Environmental Policy

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General

The ecological policy of JSC “OGK-2” (OGK — wholesale generating company) is developed in accordance with the Russian Federation’s strategy for environmental security and sustainable use of natural resources, and its ecological doctrine, and with the ecological policy of RAO “UES”. It also takes into account views of leading public ecological organizations.

“OGK-2” (presently comprising of five power stations with total installed capacity of 8,695 million kW) is an important producer of heat and electrical energy in the Russian Federation, and supplier of highly efficient and clean energy. This is a factor defining the impact of the Company’s production activities on the environment, including air pollution emissions, discharge of pollutants into water, industrial waste disposal, as well as negative effects of noise, heat, vibration and electromagnetic fields.

As a subsidiary of RAO “UES”, JSC “OGK-2” is bound by commitments that the Russian Federation undertook as a signatory of the UN Convention on Long-range Transboundary Air Pollution and protocols to it (Geneva, 13.11.1979,#4005), United Nations Framework Convention on Climate Change (New York, 9 May 1992) , the Kyoto Protocol, Gleneagles Plan of Action (Climate Change, Clean Energy and Sustainable Development (Gleneagles, 2005).

The forthcoming accession of Russia to the World Trade Organization, and the integration of the electric power markets of Russia, the Commonwealth of Independent States and the European Union call for and bring about stronger ecological priorities in the Company’s activities.

It is the ecological policy of JSC “OGK-2” that shapes and defines principles, aims, objectives and main trends in the activities of the Company targeting environmental protection and promoting long-term ecological security.

These are the fundamental principles of the ecological policy of JSC “OGK-2”:

recognition of people’s constitutional right to healthy environment;
prioritizing ecological security as a component of national security;
taking responsibility for environmental protection in developing electricity industry in the regions of the Russian Federation;
energy saving and sustainable use of natural and energy resources in the production of electrical and heat energy;
scientific validation of environmental policy and promotion of environmental protection research in electricity industry;
prioritizing adoption of best available technologies over employment of measures to minimize environmental damage from working equipment (on the basis of a feasibility study);
adopting managerial and investment decisions based on multiple development scenarios with account taken of environmental priorities;
allowing production activities on land and water areas of high environmental value only in exceptional cases pursuant to special resolutions by state authorities;
environmentally safe treatment and reduction of industrial waste;
prioritizing prevention over damage repair;
cooperating with international community in the use of clean and energy efficient technologies and offering assistance in research in energy facilities’ environmental impact and climate change;
transparency and accessibility to environmental information, immediate notification of all interested parties of accidents, their environmental implications and accident response;
transparency and availability of the Holding’s current environmental monitoring data, involvement of all interested parties in researching environmental impact of energy facilities at design and construction stages.

Environment Policy of JSC “OGK-2”:

Aims, Objectives and Directions

JSC “OGK-2” aims to improve environment safety and increase capitalization by taking an integrated approach to the use of water and other natural resources, and providing environmentally safe generation, transportation and distribution of energy.

To achieve this, the Company is planning the following:

Reducing the Holding’s negative impact on the environment.

1.1. Reducing discharges into the atmosphere of:
- nitrogen oxides;
- solid particles;
- sulphur oxides;
- greenhouse gases.
1.2. Reducing pollutant discharges into water.
1.3. Sustainable use of water resources by heat power stations.
1.4. Reduction of industrial waste generated.
1.5. Increased use of ash-slag waste.
1.6. Reduction in specific emissions and discharges of pollutants per tonne of fuel equivalent (kg/tfe) or unit of output (kWh, Gcal).
1.7. Energy loss reduction in heat networks.

Key directions to accomplish the task:
- technological modernization and staggered decommissioning of outdated equipment, introduction of cutting edge technology to produce heat and electrical energy;
- improving power generation technologies, implementing power supply programs;
- reducing the antropogenous impact on environment;
- implementation of procedures to increase effectiveness of fuel supply systems;
- reducing production waste, maintaining safe ways of handling and processing waste;
- prevention of water pollution and preservation of bioresources at the hydrotechnical sites of power stations.
Creating conditions and techniques to minimize the negative impact of electroenergetical plants on the environment.
Key directions to accomplish the task:

2.1. Improving the law, developing and assisting in the adoption of technical regulations and standards. This necessitates:
- active participation in updating current environmental protection laws and harmonizing Russian environment laws with the European Union’s law on power plants;
- drafting and initiating for adoption a set of technical regulations in accordance with the Federal Law “On technical regulation”;
- drafting the Company standards to serve as a basis for draft proposals on new national ecological standards in the energy industry.
2.2. Improving corporate management of environment, natural resources, prevention and emergency situations response issues and adoption of ecological management standards in accordance with ISO 14001.

The system of ecological management should be an integral part of corporate management and the most important element in the non-financial risks management systems employed by the Holding.

To set it up, the following provisions should be met
- regular environmental audits of working enterprises of the electrical energy sector;
- assessment of industrial and environmental risks, development and implementation of risk mitigating measures, and compensation for losses;
- adoption of measures for prevention of and response to accidents negatively impacting the environment;
- operational planning based on environmental target performance indicators, monitoring and evaluation;
- raising qualifications of the staff maintaining energy objects and taking responsibility for industrial and ecological safety of a company;
- ecological monitoring, setting up ecological record keeping;
- environmental risk management, development and adoption of mitigating measures, and compensation for losses incurred;
- development and implementation of economic incentives to encourage efforts to reduce pollutant emissions into the environment;
- observance of standards and norms adopted by RAO “UES” in the interests of industrial, environmental and work safety, by contractors, working on RAO “UES” property;
- review, correction and improvement, where necessary, of the Company’s environmental policy.

Conclusions

JSC “OGK-2” shall promote cooperation with international governmental and non-governmental organizations, scientific and educational institutes that work successfully in environmental protection and safety.

Implementation of this policy will allow:

to cut down the negative impact on the environment;
to raise the competitiveness of electrical power on the foreign and domestic markets;
to raise social responsibility of JSC “OGK-2”.

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General

Environment Policy of JSC “OGK-2”:

Aims, Objectives and Directions

Conclusions