The Address to Shareholders
1.	General information
2.	TGC-1 in the economic life and industry
3.	Production
4.	Sales activities
5.	Fuel supplies and procurement
6.	TGC-1 investment activities
7.	Financial performance
8.	Securities and corporate governance
9.	Social responsibility
10.	Risk management
11.	Key development areas in 2012
12.	Appendixes

In 2011, the GDP continued to grow, and by the estimate of the Federal State Statistics Service it reached 4.3 %. In 2011, the Russian economy exceeded maximum pre-crisis parameters of mid 2008, despite the growing uncertainty of external conditions. In 2011, industrial production increased by 4.7 %. In 2011, inflation in the consumer market dropped to 6.1 %, which is the lowest rate since 1991.

After the increase in electricity prices in early 2011, the Government of Russia took exceptional measures in order to reduce the electric capacity prices in the wholesale market. As a result, according to the estimates of the Russian Ministry for Economic Development, end-user electricity prices for all consumer categories increased by 7 % from January to November versus 19.5 % the year before. From March to November, the prices decreased by 7.8 %.

As of the end of 2011, the installed capacity of power plants of the UES of Russia totaled 218,235.8 MW: the increase was mainly due to the commissioning of new capacity of 4,688.3 MW and renovation of the existing capacities of 1,507.2 MW. The installed capacity of the North-West IPS increased by 4.1 % compared to 2010 and amounted to 22,466.7 MW.

In 2011, the total electricity generation of the UES of Russia, including generation by power plants of industrial facilities amounted to 1,019.4 billion kWh (1.5 % growth compared to 2010). OGK generation amounted to 350.1 billion kWh (a 3.7 % growth compared to 2010), TGC-1 generation amounted to 253.0 billion kWh (a 0.4 % growth). The North-West IPS electricity generation in 2011 amounted to 105,900 million kWh or 10.4 % of the overall generation of the UES of Russia. North-West IPS electricity generation grew by 4.4 %.

The actual electricity consumption in the UES of Russia for 2011 amounted to 1,000,069.5 million kWh, which is 1.1 % more than in 2010. The North-West IPS consumption decreased by 0.2 % and 92,554.1 million kWh were produced.

The annual maximum demand from the consumers of the UES of Russia was registered at 6 pm (Moscow time) on 20 January 2011 at the frequency of 50 Hz at 147,769 MW. The peak load of the power plants of the UES of Russia was 149,603 MW.