Transcript of the beginning of the meeting:

Vladimir Putin: Colleagues, good afternoon. In recent days, some regions have been experiencing difficulties with power supply to cities and towns. The worst hit are the three regions whose leaders are here today. Although I must say that in St Petersburg, where we are now, and in the Leningrad Region, things are also difficult. But things are particularly difficult in Tatarstan, the Ulyanovsk Region and the Samara Region.

Due to bad weather – snowfall – wires have frozen and broke, and 390 localities that are home to some 120,000 people have been left without power. Some 280 socially important facilities are without power, and traffic is almost paralysed on some of the roads.

I know that you have taken measures in response and that work is underway to restore the power supply. Emergency Ministry teams are carrying out some of the repair work, where needed. Socially important facilities connected to independent power sources in some territories had to declare a state of emergency. I know that many of the transmission lines and substations have been restored. Work is in progress, particularly in remote regions. This demands our attention.

First, we need to create a mobile reserve. We have discussed this many times. Let's talk about what has been done in this regard. We absolutely need to make an inventory of all power grid facilities, the entire energy sector, and to verify that all vitally important systems are operational.

Let's talk about what is happening now, what is being done and what else we need to do in your opinion, as well as what help you will need from the Russian government to restore infrastructure as quickly as possible, in the shortest amount of time, and get through this difficult time. Please, let's start with Tatarstan.

Rustam Minnikhanov (president of the Republic of Tatarstan): Mr Putin, 14 districts were affected. A total of 2,670 cable supports fell. This is the biggest problem, and recovery of some 300 towers per day is in progress.

Vladimir Putin: How many in total?

Rustam Minnikhanov: 2,670 supports. We have organised 132 brigades, 10 operational teams and mobilised more than 500 pieces of equipment. We are using a helicopter to find where the problems are.

As of today, there are two districts remaining out of 14, about 84 localities, but if taken as a whole, we fixed all the system lines in one day. Power has been restored in the large settlements, regional centres and cities. Only the small towns remain. But we hooked up large and small generators everywhere. During this period, we purchased approximately 350 generators, so all social and cultural facilities have power.

Vladimir Putin: The hospitals have power, don't they?

Rustam Minnikhanov: Yes, the hospitals have power. We restored power to all hospitals first. We had great support from the Interregional Distribution Grid Company (IDGC) – we borrowed some of their equipment. The Energy Ministry gave us substantial support – it provided 225 MW every day from Samara, because our lines were not yet operational. Sergei Shmatko (Minister of Energy of the Russian Federation) spoke with us and we worked in conjunction with him.

What is the situation today? Two districts remain. According to our plan, we need to restore the 503 supports, and we plan to complete all of this major work by Sunday evening.

In general, we have props, wires and all the equipment available. We have organised the personnel. I think this is a great lesson in that the standards that are applied to the power lines cannot withstand the freezing weather we've been having.

Vladimir Putin: This is what happens every year in Sochi, in the mountains.

Rustam Minnikhanov: We agreed with Sergei Shmatko to hold a meeting about what needs to be done in the future. This is also a great lesson for us to create a reserve. We used the high capacity generator, took nine generators from the Defence Ministry, and KamAZ used its manufacturing generators. All core facilities were provided with water and sewer services.

Vladimir Putin: Thank you. How are things in Samara (addressing Vladimir Artyakov, governor of the Samara Region)?

Vladimir Artyakov: Mr Putin, the situation in our region developed along similar lines. Only it was on a smaller scale, of course. A total of about 15,000 people were affected. And, of course, the number of fallen supports was not measured in the thousands, but around 200 supports. But 860 km is also sizable. What did we do in the first few days? Of course, we set up headquarters. We were tasked with ensuring the operation of socially significant facilities. These are, above all, kindergartens, schools, hospitals, support services, domestic institutions and so on.

We accomplished all of this, and there was never any disruption of gas supply, heating, or cold water, so we did not have to thaw out anything, which could have then caused us some trouble in terms of recovery. We did not allow this to happen.

Within two to three days...

