OJSC Kubanenergo
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Priority Development Areas

The work of OJSC Kubanenergo is divided into a number of areas that are priorities in accordance with the relevant currently valid resolutions of the Board of Directors.

Business area

Date and number of the OJSC Kubanenergo Board of Directors resolution which defines the priority activity

Company actions in the priority area

1.

Ensuring the set level of reliability and quality of services provided in accordance with normative legal acts  

21.11.2011, Minutes №121/2011

In accordance with the Government Decree of the Russian Federation dated 31.12.2009 № 1220 “On setting target levels of reliability and quality of goods and services used in establishing long-term tariffs”, the REC - DPT KT annually establishes the target levels of reliability and service quality for the Company. This is an integrated index made ​​up of levels of reliability and quality for electricity transmission services and technological connections.
During the reporting year, the Company achieved the planned target level of reliability and quality of services provided.
In order to satisfy the necessary level of reliability, a number of measures to improve reliability were implemented.
(For more information, see the section Results of Operating Activities / Ensuring Quality, Reliable and Uninterrupted Electric Power Supply to Consumers)

2.

Fulfilling the Program for
Construction of Olympic Facilities and Development of Sochi as an Alpine Climatic Resort

Resolution of the Russian Government  dated 29.12.2007 № 991

In the reporting year, as part of the Program for Construction of Olympic Facilities, three new 110 kV substation were built and two existing substations were upgraded, resulting in a total increase in transformer capacity of 308 MW.
In addition, there was reconstruction and construction of new 110 kV lines with multifaceted supports, as a result of which 715 supports were installed. AERO-Z type lines were installed for a length of 900.8 km, while at sites in security zones of individual dwellings there was installation of 110 kV cable lines for a length of 36.2 km. The total length of 110 kV lines was 155 kilometers. In particular, under implementation of 452 projects of the urban distribution network, construction and reconstruction of overhead transmission lines as well as transformer substations and distribution points was carried out. As a result of project implementation, 43 distribution points, 390 transformer substations, and 4,942 supports were installed, and 2,300 kilometers of cable were laid.
In the village of Krasnaya Polyana, a new production base for services was built, providing the necessary working conditions of operating personnel, and new equipment was installed for a new operational dispatching service with a 6-10 kV dispatcher panel using video cubes for the organization of operational control circuitry power of the village.
In 2014, the Company made arrangements for corporate procedures on the conclusion of additional agreements with contractors to carry out, in line with the positive conclusion of state examinations of statements of the contract price, and approved the relevant acts of acceptance.
In 2014, all of the facilities of OJSC Kubanenergo included in the Program for Construction of Olympic Facilities and Development of Sochi as an Alpine Resort, approved by Decree of the Russian Government dated 29.12.2007 №991, were put into operation.   
(For more information, see the section Investment Activity/ Construction and reconstruction of Olympic Venues)

3. 

Fulfilling the Company Strategy in the field of information technology, automation and telecommunications for the period to 2016

20.06.2012, Minutes №138/2012

See the sections Results of Operating Activities / Development of Corporate and Technological Automated Control Systems 

4. 

Fulfilling the Company’s Environmental Protection Policy for 2008-2015

18.01.2008, Minutes
№ 49/2008

See the sections Sustainable Development / Environmental Protection Policy

5.

Increasing the level of anti-terrorist and anti-sabotage protection of the Company’s electric grid facilities

05.08.2010, Minutes №94/2010

See the sections Results of Operating Activities / Ensuring Safety of Company Facilities

6. 

Planning the development of the OJSC Kubanenergo distribution grid complex

07.09.2011, Minutes №116/2011

For the purposes of this decision, the Company Board of Directors carries out a set of measures for long-term planning electric grid development:

  • direct involvement in the development of Schemes and Programs of perspective development of the electric power industry of the Krasnodar Territory for the period until 2019;
  • preparation of proposals for the inclusion of measures for the construction of new and reconstruction of existing power facilities in the Schemes and Programs for Development of the Electric Power Industry in the Krasnodar Territory and the Republic of Adygea for the period up to 2020;
  • participation in development of programs for integrated development of communal infrastructure of 44 municipalities of the Krasnodar region for the period of 2012 – 2020.
7. 

