STRATEGY FOR SUCCESS

At the heart of the success of any company, enterprise or organization lies its management's choice of correct development strategy at the outset. Typically, such programmes include both short-term goals and projects for long and steady growth. Here, five years is a symbolic time to take stock and assess future prospects.

Bakielektriksabaka, a company important for all Bakuvians, has now turned five. In 2006, taking over the "reins of power" of the metropolitan electricity network, the company's management was aware that Baku's inhabitants expected radical and significant changes to energy supplies, as they were tired of constant blackouts in winter and barely lit streets at night and - even more so - of mindless excuses for all the problems by the foreign company that preceded Bakielektriksabaka. Therefore, the strategy for managing the power network had to be focused primarily on the urgent elimination of existing shortcomings and then, stable existence and development.

Today we can definitely say that the main goals set five years ago have been achieved - there is no longer an acute shortage of electricity in Baku, no more frequent blackouts and, more importantly, it is hoped that the situation will only improve in the future.

Reconstruction and development

Over the past five years, the capacity of JSC Bakielektriksabaka's electricity distribution network has increased by almost 53 per cent - reaching 4,808 MW, which has naturally had an effect on the quality of power supplies to the capital. After all, Baku has been growing incredibly quickly in recent years - high-rise apartment complexes are under construction, new businesses are starting to operate and bridges and roads are being built. All this is an additional burden on the network. By the end of the year, it is planned to increase network capacity to 4,560 MW.

According to Bakielektriksabaka chief, Baba Rzayev, work is being carried out to the order of President Ilham Aliyev to improve the quality of power supplies to the capital. To this end, the task of upgrading the network infrastructure is being successfully implemented, as we can see from the report on work carried out in nine months of this year. For example, work is under way to reconstruct the 110/35/6 kW Badamdar substation, which is of great importance for energy supplies to the central part of Baku and, in particular, buildings of national significance. The station's transformers have already been replaced by more powerful ones. Work is also underway to reconstruct the Musfiq and Dagliq substations. A building has been constructed for the 110/35/10 kW Liman substation, which is part of the 110 kW network, and work is continuing at the Icari Sahar substation. In order to reduce the load on the Binaqadi and Darnagul-2 substations, the Xocasan substation was built in the Binaqadi and Qaradag districts of Baku, and it is planned to commission it by the end of this year.

Substation No 227, which provides electricity to most of the capital, has been completely rebuilt. During reconstruction, the substation was equipped with a new type of electrical equipment.

Major repairs and maintenance work were carried out at the 110-kW substations YBNZ-1, YBNZ-2, Gunasli, Bakixanov, Radiozavod, Hazi Aslanov and MKZ. Overall, in the first nine months of this year, repairs were carried out at 20 substations with a capacity of 110 kW, major repairs at five while 26 were opened on a turnkey basis. Repair work was carried out on 30 km of 110-kW overhead lines.

Numerous substations in the 35-kW network were also reconstructed and set, and new substations Nagornyy Park, Nardaran-1, etc. were built. Overall, current repairs and maintenance work were carried out at eighty 35-kW substations, major repairs were carried out at 15, 75 were overhauled on a turnkey basis, and the insulation in transformers was checked. Some 100 km of 35-kW overhead transmission lines were reconstructed and, during this work, new lines (8.1 tonnes) and cables (45 km) were laid.

Similar work was carried out on the 0.4, 6 and 10-kW networks. All this, of course, will help Bakielektriksabaka in the autumn-winter period, for which the company is preparing with great care. For example, in preparation for the cold season, 30 transformers in seven districts of the capital were replaced by more powerful ones and power supplies to residential buildings were improved. Great attention is being given to the districts and suburban towns as part of the programme for the socioeconomic development of Baku city settlements. By carrying out work to reconstruct and rehabilitate the infrastructure there, it proved possible to reduce losses from the power network.

By the way, measures to improve the calculation of electricity consumed also help to achieve this aim (reducing the amount of losses). An automated Elster Metronica counting system has been installed at substations, and the old meters have been replaced by electronic ones in order to maintain accurate records of electricity purchased from Azerenergy. Thus, technical losses from the network were reduced by 4.1 per cent, and the collection of payments for energy consumed significantly increased.

In other words, although the amount of electricity purchased in eight months of 2010 was 370.9 million kW/h, less than in the corresponding period of 2008 and 56.6 million kW/h less than in eight months of 2009, payments rose by 20 4 million manats compared with 2008 and by 14.9 million manats compared with 2009. In addition, due to measures taken in the low voltage network in eight months of this year, payments made by the population totalled 78.8 million manats, which is 45 per cent more than in 2008 and 10 per cent more than last year.

In fact, 600,000 meters have been installed since 2006. Let us recall once again that Bakielektriksabaka only installs electronic meters, which ensure the correct recording of electricity. At the same time, it is harder to interfere with electronic meters than with mechanical ones.

Bright future

However, it should be noted that Baku is developing and expanding rapidly, and so Bakielektriksabaka needs new solutions and new projects to maintain and improve the quality of its customer services. To this end, the company's information system has been fully updated and its efficiency and functionality improved.

However, it should be noted that new technology requires the training of personnel to ensure the smooth and efficient operation of the network. To this end, in 2007, Bakielektriksabaka sent some of its employees for training in advanced educational centres of the CIS and Turkey. We must say that the management of the network devotes sufficient attention to enhancing the skills of its specialists, which is why more than 610 people have received training at the company's educational centre. 266 of them are engineers and 344 are workers. Twenty-five people took English language courses to become better acquainted with the experience of the world's leading energy companies. Moreover, even away courses for the installation of electric meters and recording energy consumption were organized.

Compulsory training applies particularly to new employees of Bakielektriksabaka, who, incidentally, become such only after approval by a special recruitment commission to evaluate the professional skills and abilities of applicants. There are quite a few people willing to join the ranks of energy workers, as the network's management focuses on the social status of its employees, as exemplified by orders to raise the average salary in the company by 20 per cent. We also note that wages and equivalent payments total 21,869,500 manats for 2010.

Bakielektriksabaka is now quite a successful company; it has not only implemented its minimum objective - to provide uninterrupted electricity to citizens of Baku, but also makes a profit from its activities, which was almost unthinkable a few years ago. Thus, according to a report by the auditing company Deloitte & Touche, from 2007-09 the company's net income was 63,776,119 manats, and in 2007-2010 - 75,931,660 manats. During this period, the company transferred 15,450,600 manats to the State Social Security Fund in social insurance fees.

In other words, today we can say with confidence that the company's strategy for the development of the capital's power network, selected five years ago, has totally justified itself and has provided the basis for its sustained existence for many more years.