The Gazprom Management Committee has reviewed the issue related to the prospects for gas and energy saving technologies development and introduction, as well as their impact on the Russian fuel and energy balance optimization.

The specialized subdivisions were entrusted with evaluating the potential of gas saving by Gazprom Group’s energy companies and further participating in the modification of the draft legislative act “On energy saving and raising energy efficiency”. A task was also given to elaborate proposals on adjusting the gas consumption planning system for the internal technological needs, streamlining the measures for energy saving stimulation, as well as setting the requirements for energy efficiency of the equipment being purchased.

The Management Committee tasked the specialized subdivisions to prepare the materials for addressing this issue at the Board of Directors’ meeting.

The Management Committee also considered the issues related to the preparation for Gazprom’s ordinary General Shareholders’ Meeting and the participation of the Members of Company’s Management Committee in the governing bodies of other organizations (the issue will be introduced for the consideration by the Board of Directors).

Background:

At present the State Duma of the Russian Federation has adopted the draft Federal Law “On energy saving and raising energy efficiency” in the first reading covering administrative and financial measures of energy saving encouragement, as well as support to energy saving projects. Gas saving projects are identified by the document as the prioritized ones. The total gas saving potential in Russia is evaluated at 172-177 billion cubic meters (around 40 per cent of the domestic gas consumption).

At the same time, there exists a whole range of serious obstacles in Russia, hampering execution of the existing energy and gas saving potential. These, first of all, include lack of motivation for energy saving, the absence of provisions encouraging energy saving in pricing, tax and customs policies, the inefficiency of the regulatory and legal framework, and, as a consequence, the insufficient investment inflow into energy saving projects. Meanwhile, unreasonable prices for primary energy carriers are the most significant obstacle.

Gazprom implements the Energy Saving Program for 2007 through 2010, which will allow saving in the order of 11 million tons of fuel equivalent including 10.4 billion cubic meters of natural gas, some 1.3 billion kWh of electric energy, 1.2 million Gkal of thermal energy and 30 thousand tons of fuel equivalent of diesel and boiler-furnace fuel.