St. Petersburg, and 801.5 MVA in the Leningrad Region. The Company upgraded 2,511 km of power lines, out of which 899 km in St. Petersburg and 1,612 km in the Leningrad Region.
  • Reconstruction of high-voltage lines 110 kV of Sosnovoborskaya-5 and Sosnovoborskaya-6 in extent of 29.9 km was completed in the Petrodvorets District of St. Petersburg.
  • Substation 35 kV #40 (with the input of transformer capacity of 25 MVA) was reconstructed in the Admiralty District of St. Petersburg.
  • Works on upgrade of substation 110 kV #514 Krasnoselskiy Paper Combine for ensuring technological connection of consumers in the Krasnoselskiy District came to the end.
  • Networks 35 kV near the City hospital #40 with the extent of 1.6 km were reconstructed to prevent negative electromagnetic impact on the work of modern diagnostic equipment in the new building of the hospital.
  • Two transformers of 63 MVA on the reconstructed substation 110/35/10 kV #48 Luga were commissioned in the Leningrad Region.
  • Two transformers of 126 MVA on substation 110/10 kV #526 Ford, providing Ford Plant with power supply were commissioned in the Vsevolozhsk area of the Leningrad Region.
  • Upgrade of substation 110/10 kV #318 Vozrozhdenie was complete in the Vyborg area.
  • Lenenergo provided technological connection of power unit #2 of Pravoberezhnaya HPP-5 in St. Petersburg for 150 MW.

Dynamics in 2010-2014

Input of power lines, km

Input of power lines



Input of transformer capacity, MVA

Input of transformer capacity

Maintaining a high level of operational, organizational and investment efficiency

Strategic objectives

  • Optimization of processes and systems
  • Labor productivity increase
  • Decrease in electricity losses
  • Loading of capacities
  • Increase of productivity and decrease in specific cost of investments
  • Decrease in OPEX
  • Reduction of investment expenses
  • Maintenance of a comfortable level of profitability of the primary activity

Results of 2014

  • The unique educational and training site — the training ground of Lenenergo in Tervolovo was open.
  • Implementation of the large-scale program on the update of special equipment in branches was started.
  • Creation of network control center was launched.
  • By the end of 2014, the effect of measures to reduce electricity losses amounted to 302 mln kWh in real terms and RUB 964 mln in monetary terms

Dynamics in 2010-2014

Effect of the implementation of measures aimed at reducing operating costs and generation of additional income, RUB mln

Effect of the implementation of measures aimed at reducing operating costs and generation of additional income

Effect of the implementation of measures aimed at reducing operating costs in technical re-equipment, reconstruction and Up to 2012, measures on this direction were not specified in the Program of costs managementnew construction, RUB mln

Effect of the implementation of measures aimed at reducing operating costs in technical re-equipment, reconstruction and new construction

Decrease in specific cost of construction

CL 110 kV (HV) — by 13% in 2014 compared to 2011 (in 2010 these measures were not implemented)

CL 3-10 kV — by 7% in 2014 compared to 2010

OTL 0.4 kV — by 50% in 2014 compared to 2010

Decrease in the cost of service per unit of grid equipment

By 9.1% compared to 2012

Within the development Strategy of the power grid complex of the Russian Federation approved by Resolution of the Government of the Russian Federation #511-R of 03.04.2013, it is necessary for the Company to perform the target indicator of decrease in operating costs by at least 15% by 2017 taking into account inflation concerning the level of 2012 per unit of service of grid equipment

Electricity losses in comparable conditions, %

Electricity losses in comparable conditions, %

Specific cost for organization of one commercial metering point, RUB thousand

Specific cost for organization of one commercial metering point

Quantity of commissioned commercial metering points, pcs.

Quantity of commissioned commercial metering points

Developing scientific and innovative potential of the Company, contributing to the innovative development of the electric power industry

Strategic objectives

  • Promotion of new technologies, innovative products and services
  • Formation of the innovative policy corresponding to the development strategy of the electric power industry
  • Implementation of R&D programs

Results of 2014

A number of innovative projects was implemented:

  • Lenenergo was the first in the Rosseti Group to launch development of its R&D program on creation of ferro-concrete poles from centrifuged partitioned racks for overhead lines 110 kV.
  • The program complex of mathematical modeling of electric modes, calculation of losses and currents of short circuit that raised reliability and quality of electricity transmission and distribution was introduced.
  • The Company installed more than 48,800 smart metering electricity devices in St. Petersburg and the Leningrad Region that enabled to cover 52% of electricity productive supply.
  • The Diagnostic center of Lenenergo which united the best diagnostic divisions of the Company was launched in a pilot format.
  • The first underground transformer substation was launched.
  • Implementation of SIW-technology (self-supporting insulated wire) was continued.
  • Implementation of the project of telemechanization of power plants, enabling to increase reliability and to reduce dependence on risks in the networks of external operators was continued.
  • The Company opened the first charging stations for electric vehicles.
  • In 2014, the corporate faculty of Lenenergo in St. Petersburg State Agrarian University trained two pilot groups of the Company’s employees. In 2015, the Youth innovative center of Lenenergo was open.

Dynamics in 2010-2014

Costs for implementation of the program of innovative development in the directions, RUB mln

Costs for implementation of the program of innovative development in the directions

Increasing investment appeal, strengthening of the Company’s image, improving communication with all stakeholders

Strategic objectives

  • Attracting new investors in the power grid complex
  • Implementation of the public borrowings program
  • Work with rating agencies
  • Implementation of effective dividend policy
  • Adherence to the principles of openness and transparency of business

Results of 2014

To increase interaction with its stakeholders and increase the investment appeal, in 2014 the Company continued to implement seven target communication programs:

  • Management of reliability — stable power supply system
  • Technological connection to networks. Reboot
  • Power construction — new energy of regions
  • Transparent company — investments into the future
  • Intellectual technologies — effective business processes
  • Lenenergo— traditions of leadership
  • Social responsibility — rules of modern business
  • To promote the project 8-800 for technological connection without visits to the client centers the section “Connect to networks without leaving home” was developed on the corporate website.
  • To expand the audience of information influence the Company created a corporate account on Instagram.
  • Against the backdrop of escalation of the situation in Ukraine, deterioration of macroeconomic indicators, a sharp drop in oil prices and devaluation of the national currency, on 23 December 2014 Moody’s put the credit ratings of Lenenergo and other 44 Russian non-financial organizations on review for downgrade. This decision was made following the lowering by Moody’s of the ceiling on non-sovereign ratings of the Russian Federation by one notch. However, stand-alone credit profile of Lenenergo has remained at the same level — Ba2 on the international scale. In March 2015, Moody’s confirmed the credit rating of Lenenergo at Ba2 (negative outlook).
In its activity Lenenergo traditionally strives to meet the interests of all parties (stakeholders) involved, including third-party network organizations, employees, consumers, public authorities and the investment community.