Investor Presentation VTB Capital Investment Forum Russia Calling! - - PowerPoint PPT Presentation

Investor Presentation

VTB Capital Investment Forum “Russia Calling!” New York April 18-19, 2012

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DISCLAIMER

This document is confidential and has been prepared by JSC RusHydro (the “Company”) solely for use at the presentation and may not be reproduced, retransmitted or further distributed to any other person or published, in whole or in part, for any other purpose. This document does not constitute or form part of any advertisement of securities, any offer or invitation to sell or issue or any solicitation of any offer to purchase or subscribe for, any securities of the Company in any jurisdiction, nor shall it or any part of it nor the fact of its presentation, communication or distribution form the basis of, or be relied on in connection with any contract or investment decision. These written materials are not an offer of securities for sale in the United States. Securities may not be offered or sold in the United States absent registration or an exemption from registration under the U.S. Securities act of 1933, as amended. Any public offer or distribution of securities to be made in the United States will be made in accordance with a prospectus that may be obtained from the issuer or selling security holder and that will contain detailed information about the company and management, as well as financial statements. The Company has not registered and does not intend to register any portion of any offering in the United States or conduct a public offering of any securities in the United States. This presentation is only addressed to and directed at persons in member states of the European Economic Area who are "qualified investors" within the meaning of Article 2(1)(e) of the Prospectus Directive (Directive 2003/71/EC) ("Qualified Investors"). In addition, in the United Kingdom, this presentation is being distributed only to, and is directed only at, (i) Qualified Investors who have professional experience in matters relating to investments who fall within Article 19(5) of the Financial Services and Markets Act 2000 (Financial Promotion) Order 2005, as amended (the "Order") and Qualified Investors falling within Article 49(2)(a) to (d) of the Order, and (ii) Qualified Investors to whom it may otherwise lawfully be communicated (all such persons together being referred to as "relevant persons"). This presentation must not be acted on or relied on (i) in the United Kingdom, by persons who are not relevant persons, and (ii) in any member state of the European Economic Area other than the United Kingdom, by persons who are not Qualified Investors. Any investment or investment activity to which this presentation relates is available only to (i) in the United Kingdom, relevant persons, and (ii) in any member state of the European Economic Area other than the United Kingdom, Qualified Investors, and will be engaged in only with such persons. The distribution of this presentation in other jurisdictions may be restricted by law and persons into whose possession this presentation comes should inform themselves about, and observe, any such restrictions. No reliance may be placed for any purpose whatsoever on the information contained in this document or on assumptions made as to its completeness. No representation or warranty, express or implied, is given by the Company, its subsidiaries or any of their respective advisers, officers, employees or agents, as to the accuracy of the information or opinions or for any loss howsoever arising, directly or indirectly, from any use of this presentation or its contents. This document may include forward-looking statements. These forward-looking statements include matters that are not historical facts or statements and reflect the Company’s intentions, beliefs or current expectations concerning, among other things, the Company’s results of operations, financial condition, liquidity, performance, prospects, growth, strategies, and the industry in which the Company operates. By their nature, forwarding-looking statements involve risks and uncertainties because they relate to events and depend on circumstances that may

• r may not occur in the future. The Company cautions you that forward-looking statements are not guarantees of future performance and that the actual results of operations, financial

condition and liquidity of the Company and the development of the industry in which the Company operates may differ materially from those made in or suggested by the forward-looking statements contained in this document. In addition, even if the Company’s results of operations, financial condition and liquidity and the development of the industry in which the Company

• perates are consistent with the forward-looking statements contained in this document, those results or developments may not be indicative of results or developments in future periods.

The Company does not undertake any obligation to review or confirm expectations or estimates or to update any forward-looking statements to reflect events that occur or circumstances that arise after the date of this presentation.

By attending this presentation, you agree to be bound by the foregoing limitations.

