Page 192 - RusRPTMay21

INGKA Group, which owns the retail chain IKEA and MEGA shopping malls in Russia, had signed on 13 April an agreement with Solar Systems to acquire 49% of the shares in eight solar plants with 160MW capacity in Russia to supply green energy to all 17 IKEA shops in Russia and cover part of MEGA's consumption. The total cost of constructing the eight projects is more than RUB 21bn. The deal is subject to Federal Anti-Monopoly Service approval. According to the press release, this is the first large investment by an international company that is not related to the utilities sector into renewables in Russia. We see the news as positive, since more companies are increasing their interest in renewables and are looking for a green electricity supply. This is another addition to the recently signed green energy supply contracts: Sibur with TGK1, PhosAgro with TGK1, Polyus with RusHydro, Shekinoazot with Fortum and Hevel, Procter & Gamble with Fortum.
Unipro management, including CEO Maksim Shirokov and CFO Ulf Backmeyer gave a investors call. The key takeaways from what the company said are as follows.
· Unit 3 Berezovskaya GRES. The unit was put into testing mode for 48 hours on 30 March. According to management, everything is on track, and the first electricity payments for the unit are to appear in April vs. the first DPM payment from 1 May.
· Dividends. The company reiterated that RUB 20bn of dividends would be paid in 2021-24 as well as the interim nature of payments, with the split to be uneven in 2021. Longer dividend plans will also depend on the capex programme (the company is looking forward to light and deep modernisation (the equipment proposals are key for the auction with the localised turbine) and renewables).
· ESG. The company is carefully assessing ESG factors and is looking to reduce emissions via modernization, as well as considering the further use of emissions capture equipment. Despite Berezovskaya GRES being coal-fired, the company is not so far in talks about selling it.
· Renewables. Unipro is looking to taking part in renewables projects, but is only going to assess those with a return above the threshold. The company confirmed that it did not rule out joining forces with Fortum in renewables, but that this was up to the shareholder to decide.
· RSV. Management confirmed that 2021 is also facing elevated water inflows, which affects RSV prices and fossil-fuel generation.
InterRAO reported its 1Q21 operating results and RAS financials. Total
192 RUSSIA Country Report May 2021 www.intellinews.com