Vladimir Putin: This would be the worst thing. If this happened, it would have been necessary to simply relocate people and re-lay power lines afterward.

Vladimir Artyakov: Yes, yes, all the boilers were operating without interruption, gas was supplied and is still being supplied without interruption. Today, the situation is completely under control. We anticipate by the end of the day on December 12 to fully restore all the supplies, power supply to all localities. As of today, we still have about 6,700 people without power in the affected area.

But then the process has to be repeated – we are rebuilding, then the stormy winds, rain and first frost start, and of course, the supports cannot hold up. But we have everything under control. We have over 300 people working.

Vladimir Putin: You have old power lines?

Vladimir Artyakov: You know, there are both old and new ones – both kinds are equally affected. Mr Minnikhanov is absolutely right – the supports can only withstand a vertical load; under a horizontal load, they fall like dominoes. Such a structure was provided, and the layer of ice on the wires is 20 mm at its thinnest, up to a maximum of 10 cm thick. The supports cannot withstand the load because of the crosswind.

As of today, we have the situation under control. We have emergency crews working at all the sites – more than 300 people. Mobile power substations will be used in the event of any disruption. We are using diesel generators and gasoline generators.

Vladimir Putin: Where did you get them?

Vladimir Artyakov: We had our own, and we got additional ones from the Emergencies Ministry. So we're fully supplied. As I already said, we are aiming to rectify the situation by midnight on Sunday.

As of today, as I said, there about 6,700 people without power in the affected area. But again, another emergency occurred – five supports fell, and we could not stay on schedule. We will rectify the entire situation by tomorrow.

Vladimir Putin: The Ulyanovsk Region was harder hit than Samara.

Sergei Morozov (governor of Ulyanovsk Region): Mr Putin, it just so happens that on December and 5 and 6, two severe atmospheric fronts came to Ulyanovsk at the same time and covered the six districts on the border with the Samara Region and Tatarstan to begin with, and then covered the town of Dimitrovgrad. We were forced to shut down all six nuclear reactors, because power supply was disrupted. Then there was a massive storm, and it reached the point...

Vladimir Putin: But the reactors themselves weren't threatened?

Sergei Morozov: No, none of them. Everything there went as planned, and there were no issues. In total, as of December 4, about 13 municipalities were affected – more than one million people. We immediately got into close contact with Nikolai Shvets (director general of IDGC Holding). After switching over to the reserve sources of energy, we were able to normalise the situation in the city of Ulyanovsk and in several municipalities. But in any case, we were forced to declare a state of emergency in the six municipalities – around 127 localities with a total of 180,000 people.

We had 1,434 downed supports. Around 421 kilometres of power lines were affected.

Vladimir Putin: What sort of wind was it?

Sergei Morozov: Mr Putin, here is a photo. There was a really terrible storm. All of our stations were turned off, including cellular base stations. We immediately identified several tasks. We involved all of the resources available – the Emergencies Ministry, backup power, and we asked companies for help. We set up approximately 100 generators and did not allow the heating system to freeze over. We also provided food to the population. People started to panic a bit when some gougers came on the first day and, seeing that there were bread shortages, drove in several trucks and tried to sell bread and drinking water at three times the price. Police stepped up patrols, caught these scoundrels and now they're being held administratively liable.

On December 6, we tried to normalise the situation, but the weather began to change again, and another 500 supports fell. In general, we started repairs on December 8. To date, out of 180,000 people in 127 localities, there are 60 communities, home to 19,423 people, where repairs are still needed

Vladimir Putin: That's still a lot.

Sergei Morozov: I held a meeting today, and I think that we will fully restore 32 of these 60 communities. The total population of these 32 communities is 7,500. And tomorrow – another 28 settlements with 12,000 people. So we are confident that unless the weather turns bad, we will more or less finish... Maybe, some mopping up will still be needed, but I think in the best case scenario, we will deal with all of these issues as early as Monday.

Vladimir Putin: Alright.

Sergei Morozov: But the lessons to be learned are major, Mr Putin. I agree with Mr Minnikhanov that we prepared for the heating season, and we bought generators, but no one expected them to work in such a quantity and so consistently.

