Anatoly Chubais, CEO of UES said at the 9th annual Russian Economic Forum in London yesterday, that the Russian electricity system needs serious investments as currently in16 region the power usage exceeds the soviet times sometimes even by 25%. Russia is proposing a reform, which would attract new investment on a large scale of USD14bn by 2008/2009 via (i) share issue of existing power companies, (ii) guaranteed investments, (iii) direct private investments and (iv) project financing. Despite CEZ has already mentioned a possible project finance deal in the Moscow area we the current Russia electricity market as a great opportunity for CEZ to accelerate its growth in particular given its strong cash position and lower leverage. We view Mr. Cubais’s comments as supportive for the utilities sector and for CEZ should it announce some projects in Russia. We reiterate our Buy recommendation.