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. Last Updated: 07/27/2016

Mosenergo Hands UES Reform Plan

Moscow utility Mosenergo gave its parent company Unified Energy Systems a plan to split the city's power plants off from grids, a consultant on the restructuring plan said Monday.

Dmitry Vasilyev, a former Federal Securities Commission chief who advised Mosenergo on the plan, said the utility had proposed to spin off its power plants into a single company that could consolidate with generators from neighboring regions.

"There is still a lot to come -- discussions with UES and other shareholders and the Moscow city government," Vasilyev said by telephone. "These two will be moving in different directions, but I think we can find a compromise."

He said UES had not spoken up against any of the proposals, which were formally handed over Friday. Vasilyev, now head of the Institute of Corporate Law and Governance, said the plan fitted reform guidelines issued to subsidiaries by UES's board.

The government has ordered UES to split off its power plants from its national grid monopoly, forcing them to compete when the power market is liberalized.

UES plans to consolidate the dozens of power plants it controls directly into eight to 10 national companies.

It is drawing up restructuring plans for subsidiaries such as Mosenergo, which control both power plants and grids, but its board approved a blueprint last month setting out basic principles for dividing their grids, plants and marketing units.