And the supports that cannot withstand the weather... they are from 1961! Nikolai Shvets and I arrived at the scene where the main supports fell. We thought we'd see how they were repaired. But right in front of a support snapped like a twig! The service life of these supports is 25 years, and they had to be replaced back in 1986, but we can say that they stood for a second term. This is probably one of the main problems that must be addressed.

Vladimir Putin: How is the grid company operating, what kind of relations you have with the regions and with other services that need to be involved in solving problems of this kind?

Nikolai Shvets: Mr Putin, over the past 24 hours, out of 69 regions of the Russian Federation, for which IDGC Holding operates a sub-distribution grid, six had technical breakdowns, with a power outage of 100 MW affecting 140,000 people. Tverenergo and Lenenergo were affected by the weather. Nurenergo and Tyumenenergo had technological breakdowns. All the breakdowns were repaired by the set deadline, and they are being repaired under the supervision of the Energy Ministry and in close cooperation with the leaders of the constituent entities and the Emergencies Ministry.

As with the breakdowns that occurred in the Volga IDC – that's the Samara and Ulyanovsk sub-distribution grids – the long-term restoration of the entire distribution grid depends on several factors. First of all, these are the conditions on-site.

Firstly, the area in which the Ulyanovsk and Samara regions are located has the second-highest incidence of black ice formation. In general, Russia has seven levels of zoning. Naturally, the design of power lines and other elements takes in account the calculations made according to such data. What is happening now is an abnormal phenomenon. It is further complicated by the fact that it has lasted for an extended period – for five days, the temperature is zero degrees Celsius and black ice is constantly forming.

Secondly, the scale of the problem extends to the surrounding areas. The the icy conditions make it difficult to move additional resources and teams there. It is also makes it difficult to deliver supplies.

The second factor is the state of the equipment. Yes, indeed – the newest supports currently available in the disaster area are 27 years old; in other words, it is a power line that is well past its service life.

The most seriously affected power line, which has been in service twice as long as its service life, is from 1962. Naturally, this violates the carrying capacity of the elements on the one hand, and on the other, it was not designed to bear the impact of black ice.

Also, another hazard was revealed during the inspection: the station equipment is also completely iced over, and carrying out switching operations is extremely difficult.

Another problem is the content of the safety zones. Nearly 800,000 kilometres of power lines in Russia are located in woodlands. Over the past 20 years, difficulties have developed in servicing these safety zones, all the more so since previously, it was not expected that the lines would be in operation for such a long time. The trees have grown, which requires the expansion of these zones.

Vladimir Putin: What's the problem?

Nikolai Shvets: The problem is with regulations. We've drafted...

Vladimir Putin: You can't cut down the trees?

Nikolai Shvets: ...with a federal agency. But there are problems.

Vladimir Putin: Tell me exactly what you mean.

Nikolai Shvets: We have submitted a proposal to simplify the procedure for ownership registration because there is a large amount of unregistered property. And with the new Forest Code, it is a real problem to cut down and use these trees. We must file a number of documents in order to carry out this work.

Vladimir Putin: There should be order here. There must not be any reckless clearance, but everything that is needed to meet the technical requirements should be ensured. Draft the proposals.

Nikolai Shvets: Mr Putin, we have started to develop a programme that is designed to last for at least five years, aimed at removing the problem with safety zones and trees falling on power lines. We will continue to work on it.

During the relief work, we established headquarters in all regions, opened emergency reserves and immediately prepared contracts for the replenishment of material resources. For the extent of damage, especially in the Ulyanovsk Region, is enormous. The investment programme for 2010 stipulated replacing 400 supports, but now we need to replace nearly 1,100 supports. In other words, it turns out that in this short time, we have to complete two annual investment programmes in Ulyanovsk sub-distribution grids.

Teams were formed – we are grateful to them – and the contractors responded immediately, so that within two days we had 74 teams working in the Ulyanovsk Region, and 31 teams in the Samara Region. We were ready to provide assistance to the Republic of Tatarstan, but only the material aid has been delivered and no teams have been sent there yet.

