OREANDA-NEWS. March 24, 2008. The power generating company Vostokenergo, incorporated into Donbass Fuel-Energy Company (Donetsk, DTEK), plans to complete reconstruction of all the power units at its thermal power plants by 2016, DTEK corporate newspaper ‘Nasha Gazeta’ reports.

The key task of modernization is to step up the technical and economic indicators of the equipment, to increase the flexibility of the power units, to reduce the specific consumption of fuel for electric power generation and to increase the equipment’s service life by 50% or by 100 thou.hrs, to 300 thou.hrs.

In particular, the reconstruction of 4 power units from each of the following power plants; Zuyevskaya, Kurakhovskaya and Luganskaya TPPs, is planned to be completed by 2012.

Modernization of all the power units of Zuyevskaya TPP will make it possible to increase the installed capacity by 60 MW thus achieving a TPP flexibility range of 135-175 MW.

Reconstruction of the power units of Kurakhovskaya TPP will increase the power plant capacity by 75 MW. When this happens, the flexibility range of the power units will reach 80-110 MW.

This modernization programme at 4 power units of Luganskaya TPP will enable it to increase its installed capacity by 40 MW by 2012.

According to the General Director of Vostokenergo, Gennadiy Turanov, the modernization work will be financed by its own funds stipulated in the electricity tariff.

‘Thus, within five years from the start of reconstruction, up to 80% of the power generating companies’ expenditure for the modernization of equipment will be recovered’, he said in his interview to the newspaper.

Furthermore, Mr. Turanov has confirmed the Company’s intention to raise the borrowed funds.

According to him, the modernization of the units will be on a tender basis.

In 2007, Vostokenergo started the reconstruction of power generating unit No. 5 at Kurakhovskaya TPP and unit No. 2 at Zuyevskaya TPP.

As informed by the agency, in August 2007, the National Electricity Regulatory Commission provided about UAH 212m for the reconstruction and upgrade of unit No.2 at Zuyevskaya TPP, and unit No.5 at Kurakhovskaya TPP, in the tariff of Vostokenergo.

In September 2007, Vostokenergo declared Siemens AG Power Generation (Germany) as the successful bidder in the tender on the modernization of the turbounit К-200-130 low pressure cylinder at Kurakhovskaya TPP.

The purchase contract price is Euro 9.989m.

DTEK to Invest USD 2 bln into Development of Its Capacities by 2012

In particular, USD1.3 billion is planned to be invested into the Company’s coal enterprises, about USD650m for the development of the Company’s generating capacities, and about USD87m into electricity distribution.

The key source of financing is the Company’s own funds.

DTEK comprises 15 enterprises, including the power generating company Vostokenergo, the energy supply companies Service-Invest and PES-Energougol.

Vostokenergo incorporates Zuyevskaya, Kurakhovskaya and Luganskaya TPPs.