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RusHydro: the Leading Russian Utility & Renewables Player

Russia’s largest genco and one of the world’s largest publicly traded hydro generation companies, with capacity of ca. 35 GW The biggest winner from electricity market liberalization in Russia due to extensive exposure to low-cost hydro generation Focus on improving efficiency of existing assets and successful completion of ongoing M&A deals The most liquid generation company of the Russian stock market, with average daily trading volume of more than USD 50mn Included in the MSCI Emerging Markets and MSCI Russia indices, with weights of 0.09% and 2.1%, respectively GDRs listed on the LSE, ADRs trading OTC and OTC QX in New York

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RusHydro at a Glance (1): before acquisition of RAO ES of East

Installed capacity

26 GW

Electricity generation (2011)

77 TWh

Average annual generation

79.7 TWh

Cascade of Verkhnevolzhskiye HPPs, 457MW Nizhegorodskaya HPP, 520 MW Kamskaya HPP, 522 MW Votkinskaya HPP, 1020 MW Zhigulevskaya HPP, 2320 MW Volzhskaya HPP 2582,5 МW Novosibirskaya HPP, 455 МW Sayano-Shushenskaya HPP, 6721 МW (incl. Maynskaya HPP) Bureyskaya HPP, 2010 МW Kolymskaya HPP, 900 МW Verkhne-Mutnovskaya GeoPP, 12 МW Mutnovskaya GeoPP-1, 50 МW Cheboksarskaya HPP, 1370 MW Saratovskaya HPP, 1360 MW Kabardino-Balkarian branch, 90,1 МW Karachaevo-Cherkessian branch, 160 МW North-Ossetian branch, 78,2 MW Dagestan branch, 1381,8 МW Cascade of the Kubanskiye HPPs, 462,4 MW Irganaiskaya HPP, 400 МW Zaramagskiye HPPs, 352 МW Pauzhetskaya Geo PP 12 МW

Wind PPs

Ust’-Srednekanskaya HPP, 570 МW Kislogubskaya TPP Boguchanskaya HPP, 3000 МW Krasnoyarsk Energy Trading Company Lengidroproekt VNIIG Zagorskaya PSHPP-2, 840 МW NIIES Ryazan Energy Trading Company Zagorskaya PSHPP, 1200 MW Kashkhatau HPP, 65,1 МW Chuvash Energy Trading Company Kalmytskaya WPP Zelenchugskiye HPP, 320 МW Zeiskaya HPP, 1330 МW Institute Hydroproject Krasnoyarskaya HPP, 6000 МW (25%)

Operating HPPs Operating HPPs under reconstruction Operating HPPs w/construction underway GeoPPs Tidal PPs HPPs under construction R&D institutes Energy retail companies

Armenia

Sevan-Hrazdan cascade, 561MW

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Peer group comparison

RusHydro is the largest listed hydropower generation company in the world and one of the largest generating companies in Russia

Source: Factset, Bloomberg

EV/EBITDA-10 EV/EBITDA-11E EV/EBITDA-12E EV/Capacity, USD/kW EV/Output-10, USD/MWh MCap, USD mln.

RusHydro 5,1 4,8 4,7 385 139 10 084 Tractebel Energia 8,0 7,5 6,9 1 860 282 10 029 Verbund 11,4 11,6 9,5 1 947 541 10 326 China Yangtze Power 10,2 10,0 9,8 1 317 293 16 404 Eletrobras 7,2 6,4 5,4 686 142 13 551

RusHydro vs. selected peer companies: valuation benchmarks

10 10 12 13 15 18 23 26 31 34 34 Iderdrola Fuma CE Vattenfall Statkraft Eurosibenergo Three Gorges EDF RusHydro Enel Eletrobras HydroQuebec RusHydro capacity vs. hydro capacities of global peers (GW)

11.2* 22,7* 18.7* 31.7*

8.8 10.3 19.5 20.4 28.5 36.2 34.8** Enel OGK-5 E.On Russia EuroSibEnergo Rosenergoatom InterRAO Gazprom RusHydro

*- attributable capacity, i.e. amount of capacity on an equity-adjusted basis ** - incl. assets of RAO ES of the East

RusHydro in Russian electricity generation (GW)