In this regard, we would like to thank you for your directive to develop a restoration programme – you issued such a directive last year. We submitted it to the government. Igor Sechin, the chairman of the Governmental Commission on the Electric Power Industry, scheduled a meeting to consider this programme for December 17. And after it is approved, we are ready to begin implementing it starting next year. It is designed for 10 years and stipulates replacing all the equipment that is past its service life. The funds required are enormous – 2.8 trillion roubles.

Vladimir Putin: How much?

Nikolai Shvets: Two trillion, eight hundred million roubles over 10 years. But we now estimate that due to the transition to RAB regulation, income from the tariffs could be used for the renovation programme to the amount of about 350 billion roubles. Borrowed funds would be 1.2 trillion roubles. Savings in 2013 due to the installation of new equipment will be somewhere around 500 billion roubles. But we're counting on aid of somewhere around 800 billion roubles. If we get the money, then this programme will be implemented within 10 years. If that is not possible and no aid will come from the federal budget, then, of course, the term of the programme will have to be extended, perhaps to 15-18 years. But such a programme will be implemented. We now know where, how and which equipment we need to replace. The head of RES knows how much equipment they have to replace within the next 50 years in order to get rid of the equipment that is past its service life. But the replacement of this equipment will be energy efficient and will take into consideration the challenges we are now seeing in relation to the distribution grid.

Another line of work, which you mentioned earlier today, is bringing accounts into order and inventory. There were 2,154 local grid organisations operating in 69 regions, apart from IDGC Holding distribution grid affiliates. These organisations belong to local governments, stakeholders, municipalities and private owners, and a large number of them are derelict. This is the kind of work we're doing. In 2010, we have already purchased or rented 50 such organisations, including ones deemed derelict by municipal authorities.

We are ready to work on such a programme in close cooperation with the leadership of constituent entities that are ready to implement it. I think that when a safety zones programme, a renovation programme and the programme to consolidate and improve the management of the distribution grid are implemented, we will have a more reliable system that will provide both the economy and the population with high-quality power supply services.

Vladimir Putin: Obviously, we need a programme to replace obsolete equipment. It goes without saying. We only need to understand the sources and timing of the programme. We need to think about this. Because everyone present here understands that what a trillion means for the nation. So...

Nikolai Shvets: But this will be over a period of 10 years, Mr Putin.

Vladimir Putin: I understand.

Nikolai Shvets: We have a commissioning date, we have a manual which defines the service life and we have the real conditions; in other words, cheating or making mistakes here would be difficult. We spent a year developing it and calculating the costs.

Vladimir Putin: Alright. Let us look at it again more closely. We will determine, I reiterate, both the timing and sources of funding. We'll look at everything together. Regional leaders have now set deadlines for relief operations after these accidents. In Tatarstan, everything should be done by the close of business tomorrow.

Vladimir Artyakov: Same here, Mr Putin.

Vladimir Putin: ...and also in the Samara Region and the Ulyanovsk Region...

Sergei Morozov: Everything will be ready by Monday at the latest.

Vladimir Putin: Monday is the final deadline. What do you think? Is it realistic?

Nikolai Shvets: Mr Putin, we have identified priorities for restoration, and most important is division of power transmission, which will enable power supply to businesses and homes. And secondly, we have to restore the elements that increase reliability, because when this concerns the population and supplying power to the population – it's realistic. And as far as making the system as reliable as it was designed to be, this will take more time, probably about five days.

Vladimir Putin: I see. But this will be done under normal operating conditions?

Nikolai Shvets: Yes.

Vladimir Putin: And power will be restored to the main consumers during this period, tomorrow. And do I understand correctly that the final deadline in the Ulyanovsk Region is Monday? Do you have any problems in interacting with regional authorities or with colleagues from other companies or agencies?

Nikolai Shvets: No, there are no problems. As a matter of fact, the work was very well coordinated with the federal government and heads of constituent entities during this period. We realise that we're responsible for reliable power supply.

Vladimir Putin: Good. Let us agree that in this time frame, that is, by the close of business tomorrow, at least by the close of business on Monday, the work must be completed in full, not just in the main.