Key international energy companies and investors are expressing interest in Russia’s electricity liberalization programme in spite of concerns over perceived market risks in the country.

National electricity utility RAO UES has said that groups such as International Power, Mitsui, RWE, Evonik, Norilsk Nickel Mining and Metallurgical Company and Prosperity Capital Management all showed interest in purchasing shares in TGC-2, the latest territorial generating company to be privatized. UES has also privatized TGC-6 and made a further share issue in TGC-10.

Russia’s Sintez Group was the successful bidder in the auction to acquire a 33 per cent stake in TGC-2, which owns 16 combined heat and power plants in northwest Russia. Half of the shares will be transferred to Germany’s RWE under an agreement with Sintez.

The RAO UES tender commission also named IES, a Russian energy investment company, as the winning bidder in the auction of a 34 per cent stake in TGC-6. The sale has raised $463 million, which will be partly used to finance TGC-6’s investment programme.

The sales of government-held stakes in the territorial generating companies follows Enel’s purchase of further shares in OGK-5, one of six federal generating companies undergoing privatization. Enel is to invest more than EUR2 billion in Russia over the next five years, according to the Financial Times.

Companies such as Enel and RWE are attracted to Russia due to the size of the market and its growth rate, but there are concerns over Gazprom’s control of the gas market and risks surrounding electricity price liberalization.

Finland’s Fortum recently increased its stake in TGC-10, winning the share auction for a 29 per cent stake in the company. It’s ownership in TCG-10, which operates with 3000 MWe and 15 800 MWth in the Urals region, now stands at 76 per cent.