New capacity: time to reap the benefits

999 8086

999 640 420 999 420 640 169 140 100 640 640 640 640

• 8 GW of new hydro and pumped storage capacity coming online in 2012-2013 vs less than 3 GW in 2000-2010
• Over 1.4 GW are contracted under Capacity Supply Agreements (DPM), providing a rate of return of 10.5% for 20 yrs
• 1920 MW will be launched each year in 2012-2013 on Sayano-Shushenskaya plant, bringing its total installed capacity to pre-

accident level by 2014. Replacement of 3 restored units by new ones will be finished by 2016

• Ca. 1 GW of capacity will be added through 2025 as a result of extensive modernization of hydropower plants, primarily of the

Volga-Kama cascade

• Positive cash-flow expected in 2014

2012:

4338 MW

2013:

3748 MW

* - Boguchansk HPP is part of the Boguchansk electrometallurgical complex, 50/50 JV with RUSAL, therefore 50% of its installed capacity can be attributed to RusHydro

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0.0 10.0 20.0 30.0 40.0 50.0 60.0 2007 2008 2009 2010 2011 2012 2013

Capacity commissioned/capex ratio

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FY 2011 RAS results*

RUR mln FY2011 FY2010 Change

Revenue 92,504 88,979 4% Operating expenses (44,016) (45,516)

• 3%

Gross profit 48,489 43,464 11% Other income 23,805 88,806

• 73%

Other expenses (32,219) (85,537)

• 62%

EBITDA** 57,557 51,608 11% EBITDA margin 62% 58% 4 p.p. Net profit 30,622 37 817

• 19%

Net profit (adjusted) *** 36,502 33 015 11%

Results mainly driven by:

* - Results under Russian accounting standards do not consolidate financial results of a number of generating assets (Kolymskaya hydropower plant, Sevan- Hrazdan cascade in Armenia, geothermal plants et al.) and other businesses (BEMO project, electricity retail, R&D institutes et al.) that are incorporated as subsidiaries or affiliates and, therefore, are not eligible for consolidation under RAS. ** - EBITDA calculated as gross profit before depreciation. *** - Net profit adjusted for mark-to-market revaluation of listed equity stakes, reserves for impairment of financial investments, assets and potentially uncollectible accounts receivable.

• increase of revenue on the back of increase of electricity generation; increase of electricity sales on the day-ahead market

following the electricity market liberalization that finalized in 2011; higher electricity prices on the day-ahead market;

• decrease of revenue from capacity sales as a result of scaling down of investment component in capacity prices last year;
• decrease in electricity and capacity purchases as a result of: decrease of regulated electricity sales following the liberalization of

the power market, which coupled with higher electricity generation also resulted in lower power purchases; decrease of bilateral unregulated electricity sales in 2011, which incurred large power purchases in 2010; decrease of capacity purchases by Sayano- Shushenskaya hydropower plant following its gradual restoration;

• mark-to-market revaluation of financial investments (RUR 5,138 mn);

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4Q and FY2011

• perating results update

Results mainly driven by: 4Q2011 4Q2010 chg,% FY2011 FY2010 chg,%

Far East 3 122 3 314

• 6

12 068 13 351

• 9.6

Siberia, including 4 941 4 703 5 21 372 14 046 52.2 Sayano-Shushenskaya HPP 4 688 4 413 6 19 613 11 908 64.7 Center 7 932 6 858 16 34 899 35 192

• 0.8

South and Northern Caucasus 1 397 1 166 20 6 694 8 088

• 17.2

Armenia 49 68*

• 27

642 718*

• 10.7

RusHydro Group net output 17 442 16 041 9 75 675 70 677 7 Net electricity output, GWh

• Continuing restoration of Sayano-Shushenskaya plant (all 4 restored units – 2,560MW – in operation in 2011

as opposed to partial operation of units in 2010) and normal reservoir levels in Siberia in 2011

• The rigorous policy of water saving in the reservoirs of Volgo-Kama basin that resulted in higher output in 3-

