E.ON Russia has signed a property insurance contract for 2013. Among other additional insurance risks, the contract also covers by the risk of process outages.
"E.ON Russia has signed insurance contracts to cover forced interruptions of the production process, so-called unplanned outages. For generation companies, it is extremely disadvantageous to have unscheduled outages of power units. We are trying to hedge against this risk", said Ulf Backmeyer, Deputy Director General, Economics and Finance.
This insurance covering the continuity of the production process will apply to the entire generation capacity of the company including combined-cycle generation units commissioned in 2010-2011.
According to the existing laws, during unplanned outages of power units, generation companies are paid capacity payments reduced by applying reduction ratios.
E.ON Russia has been insuring the risk of interruptions in the production process since 2011. This type of insurance reduces the risk of failure to achieve the planned EBITDA values.