En+ Group International PJSC, the power and aluminium company formerly controlled by billionaire Oleg Deripaska, is looking to find new customers for its electricity as it reboots after the lifting of US sanctions.
While En+’s four hydro power plants in Siberia are the main suppliers of electricity to its United Co Rusal unit, it’s weighing options to supply other projects, said chief executive officer Vladimir Kiriukhin.
The company, which said on Tuesday that it has switched its domicile to Russia from Jersey, is also tapping cheap power to develop data centres.
“The sanctions did not affect our strategy,” Kiriukhin, 63, said in his first interview to international media since the restrictions were lifted on En+, power unit EuroSibEnergo and Rusal in late January. “Diversification and the search for the new customers for the power division is also an important area for us.”
Kiriukhin, a 20-year veteran of En+ units, took over last November as Deripaska agreed to reduce his ownership and relinquish control over the companies in return for the US Treasury lifting sanctions.
Now Rusal, the world’s No 2 aluminium producer, is working to win back lost contracts, while the new CEO seeks to put the businesses on a sounder footing.
“The power division suffered from sanctions to a lesser extent, mostly reputationally,” said Kiriukhin, who has PhD in engineering. As the result, En+’s power division’s first-quarter earnings before interest, taxes, depreciation and amortisation was higher than the aluminium business.
With water levels in Lake Baikal and on the Angara and Yenisey rivers in Siberia returning to normal for the first time in several years, En+’s power plants are generating more electricity.
That not only provides cheap, green power to Rusal, but offers bigger potential for sales to third parties. That may include gold miner Polyus PJSC’s new Sukhoi Log mine, Kiriukhin said. Polyus’s press service said there are currently no talks on the issue.
The company also has projects to build several mini hydro power stations on small mountain rivers, with a total capacity of 200 megawatts. The first will be the 8 megawatt Segozerskaya plant, which will supply an 8bn-rouble ($125mn) data centre, developed by DCLab Karelia under an accord with Rusal.
En+ has a deal to provide 100 megawatts of power to Bitriver, which built a data centre close to Bratsk hydro plant. “This is the largest deal of its kind on the Russian market,” said Kiriukhin, adding that Chinese and US companies have shown interest in building similar facilities. En+ has also formed a joint venture with Bitriver to provide computers racks in the centre to so-called crypto miners.
En+ is also improving the efficiency of its hydro power stations as it partially replaces coal-fired plants. That will cut greenhouse gas emissions by 2.8mn tonnes per year, the CEO said.
The company is working to cut pollution from its small coal division, which provides power to homes in the Irkutsk region, Kiriukhin said. Flooding last month caused damage to some of those assets, as well as houses in the area, but En+ has restored power in the area and is helping employees who were affected. The impact on the company’s profit won’t be large, he said.
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