4Q of 2011

• Subnormal reservoir levels in 2-3Q 2011 in the Far East of Russia and artificially low reservoir level of

Zeyskaya hydropower plant due to ongoing maintenance

• Lower water inflow in the Russian South and Northern Caucasus in 2011 and unscheduled outage of

Irganayskaya hydropower plant in the 1H 2011 Generation volumes in 2H 2011 signal of recovery from unprecedented fraught of 2010, which coupled with new launches should boost RusHydro output in the mid-term

* - the figures are not included in the total sum, as RusHydro acquired Sevan-Hrazdan cascade of hydropower plants in Armenia in March 2011

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Electricity spot prices dynamics in 2010/2011

Higher electricity prices and unregulated sales to a great extent offset the decline in net output in European part of Russia due to poor water conditions, while Siberian generation benefited from recovering production volumes of Sayano-Shushenskaya plant

* - the data from the trading operator – JSC ATS

400 600 800 1000 1200 1400 1600 01/01/10 01/03/10 01/05/10 01/07/10 01/09/10 01/11/10 01/01/11 01/03/11 01/05/11 01/07/11 01/09/11 01/11/11

12M2010 12M2011 +12% y-o-y

250 300 350 400 450 500 550 600 650 700 750 01/01/10 01/03/10 01/05/10 01/07/10 01/09/10 01/11/10 01/01/11 01/03/11 01/05/11 01/07/11 01/09/11 01/11/11

12M2010 12M2011 +11% y-o-y

Day-ahead market – Siberia, RUR/MWh* Day-ahead market - Europe and Urals, RUR/MWh*

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RAO ES of the East: asset overview

Yakutskenergo 1480 MW 1541 GCal/h Chukotenergo

153 MW 376 GCal/h

Magadanenergo 320MW 646 GCal/h Kamchatenergo 462 MW 542 GCal/h Integrated energy system of East** 5,901 MW 12,639 GCal/h Sakhalinenergo 480 MW 424 GCal/h

Installed electric capacity 8,796 MW Installed heat generation capacity 16,168 GCal/h Electricity lines (30-220 kV)

• ca. 35,000 km

Electricity generation (2011) 30,368 GWh Heat generation (2011) 33.2 mln GCal/h

69.3% 20.2% 10.5%

Current shareholders*

RusHydro Other shareholders Gazprom Energoholding

73% 20% 7%

Fuel mix

Coal Gas Fuel oil and diesel 2009 2010 Revenue (mln RUR) 95,540 114,643 Operating profit (mln RUR) 127 1,926 EBITDA (mln RUR) 6,660 10,016 Net profit (mln RUR)

• 1,178

3,865

* - before share issue placement, which is currently in progress ** - includes energy systems of Amur region, Khabarovsk, Evreyskaya autonomy, Primorskiy kray, south of Yakutia

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RAO ES of the East acquisition: transaction overview Transaction Shareholder rights Transaction economics

• Non-cash acquisition of a 69.3% stake in RAO ES of the East (holding company) from the Russian

state through additional issue of shares

• RAO Energy Systems of the East and its subsidiaries form a vertically-integrated holding, comprising

power and heat generating plants, transmission and distribution assets in the Russian Far East (8.8 GW of installed electric capacity, 16.7 thousand GCal/h of installed heat capacity)

• In cash terms the deal is valued at over RUR 12 bln, of which RUR 11.8 bln is the controlling stake in

RAO ES of the East.

• The acquisition doesn’t entail obligatory tender offer to minority shareholders of RAO ES of the East
• EGM of RAO ES of the East elected 5 representatives of RusHydro to its Board of Directors (out of

total 9) at the EGM on November 30, 2011

Rationale

• Gradual redistribution of electric load from inefficient thermal power plants to more efficient low-cost

hydropower plants

• Realization of electricity export potential
• Increasing RusHydro’s installed capacity by over 8 GW

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RAO ES of the East development agenda

