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SUEK continues energy capacity upgrade

30 June 2022

The Technical Director of Siberian Generating Company (SGC, the Group’s energy business) speaks about investment programmes in 2022.

The summer repair campaign has kicked off. Please, explain how current or major repairs differ from equipment upgrades.

—In fact, there are many more terms: renovation, modernisation, technical re-equipment. Put simply, repairs are activities aimed at restoring equipment to a good working order. They are necessary for further operation with the characteristics specified at the engineering stage. We make repairs every year. Naturally, these activities do not bring an increase in quality or efficiency, a growth of quantitative indicators. We just maintain our equipment in its original state.

Modernisation is a more serious intervention, with a purpose to raise efficiency, installed capacity or achieve some kind of environmental effect. It addresses a more ambitious task – not just to restore, but to improve.

The most serious modernisation is underway as part of the DPM-2 federal programme (capacity supply agreements). It should create conditions for the upgrade of power generating facilities, improve their reliability, safety and efficiency. It will last until 2027. However, we hope that the programme will continue to exist even after this date, with more generation facilities selected for modernisation purposes, and we will continue taking part.

Which SGC's facilities have been included in the DPM-2 programme?

—Many of our power plants have been selected for participation in the programme, including Krasnoyarsk CHPP-1, CHPP-2 and CHPP-3, Biyskaya, Novo-Kemerovskaya and Abakanskaya CHPPs, Reftinskaya, Primorskaya, Tom-Usinskaya and Belovskaya GRESes.

Our modernisation programmes differ in scope and goals. For example, we are going to expand Krasnoyarskaya CHPP-3 by building a new power unit. The first unit was built under DPM-1, the second one is being built now.

We are also implementing a complex yet exciting project at Primorskaya GRES, aimed at improving quality indicators and increasing the hours of operation during the year. Primorye is an energy-deficient region in the Russian Far East, and any power scheduled or unscheduled outage is critical. To achieve an increase in plant load, we are upgrading it. This work extends to all units, and we plan to spend a lump of money. We hope that our efforts will bring obvious benefits: in 2024 (scheduled completion date), we will see a significantly revamped plant.

What is the top priority of these upgrades: improving efficiency, reliability, or, perhaps, an environmental effect?

—There is no single priority because the reference conditions for each power plant are different. Of course, the number one task today is to reduce our negative impact on the environment. The most striking example of environmental modernisation is our Krasnoyarskaya CHPP-1, where we will commission 14 new electrostatic precipitators until 2024. A large-scale revamp is expected at Kemerovskaya GRES. This is the first Kuzbass power plant built according to the famous GOELRO plan (State Electrification Commission's plan in USSR). It is clear that the equipment used there is far from young, dating back to the 1970s. The existing electrostatic precipitators have served out their service life, which can hardly be extended under current repair programmes; it is time for serious upgrades. They will start in 2023, and now we are busy developing design documents. The complexity is associated not with finance, but with a very limited space: we are constrained by existing equipment, and we need to fit into it.

Next I will say that the priority will always be the reliability of generation. We operate in Siberia with its low temperatures at least half of the year, so we cannot afford any faulty or defective equipment.

Cost benefits are also very important for any generating company. If we see that a project brings such benefits, we take it on even despite major challenges.

Can a decrease in the marginality of energy projects become an obstacle to further modernisation?

—We recently held a meeting of our investment committee, which considered project effectiveness in the context of rising material prices. We came to the conclusion that this year we will deliver all our plans, as even with a significant decrease in marginality, the effect achieved from equipment upgrades is sufficient for these projects to be implemented.

As for federal programmes, such as the would-be DPM-3, I think that the selection criteria may be revised any time soon. But the programme will be preserved because the domestic energy sector has no future without it. If we do not begin to replace generating equipment today, in a few years we will find ourselves in a dead end.

 —Have you already defined priorities for 2023?

—Priorities for the next year are already clear, and we will only slightly adjust them in the second half of the year, when we have scenario conditions for budgeting.

The challenges of recent months have forced us to change approaches and principles of dealing with our production units and contractors. Now we channel all efforts into efficiency improvements. In particular, this year we are launching several projects to introduce the resource method for digitising repair processes. It will enable us to automatically calculate the cost and timing of all scheduled activities. This way, work planning and personnel deployment will be more effective.

The role of equipment checks in making repair decisions is increasing.

All our production units have already completed the first iteration of repair plans for 2023, and now information is being processed. Then there will be a second iteration, and we hope to achieve full clarity regarding the upcoming repair programme according to the new criteria by the start of 2023 budgeting activities.


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