Russia to place new restrictions on foreign energy companies

Russia’s Energy Ministry intends to prohibit foreign companies from generating information in their technical performance monitoring centers about the operations of gas turbine equipment that they supplied to Russia, officials at the ministry have announced.

!!!!!!!!!!!!!!!! UAA1 !!!!!!!!!!!!!!!

Currently, monitoring activity enables foreign suppliers to provide to operators of power plants services within a short period and to receive technical data for improvement of their turbines. According to the Ministry of Energy, the reason for making such decision is attributed to the fact that the strategically important information should be available only to Russian companies.

The move means that Siemens, Alstom and GE will not be able to monitor gas turbines that they previously sold to the Russian Federation.

All the details related to this decision were worked out by an interdepartmental working group on the development of an import substitution program for power engineering equipment in the field of gas turbine technology, the Energy Ministry said.

According to the ministry, about 70% of all Russian gas turbines that are being monitored outside the Russian Federation are owned by Germany’s Siemens and U.S, company General Electric, with the remaining 30% being overseen by the French company Alstom, U.S. company Solar Turbines, Japan’s Mitsubishi Heavy Industries and the UK company Rolls-Royce (until May 2014, when the company sold its energy business to Siemens for EUR 950 million).

As Russian newspaper Izvestia reported, according to representatives of Siemens, Alstom, and GE, the monitoring of turbines is carried out by their own specialists at the  enterprises that bought such turbines, or the client’s personnel (depending on the contract). Siemens, Alstom and GE companies have no remote monitoring centers in Russia, so all the information is transferred to the country of origin of the equipment.

According to Alexander Smirnov, the editor of Turbine Technology magazine, service contracts (usually concluded for a period of 1 to 22 years) generate more revenues for the equipment producers than contracts for the supply of the actual gas turbines themselves. Some manufacturing companies also provide gas turbine maintenance services for external companies.

According to international practice, producing companies initially obtain the right to receive data and conduct remote monitoring of the operation of their equipment.

!!!!!!!!!!!!!!!!!!!!!!!! UAA2 !!!!!!!!!!!!!!!!!!!!!