New value

RAO ES of the East

Long-term tariff regulation Financial

• ptimization

Lean production for existing capacity Liquidation of holding discount Capacity replacement CAPEX Disposal of Far East DistCo RusHydro will sell Far Eastern distribution company, part RAO ES of the East holding, to FGC UES for RUR 19.3 bln, to focus on the generation business and direct the proceeds to new projects to replace the obsolete generation fleet New efficient capacity build-up to replace the obsolete generation fleet, which should dramatically decrease fuel, maintenance and labor costs Optimization of the organizational structure of RAO ES of the East holding, improvement

• f and simplification of governance procedures, increased transparency and active

investor relations Introduction of new standards and KPIs of operational efficiency, rigorous fuel and materials saving policy, timely shutdown of inefficient capacity after substitute capacity is in place Optimization of debt portfolio, introduction of cost-cutting initiatives, improvement of accounts receivable management Negotiation of more efficient tariff system with local authorities: based on long-term regulation, fostering cost-saving and providing a rate of return

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Far East Growth Strategy and Industrial Development

Amurskaya oblast’

Constuction of Vostochny cosmodrome

Primorsky region

VSTO oil pipeline, Primorsky oil refinery, LNG plant and terminal, infrastructure for APEC summit

Magadan region

Natalka gold field

Sakhalin region

Oil refinery

Khabarovsk region

Wood-processing plant

Yakutia

Elga coal field, metals field Taezhnoe, Tarynnakhskoe iron ore field and construction of iron

• re complex, gas-construction of gas-processing

complex

2000-2009 2010-2030 Russia 1.6 2.4-3.3 Far East 1.1 2.9-3.9

Electricity consumption CAGR, %

Key industrial projects in the Far East

KEY STRATEGIC GOALS IN ENERGY BY 2025:

• Increase of load factor of thermal power plants from 39% to 54%

through more efficient use of cogeneration;

• Decrease of fuel consumption per 1 kW of electricity generation by

15% following commissioning of more efficient generation facilities

• Increase of annual output by hydroelectric power plants by ca. 50%

to 13 TWh

• Decrease of capacity reserve from 67% to 33% through more

efficient load of existing capacities and development of interconnection capacity

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Eurosibenergo investment: potential deal overview

RusHydro

Irkutskenergo

40%

Krasnoyarsk HPP

25.1%

Dams of Angara cascade

Irkutsk gridco

52%

MAREM+

100%

Eurosibenergo Engineering

100%

SWAP

Volgaenergo

100%

Krasnoyarsk HPP

68.3%

Irkutskenergo

50.2%

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Eurosibenergo: asset overview

Krasnoyarsk region

Irkutsk region

Krasnoyarskaya Hydropower Plant Capacity – 6 GW, generation – 18.5 TWh p.a. Ust’-Ilimskaya Hydropower Plant Capacity – 3.84 GW, generation – 21.5 TWh p.a. Bratskaya Hydropower Plant Capacity – 4.5 GW, generation – 22.5 TWh p.a. Irkutskaya Hydropower Plant Capacity – 662 MW, Generation – 4.1 TWh p.a.

Nizhny Novgorod region

Avtozavodskaya CHP (580 MW) Combined heat and power plants (CHP) with total capacity of 4.46 GW. All CHPs, with the exception of gas-fired Avtozavodskaya CHP, are coal-fired

2009 2010 Revenue (mln RUR) 72,128 87,145 Operating profit (mln RUR) 14,026 21,814 EBITDA (mln RUR) 19,429 27,409 Net profit (mln RUR) 19,271 13,136 Installed capacity (MW) 19,500 19,500 Hydro 15,000 15,000 Electricity generation (MWh) 82,800 87,100 Coal reserves (mln t) 1,260 1,260

High-quality integrated utility with exposure to hydro, aluminum production, electricity export, and excellent organic growth prospects

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Eurosibenergo investment: transaction highlights Transaction Shareholder rights

• Non-cash acquisition of a significant in Eurosibenergo through swap of 40% in Irkutskenergo,

25.1% in Krasnoyarskaya HPP and 5 dams of Angara cascade with majority shareholder – En+

• Eurosibenergo is a vertically integrated energy holding with 19.5 GW of electricity generation

capacity (15 GW – large hydro) and 17,485 GCal/h of heat capacity. The holding company also

• perates retail, engineering and coal mining assets
• RusHydro will have a veto right when deciding on: top-management appointments, dividend

distribution, significant business change, business and investment plans etc.