Consolidating power grid assets

21.11.2011, Minutes №121/2011

In order to increase its share in the market of power grid services and reduce the number of territorial grid companies in the region served by OJSC Kubanenergo, the Board of Directors of the Company approved a long term Program for Consolidation of Power Grid Assets for 2011-2015.
The objective of this Program is the acquisition of ownership or use of network assets not controlled by OJSC Kubanenergo. Implementation of the program should contribute to improving the reliability of the power supply and controlling electrical networks.
In 2014, the main methods of consolidation were rental, and free transfer from municipal administrations, non-profit organizations, and individuals.
Thus:
- using the rent method of consolidation: 1,107 conventional units were consolidated with a length of 457 km and a capacity of 33 megawatts;
- using the "free transfer" process of consolidation: 40 conventional units were consolidated, with a length of 39 km and a capacity of 4 megawatts.
The consolidation of power grid assets in 2015 will be implemented in accordance with the approved investment program.

8. 

Construction and operation of fiber-optic communication lines

03.05.2012, Minutes №133/2012

See the sections Results of Operating Activities / Development of Corporate and Technological Automated Control Systems 

9. 

Implementation of the Company’s production asset management system

15.06.2012, Minutes №137/2012

In 2014, a number of activities were fulfilled aimed at developing the production asset management system, namely:
- data on equipment and customers of the main and the distribution network was updated in the automated control system of power supply equipment certification on the platform of 1S.Energetika;
- indices of the status and consequences of failure of electric grid equipment were calculated;
- proposals were formed and corrected for adjusting the production program of OJSC Kubanenergo for 2015 based on the results of calculation of the index of status and consequences of failure of the electric grid equipment of OJSC Kubanenergo;
- work tasks for the development of the production assets management system of OJSC Kubanenergo were determined in terms of extending the functionality of the production asset management system;
- the results of the functioning of the management system of production assets of OJSC Kubanenergo were audited.
Work on development of the functionality of the production asset management system is planned for 2015-2016, including:
- expanding the capabilities of the automated system in terms of enhancing the convenience of its use (implementation of taking out a batch of defects, the possibility of mass input of weighting coefficients in the types of institutional facilities (branch, RES, substation service, substations, etc.) to calculate the index of the state of institutional facilities, etc.);
- implementation of adjustment of formulas for evaluating the technical condition of the equipment;
- calculation and display of the need for action to be taken on equipment;
- formation of prioritized lists of equipment;
- formation of corporate and industry reports;
- automation of the process of calculating the volume of service in units of enterprises engaged in operation of electric grid facilities;
- automation of the planning process and consideration of implementation of measures of maintenance and repair of industrial assets;
- synchronization of the content of directories of classifiers of the automated system with directories of the centralized management system of classifications of JSC Russian Grids.

10. 

Certification of equipment, materials, and systems at the Company’s facilities

04.06.2014, Minutes №190/2014

In order to organize work in OJSC Kubanenergo for the certification of equipment, materials and systems, an order was issued, under which:
•   the "Methodology of certification of equipment, materials and systems for the power industry" and "The procedure for certification of equipment, materials and systems for the power industry" were enacted as internal documents
•   a committee for the acceptance of equipment, materials and systems of OJSC Kubanenergo was designated, and the Regulations for the Work of the Commission on the Acceptance of Equipment, Materials and Systems of OJSC Kubanenergo were approved.
In 2014, no applications were submitted in the prescribed manner for consideration by the Commission on the need to make certification of equipment, materials and systems in the power grid complex of OJSC Kubanenergo.

11. 

