OREANDA-NEWS. On January 18, 2007 at its meeting, the Board of Directors of RAO "UES of Russia" decided to create the Strategy Committee of the Board of Directors of OAO "UES SO-CDA", reported the press-centre of RAO "UES of Russia".

This decision was taken by the Board of Directors in the course of discussion of the energy market participants' involvement in controlling the compliance by the System Operator with the wholesale electricity market rules and regulations.

Currently, such control is exercised by NP "ATS" under an agreement made with the System Operator pursuant to the provisions of the Federal Law On the Electricity Industry. Under the agreement, the System Operator is required to periodically provide detailed reports to ATS on the functioning of the Unified Energy System of Russia, and to give argumented comments if ATS has issues with the data submitted.

The report on the control of the System Operator's activities is submitted on a quarterly basis for review by the Supervisory Board of NP "ATS", which consists of representatives of generation companies, energy retail companies, and electricity consumers. A summary of such report is subsequently published. Another important element of the control system is the participation of the ATS head in the System Operator's Board of Directors.

Also, work is currently underway to finalize the Wholesale Electricity and Capacity Market's rules designed to further formalize the load of power units by the criterion of minimizing the electricity price for consumers.

The RAO UES Board of Directors noted that it is necessary to preserve the existing mechanisms of control over the System Operator's activities by the market participants after the RAO UES reorganization is completed.

Under the applicable Russian laws, the state is to secure a 100 percent stake in the System Operator's capital after the electricity sector restructuring is completed. This means that the System Operator's Board of Directors will be elected by the country's energy-related ministries and agencies.

In this connection, the Board of Directors gave the RAO UES Management Board a task to explore whether it would be possible for a representative of Non-profit Partnership "Market Council" to take part in the System Operator's Board. NP "Market Council" will be created on the basis of NP "ATS" to represent the electricity industry's new participants.

Also, it is planned that a Strategy Committee will be created in the System Operator's Board, which will comprise representatives of the state authorities, NP "ATS" (NP "Market Council"), generation and grid companies, major power consumers, System Operator management, experts and representatives of other organizations, if a resolution to that effect is taken by the System Operator's Board of Directors.

The Strategy Committee will be responsible for providing recommendations for the System Operator's Board of Directors and Management Board on a broad range of issues, including those related to measures needed to develop the Unified Energy System of Russia (electricity consumption growth forecasts, control of implementation of investment projects in the sector, the launch of a system services market, etc.), as well as those designed to improve the System Operator's activities (implementing innovations in the System Operator's activities, information disclosure, analysis of proposals relating to streamlining the internal workflows).

The Board of Directors instructed the Management Board of RAO "UES of Russia" to initiate the corporate acts needed to create the Strategy Committee at the System Operator, including the drafting of the Committee's rules and regulations and nominating candidates for the Committee.

The Management Board of RAO "UES of Russia" was also given the task to submit to the Company's Board of Directors, not later than April 2008, its proposals on the establishment of a similar committee of the FGC's Board of Directors.

The Board of Directors postponed until its next meeting the review of the proposal on the repurchase by the System Operator of its shares from RAO "UES of Russia" and their subsequent cancellation.