• RusHydro will appoint Board members pro rata its ownership, Chairman of the Board and head of

strategy committee

Rationale

• Strengthening foothold in Siberia and increasing liquidity of Siberian assets
• Realizing synergies with RusHydro’s existing businesses, including project design, engineering,

R&D

• Coordinating load optimization to increase hydro output in Siberia
• Increasing RusHydro’s installed electric capacity by 6.8 GW (on an equity basis) with high-quality

assets in line with strategic plan

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Siberian growth strategy and potential

BEMO - 50/50 RusHydro and RUSAL JV Hydropower plant: 3 GW Aluminium production: 580,000 t p.a. 2013: HPP full launch and smelter 1st phase launch RUSAL’s Tayshet aluminum smelter Aluminium production: 750,000 t p.a. Tuva mining company Coal reserves: 300 mln tonnes

Electricity export to China

up to 38 TWh p.a. in 2020*

North Siberian railroad (SevSib) Length: 2,000 km Vankorskoe oil-field Reserves: Oil - 524 mln t (ABC+C2); gas - 106 bcm Verkhnechonskoe oil-field Reserves: Oil - 524 mln t (ABC+C2); gas - 106 bcm

• Development of numerous energy-intensive projects will drive the electricity

consumption and spur economic growth in the region for years to come

• Siberia has unsurpassed potential for further development of electricity generation,

especially hydro, including for export sales

• The strategy of socio-economic development of Siberia forecasts growth of gross

regional product in the region above average Russian level until 2020

208 239 260 2010 2015 2020

CAGR +2.3%

Electricity consumption projection, TWh*

41 70 103 2010 2015 2020

CAGR +9.6%

Per capita investments, ‘000 RUR/person**

** - Strategy of socio-economic development

• f Siberia until 2020, base case scenario (as

approved by the Russian government in July 2010) * - General Scheme for the Installation of Electricity Facilities until 2020 with an outlook to 2030 (base case scenario)

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New value paradigm

maximization of stake value through responsible shareholder action and extensive rights, liquidity increase after IPO unlocking efficiency reserve, non-core assets divestment, creating sustainable earnings growth, realization of export potential excellent organic growth prospects on the back of comprehensive modernization of the fleet and

• ptimal capacity construction pipeline

effective sale to a strategic investor

Treasury stock

Strategic stake in Eurosibenergo The dominant position in the utilities sector in the Far East of Russia

The largest hydropower generation fleet in Russia

Sub-optimal representation in the Far Eastern region with huge potential Ageing assets

• perating under

regulatory risks Basket of assets (dams, stakes in Krasnoyarskaya HPP and Irkutskenergo) Share cross-

• wnership

with Inter RAO

KEY STRATEGIC PRIORITIES: Greater focus on profitability and value creation Revision of capex to reach operational excellence for existing assets and finalize the projects already underway Build-up of expertise in alternative renewables as Russia seeks to develop this sector Operational efficiency improvement via costs optimization and streamlining of operations

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Diversified strategic portfolio with excellent growth prospects

Europe

15 GW

Siberia

13.7 GW*

Far East

13 GW

• High earnings growth visibility
• 1.4 GW of new capacity committed under

CSA

• Opportunities of ancillary market launch
• Relatively developed interconnection

capacity Development agenda

• Modernization of assets
• Large and growing industrial

consumption

• Electricity export potential

Development agenda

• Reconstruction of Sayano-Shushenskaya
• BEMO launch
• Growth in consumption
• Extensive room for operations optimization
• Electricity export potential
• Huge potential for distributed generation

and renewables development Development agenda

• Optimization and modernization of assets
• Employee retention and motivation

QUALITY PARTNERSHIP GROWTH

Well-balanced asset portfolio:

