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Public Joint Stock Company Rosseti is a national operator of energy grids and one of the largest electric companies in the world. It includes subsidiaries and affiliates, as well as research, design and construction organisations.

The company maintains 2.34 million km of power transmission lines and 502,000 substations with transformer capacity of more than 780 GW.

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President of Russia Vladimir Putin: Good afternoon.

Let us begin our meeting with a simple question that is of major concern to the people. How would you assess your company’s performance in the autumn and winter period?

Rosseti CEO Pavel Livinsky: Mr President, the national grid sector is operating steadily. In late 2018, we completed preparations for peak consumption periods in the autumn and winter and converted to a new risk-oriented scenario, under which we do not invest money where our accountants say but where we need it to settle real problems.

First of all, I would like to update you on the figures. Over 50,000 people are on duty to ensure our performance during peak periods. They are divided into 10,000 emergency teams, including 583 mobile teams with some 4,000 personnel. We have over 5,000 reserve sources with a total capacity of nearly 400 MW. They are in working order and ready to deal with any emergencies across Russia.

In late 2018, we enhanced reliability and reduced the number of technological violations by 17 percent. Most importantly, the duration of technological violations plunged by 40 percent.

At the same time, we have been able to reduce our losses to below 9 percent for the first time. We started 2019 with these parameters, and we are now assessing the autumn-winter situation.

Mr President, I would also like to note that the weather and abnormal meteorological phenomena are very challenging. During the New Year holiday season, we encountered serious aberrations, including a storm in the Baltic Sea whose epicentre was in Kaliningrad Region.

Fortunately, the situation was better than in the neighbouring countries. Almost 282,000 subscribers were cut off in Finland, as well as 300,000 in Sweden. Fewer than 3,000 subscribers had no electricity in Kaliningrad Region, and we restored supply very quickly.

A focus on the sector’s digital transformation, high-quality preparations and a risk-oriented approach towards winter wherever necessary, especially efforts to cut down trees along power transmission lines, yield immediate results.

Vladimir Putin: I was actually in Kaliningrad at that time, and I recall the situation.

What are your most important short-term plans?

Pavel Livinsky: Mr President, we are working in three directions: enhancing infrastructure reliability and accessibility, improving the group’s financial standing and, of course, innovation development.

I would like to note briefly that our financial standing remains stable. Our corporate rating has increased together with the Russian Federation’s sovereign rating. We are working to closely monitor the transparency of procurement procedures and the improve business processes. And, of course, we are keeping watch, with the Government’s support, on the changes and improvements in the regulatory environment, so as to raise the network’s performance to an entirely new level.

In compliance with Executive Order No. 207 of May 7, we are working on digital transformation. At the end of 2018, under the chairmanship of Energy Minister Alexander Novak, who is Chairman of the Rosseti Board of Directors, we adopted a concept outlining the roadmaps of digital transformation for each Rosseti affiliate.

First of all, it concerns the development of smart metering. This is a priority for us because no digitalisation is possible without it. It includes almost 22 million meters that we will have to install at our own expense.

Here I would like to note, Mr President, that the huge order for our industry can become a development boost for the Russian component-making industry. The Government is overseeing this issue.

We have already held meetings with the Ministry of Industry and Trade and with defence industry enterprises. We believe that these are our partners in solving our tasks, in expanding production.

Using this order, we can develop a Russian microchip, a component-based system for meters. In the technical specifications, we could list our requirements for Russian-made equipment. Thus, we believe we will make a serious contribution to digitalisation and the development of innovative Russian industrial technology.

Mr President, special emphasis is being put on the development of a system of operational and technology management. Of course, the Russian grid complex will be more reliable when Russian-made systems appear.

I commit to develop such a system within the next three years. I already reported to you about it at the meeting of the commission on the fuel and energy sector that took place in Kemerovo.

It is crucially important for us to make the machines operate without humans, so that operators interfere only when something goes wrong. A digital transformation is also impossible without it.

We are testing the ‘digital electrician’ technology and I will also show how it operates in the Moscow energy system at the end of the year.

We have many investment projects. In 2018, we have developed and applied digital solutions, in particular, at the Medvedevskaya substation in Moscow, which is fully digital and operating now in digital format. This has dramatically reduced service costs. We have also digitalised the construction projects on the Taman Peninsula ensuring a reliable electricity supply in Crimea as well as southern Russia.

I would like to use this occasion to invite you to attend, if possible, the opening ceremony of the Port substation, which provides electricity for the railway lines of the Crimean Bridge and the port of Taman. With a capacity of 432 GW, this substation is a backbone energy facility in southern Russia. It is brand new and digitally controlled.

Vladimir Putin: Good, thank you very much. I am aware of your plans and of this project. I will try to find time for this.

Pavel Livinsky: Thank you, Mr President.

We lay emphasis on state programmes and the Comprehensive Plan for Upgrading and Expanding Mainline Infrastructure. We are closely monitoring the operations of all such projects, timely providing energy infrastructure to all groups of consumers.

I would like to focus on the Affordable Living programme, where we are working under Energy Ministry control to cut the costs and the time needed to connect consumers to the system.

We are ready to be the Responsibility Centre and the operator, so that not only the Affordable Housing programme but also all other state programmes have access to a reliable and affordable grid infrastructure.

We are doing our best. We have the wherewithal for this. Budget funds have been earmarked and the programmes have been prepared.

Of course, we associate our development primarily with cutting-edge domestic technologies, which we have incorporated into our programme and coordinated with the digital transformation. We are highlighting this transformation as an opportunity to move the operations of the grid system to a revolutionary level and to cut costs without increasing the tariffs.

We also say that the tariffs can be adjusted to below the inflation rate. Rosseti is a socially responsible company. We are aware of the real state of affairs and can find internal reserves. We know that we have them.

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