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Earlier this month, Cisco and the Federal Grid Company of Russia signed a memorandum of understanding (MOU) that establishes a long-term collaboration to improve the reliability and efficiency of the country’s power grid.

This MOU is the latest concrete step that Cisco has taken to help transform Russia’s energy infrastructure. Just about a year ago, Cisco set the mark by announcing a $1 billion investment in Russia over the next decade to drive entrepreneurship, sustainable innovation and energy efficiency. The investment includes the development of a collaboration model with Russian business in verticals such as smart grid.

So, what makes Russia ripe for smart grid transformation? As the world’s third largest consumer of energy, Russia’s energy infrastructure requires modernization, a fact that President Medvedev’s government is confronting proactively and aggressively. The country’s distribution infrastructure loses 12 percent of transmitted energy -- worth $10Bn -- every year.  This has a huge economic impact on the country as well as an environmental impact on the world.  Of course, much of what causes this inefficiency can be addressed through today’s smart grid technologies; it’s a matter of enabling the transformation through integration of those technologies on the power grid.

This is why Cisco is aiming to establish a complete communications fabric based on IPv6 standards that marries information technology with energy technology. Cisco is providing solutions for complete, resilient and two-way communications throughout all critical points of the energy infrastructure, from data centers and substations through neighborhood area networks and within homes. The communications fabric , much like an operating system for smart grid, will serve as the innovation  platform for new smart grid applications, the kind like we will explore with the Federal Grid Company of Russia.

A year out from our initial commitment to investment in Russia, we are excited about the potential of the collaboration with the country and have seen the potential of the organizations partnering to develop innovative smart grid technologies and bring them to market. There’s still a great deal of work to do, but we’re off to a strong start.

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