• European Russia: sustainable growth and high earnings visibility ;
• Siberia: development based on industrial clusters and risk-sharing in partnership with En+;
• Far East: high growth potential

85% 45% 11% 41% 4% 14% 2011E 2016E

Regional contribution to pro forma EBITDA

Europe Siberia Far East

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2012 outlook and key priorities

• Company expects further recovery in electricity production on the back of further restoration of Sayano-Shushenskaya (3 new units to be launched

in 2012), new capacity commissioning (see slide 7)

• Better hydrological conditions expected for 2012, although water levels of Volga-Kama may remain somewhat below normal levels
• RusHydro and Alstom will start construction of the joint factory in Bashkiria in April

Production

• Removal of investment component from capacity will most likely be offset by decrease of capex
• The impact of regulated capacity tariffs introduced for Siberian hydropower generation and non-indexaton of capacity tariffs are non-material

for 2012

• Price-caps for KOM prices will be increased by 7% as of July 2012
• Retail business will most likely be in the red in 2012 after regulation change; Bashkiria retail company should improve the overall picture
• The regulatory pressure should subside in 2H 2012

Market development & regulation

• RusHydro will sell Far East distribution company to FGC UES for RUR 19.3 bln in 2012, proceeds will be used to finance key investment

project and optimization of debt portfolio

• RusHydro is actively developing the strategy for integration, streamlining of operations and optimization of the corporate structure of RAO

ES of the East

• RusHydro and Eurosibenergo will seek to complete the swap of assets in 2012

M&A Strategy

• Management will likely propose paying dividends for FY2011 to the Board of Directors
• Quarterly IFRS in 2012
• Management stock option plan with a strike of RUR 1.49 per share expiring in December 2012

Corporate Governance

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IR calendar 2012

2Q2012

April 18-19 VTB Capital Investor Conference “Russia Calling!" (New York) Late April FY 2011 IFRS financial results Late April 1Q 2012 operating results Mid-MayGoldman Sachs BRICs Conference (London) May 29-31 VTB Capital Investor Conference “Russia Calling!" (London) June 11-14 Bank of America Merrill Lynch CalGEMs (Laguna, USA) Mid-JuneGoldman Sachs Utilities Day Mid-June1Q 2012 IFRS financial results June 12 Morgan Stanley Russia Day (Paris) June 20-21 Bank of America Merrill Lynch Utilities Conference (London) June 21-23 XVI International Economic Forum (St. Petersburg) Late JuneAGM

3Q2012

Late July1H 2012 operating results Sep UBS Investor Conference (Moscow) Sep UniCredit Investor Conference (London) Sep HSBC Investor Conference (London) Sep 15 Morgan Stanley Utility Conference (London)

4Q2012

Early Oct VTB Capital Investor Conference “Russia Calling!" (Moscow) Mid-Oct 1H 2012 IFRS financial results Late Oct 9M 2012 operating results Late Oct Uralsib Capital Investor Conference (Stockholm,Geneva, London) Mid-Dec 9M 2012 IFRS financial results

Contact Information

Investor Relations Department Tel.: +7(495) 225-3232 ext.1319, 1394, 1607 ir@rushydro.ru

22

Thank you!

Thomson Reuters Extel 2011: No.1 IR Team in Russian Utilities

APPENDICES

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Key 2011 events update

• RusHydro paid RUR 2.5 bln of dividend for FY2010 for the first time since its establishment
• AGM of RusHydro approved additional issue of 89 bln shares to acquire 53% of RAO ES of the East, 40% of Irkutskenergo, 5 dams of hydropower

plants of Angara cascade and other assets. The Board of Directors approved valuations of assets acquired via share issue and price of share placement at 1.65 RUR

• Top-management including CEO significantly increased their shareholdings in the Company. The aggregate holding of all the members of the

Management Board amounted to 0.18% by the end of 2011

Corporate governance and corporate development

• Successful transportation of 3 new hydro-units to Sayano-Shushenskaya hydropower plant which will enable RusHydro to launch a brand

new 5th hydro-unit in December 2011 and 6th – in early 2012

• All hydro-units of Kashkhatau HPP included in Capacity Supply Agreements (DPM) mechanism put into commercial operation
• The construction of all major projects under DPM progressed on schedule

