Moscow. 1 October 2004. Today, the state registration has been completed at the new companies established as a result of reorganization of OAO "Bryanskenergo" and OAO "Belgorodenergo":

• OAO "Bryansk Energy Management Company";
• OAO "Bryansk Retail Company";
• OAO "Bryansk Generation Company";
• OAO "Belgorod Retail Company";
• OAO "Belgorod Heat Energy Company".

Thus, by now the unbundling by lines of business has been completed in five regional energy companies of RAO "UES of Russia" Holding Company: OAO "Kalugaenergo", OAO "Voronezhenergo", OAO "Belgorodenergo", OAO "Bryanskenergo", and OAO "Pskovenergo".

On 28 September 2004, the Management Board of FST of the Russian Federation, OAO "Belgorod Retail Company" and OAO "Bryansk Retail Company" were granted the status of wholesale electricity market participants. At the same time, separate tariffs were set for the power generation, grid, and retail companies in each region of Russia.

OAO "Bryanskenergo" and OAO "Belgorodenergo" were reorganized in accordance with the basic restructuring plan approved by the Board of Directors of RAO "UES of Russia" in the spring of 2002. The plan provides for the reorganization of energy companies through unbundling by lines of business,–-electricity generation, transmission, and retailing, with the original ownership structure of the companies preserved. The transfer of the functions of one-man executive bodies (CEOs) to the management companies created in Bryansk Region and Belgorod Region is expected to take place in January 2005.

Besides, the general meetings of shareholders held on 30 September 2004 at four regional energos. According to preliminary data, the shareholders of OAO "Arkhenergo", OAO "Novgorodenergo", OAO "Stavropolenergo", and OAO "Tulenergo" approved the resolution to unbundle their companies by lines of business, with the current ownership structure preserved in the newly established companies.

Under the Russian laws, a decision to reorganize a company requires approval by at least 75% of shareholders present at a meeting. In all four regional energos, the resolutions were approved by over 99% percent of the vote.

Thus, to date, resolutions on reorganization have been approved at thirty-six regional energy companies of RAO "UES of Russia" Holding Company.