Ensuring the accessibility of energy infrastructure and the quality of technological connection to Company power grids

12.09.2014, Minutes №196/2014

In 2014:

  • the possibility of making applications for technological connections to electricity grids using the Company website was implemented,
  • the possibility of making a preliminary calculation of the price of technological connection using the client’s own parameters was implemented on the Company website,
  • information on the overall electricity capacity of each section of the electric grid, and the current capacity reserves for connecting consumers, is published.

The Company is planning to reduce the normative time periods needed for implementing technological connection for special categories of applicants, as well as to reduce the cost of technological connection to the Company’s electric grids in 2015.

12.

Improving the system of internal control and risk management, and development of the internal audit function

12.09.2014, Minutes №196/2014

By Resolution of the Board of Directors of JSC Russian Grids (minutes dated 13.02.2014 №143), the Strategy for Development and Improvement of the System of Internal Control of JSC Russian Grids and its subsidiary companies (hereinafter – the Strategy) was approved.
In order to fulfill the Strategy, for development and improvement of the system of internal control and management of risks, and functions of internal audit, the Board of Directors of the Company determined the development and improvement of the system of internal control and management of risks, and functions of internal audit, as a priority direction of its business activity (minutes dated 12.09.2014 №196/2014) and approved:

  • The Policy of Internal Control in its new edition;
  • The Policy of Risk Management in its new edition;
  • The Policy of Internal Audit.

Work was done in 2014 on identifying the Company’s risks, and the risks found were grouped into registers of:

  • Key operational risks;
  • Operational risks of main business processes;
  • Operational risks of other business processes.

An estimate of the consequences of the risks discovered is updated quarterly, and actions at managing these risks are updated and fulfilled.
Information about Company risks is given for examination and decision making to:

  • The Company Management Board – quarterly;
  • The Audit Committee of the Board of Directors – on half year results and end of the year results;
  • The Board of Directors – on end of the year results.

In order to increase the predictability of fulfillment of the Company’s business plan and development of success at fulfilling the key performance indicators in the reporting period, the Company began integration of the system of risk management and the system of business planning.
The Department of Internal Audit and Control of the Company conducts a yearly appraisal of the effectiveness of the system of internal audit and risk management, the results of which are provided to the Board of Directors (with a preliminary conclusion on appraisal by the Audit Committee of the Board of Directors).
With the aim of fulfilling the Strategy, in terms of division of functions of fulfilling preventative and current control (building SIC) with functions of further control (appraisal of the effectiveness of SIC), for the purpose of ensuring a rational level of independence and objectiveness, in accordance with the Resolution of the Company Board of Directors, the Management of Internal Audit and Risk Management has been transformed into the Department of Internal Audit and Control with division within the Department of Functional Directions “Internal Audit” and “Organization of Internal Control and Risk Management” (Minutes dated 29.08.2014 №195/2014).
Furthermore, functions have been removed from the Department of Internal Audit and Control that were not characteristic of the Department, such as control over the use of insider information and transparency of the owners of the Company’s counteragents.
With the aim of further perfection of the preventative, current, and future control, the Company is planning:

  • Further integration of the system of risk management and the system of business planning;
  • Automation of the processes of internal audit and risk management;
  • Development and approval of the standards of quality characteristics of internal audit, standards of internal audit activities, and standards of practical implementation;
  • Conducting periodical audits for appraisal of the interconnectedness of the goals of the Company’s business activity, its structural subdivisions, and key employees among each other, and with risks of the according business directions, as well as fulfilling goals and key performance indicators of effectiveness;
  • Obligatory and regular improvement of qualifications of employees of the Department of Internal Audit and Control;
  • Fulfillment of activities for improving the system of internal control in the process of conducting accounting and tax accounting and filling out accounting (financial) reporting, as well as in processes (business directions) that have a significant influence on the formation of indicators in the Company’s accounting.

(See the section Internal Control and Risk Management)