Investment projects progress

• Fitch affirms RusHydro at BB+ with stable outlook (early 2012)
• Successful RUR 15 bln domestic bonds placement at 8.0% p.a.
• Raising of RUR 40 bln from Sberbank in November on very good terms
• Continued growth and strong profitability in 2011 due to increase in spot prices and electricity output, with EBITDA margin of the generating

business reaching almost 66% in Jan-Sep 2011 (under RAS)

Financial position

• RusHydro and Alstom signed shareholders agreement to develop a joint production of hydroelectric turbines; Alstom to modernize Kuban

HPPs cascade

• RusHydro agreed to set up a JV with Voith Hydro for production of hydroelectric equipment; Voith Hydro will also modernize the turbines of

Saratovskaya HPP of RusHydro

International cooperation and branching out into manufacturing

25

RusHydro capital markets profile

* Currently, the maximum allowed amount of the DR program is capped at 13.9% of the total number of share capital

20 40 60 80 100 120 07.07.09 18.08.09 29.09.09 10.11.09 22.12.09 03.02.10 16.03.10 27.04.10 09.06.10 21.07.10 01.09.10 13.10.10 23.11.10 05.01.11 16.02.11 29.03.11 11.05.11 22.06.11 03.08.11 14.09.11 09.11.11 MICEX LSE Линейная (LSE) 57.97% 10.04%* 31.99%

Shareholder structure

Russian Federation GDR holders Other shareholders

Daily trading volume, USD mln

• traded on MICEX;
• having the highest weight in the MSCI Russia index among all

electric utilities.

Russia’s blue-chip company with shares:

• RusHydro DRs are traded on the regulated sector of the IOB of

the Main Market, London Stock Exchange and OTC QX (U.S.);

• DRs have substantially increased liquidity over the last 12

months

• One of the biggest DR program among Russian companies

ADR level 1/GDR 144A

Far East

• Non-price zone. The tariffs for individual power plants are set by local regulators on on “cost+” basis
• Excess output of Zeyskaya and Bureyskaya power plants is sold at a higher (than regulated tariffs) price to InterRAO

for export to China

• The return on investment for new capacity planned for construction via the mechanism of bilateral contracts with large

industrial consumers (mining, infrastructure companies)

• The regulatory landscape in the Far East may significantly change as RusHydro acquires RAO ES of the East – the

vertically-integrated holding with 8.8 GW of capacity

26

Regulatory profile

91% 97% 100% 9% 3% 2009 2010 2011E

Regulated Unregulated

60% 45% 25% 40% 55% 75% 2009 2010 2011E

Regulated Unregulated

73% 59% 42%

33% 27% 14%

27% 41% 58% 2009 2010 2011E

Regulated (total) Regulated (investment component) Unregulated

Europe

• Electricity sales are almost unregulated with a marginal share sold under regulated tariffs to households. Spot market

prices are driven by gas-fired generation

• Most of capacity sold at the marginal market following annual auctions (KOM). Since price caps are applied, the

market is semi-regulated, which may be a temporary measure. Investment component for RusHydro in the amount of RUR 12.9 bln is included in these prices.

• RusHydro will commission 1.4 GW of new capacity in 2011-2014 under capacity delivery contracts that guarantee

adequate rate of return

Siberia

• Electricity sales are almost fully unregulated with a marginal share sold under regulated tariffs to households. Spot

market prices are primarily driven by coal-fired generation, but the abundance of hydro generation drives the prices down as compared to European Russia

• As of 2011, capacity sales of hydro-producers are fully regulated, which can be seen as a temporary measure, but the

regulator has not indicated any deadline for lifting this limitation

* - conservatively sales via KOM are qualified as regulated sales

Revenue from sales Physical sales of electricity Physical sales of capacity*

Europe

15 GW

Siberia

13.7 GW*

Far East

13 GW