diff --git a/compiler/cli/src/org/jetbrains/jet/cli/jvm/K2JVMCompiler.java b/compiler/cli/src/org/jetbrains/jet/cli/jvm/K2JVMCompiler.java
index 030bdbf9f37..4f8f6ef7506 100644
--- a/compiler/cli/src/org/jetbrains/jet/cli/jvm/K2JVMCompiler.java
+++ b/compiler/cli/src/org/jetbrains/jet/cli/jvm/K2JVMCompiler.java
@@ -17,7 +17,6 @@
 package org.jetbrains.jet.cli.jvm;
 
 import com.google.common.base.Splitter;
-import com.google.common.collect.Iterables;
 import com.google.common.collect.Lists;
 import com.intellij.openapi.Disposable;
 import jet.modules.Module;
@@ -31,6 +30,7 @@ import org.jetbrains.jet.cli.jvm.compiler.K2JVMCompileEnvironmentConfiguration;
 import org.jetbrains.jet.cli.jvm.compiler.KotlinToJVMBytecodeCompiler;
 import org.jetbrains.jet.cli.jvm.repl.ReplFromTerminal;
 import org.jetbrains.jet.codegen.CompilationException;
+import org.jetbrains.jet.config.CompilerConfiguration;
 import org.jetbrains.jet.lang.resolve.java.CompilerDependencies;
 import org.jetbrains.jet.lang.resolve.java.CompilerSpecialMode;
 import org.jetbrains.jet.utils.PathUtil;
@@ -83,6 +83,7 @@ public class K2JVMCompiler extends CLICompiler<K2JVMCompilerArguments, K2JVMComp
             runtimeJar = null;
         }
 
+        // will be ignored later
         CompilerDependencies dependencies = new CompilerDependencies(mode, CompilerDependencies.findRtJar(), jdkAnnotationsJar, runtimeJar);
 
         final List<String> argumentsSourceDirs = arguments.getSourceDirs();
@@ -196,26 +197,26 @@ public class K2JVMCompiler extends CLICompiler<K2JVMCompilerArguments, K2JVMComp
     protected void configureEnvironment(@NotNull K2JVMCompileEnvironmentConfiguration configuration, @NotNull K2JVMCompilerArguments arguments) {
         super.configureEnvironment(configuration, arguments);
 
-        if (configuration.getEnvironment().getCompilerDependencies().getRuntimeJar() != null) {
-            CompileEnvironmentUtil.addToClasspath(configuration.getEnvironment(),
-                                                  configuration.getEnvironment().getCompilerDependencies().getRuntimeJar());
-        }
+        configuration.getEnvironment().configure(createCompilerConfiguration(arguments));
+    }
 
-        if (arguments.classpath != null) {
-            List<File> classpath = getClasspath(arguments);
-            CompileEnvironmentUtil.addToClasspath(configuration.getEnvironment(), Iterables.toArray(classpath, File.class));
-        }
-
-        if (arguments.annotations != null) {
-            for (String root : Splitter.on(File.pathSeparatorChar).split(arguments.annotations)) {
-                configuration.getEnvironment().addExternalAnnotationsRoot(PathUtil.jarFileOrDirectoryToVirtualFile(new File(root)));
-            }
-        }
+    @NotNull
+    private static CompilerConfiguration createCompilerConfiguration(@NotNull K2JVMCompilerArguments arguments) {
+        CompilerConfiguration configuration = new CompilerConfiguration();
+        configuration.putUserData(JVMConfigurationKeys.CLASSPATH_KEY, getClasspath(arguments).toArray(new File[0]));
+        configuration.putUserData(JVMConfigurationKeys.ANNOTATIONS_PATH_KEY, getAnnotationsPath(arguments).toArray(new File[0]));
+        return configuration;
     }
 
     @NotNull
     private static List<File> getClasspath(@NotNull K2JVMCompilerArguments arguments) {
         List<File> classpath = Lists.newArrayList();
+        if (!arguments.noJdk) {
+            classpath.add(CompilerDependencies.findRtJar());
+        }
+        if (!arguments.noStdlib) {
+            classpath.add(PathUtil.getDefaultRuntimePath());
+        }
         if (arguments.classpath != null) {
             for (String element : Splitter.on(File.pathSeparatorChar).split(arguments.classpath)) {
                 classpath.add(new File(element));
@@ -223,4 +224,18 @@ public class K2JVMCompiler extends CLICompiler<K2JVMCompilerArguments, K2JVMComp
         }
         return classpath;
     }
+
+    @NotNull
+    private static List<File> getAnnotationsPath(@NotNull K2JVMCompilerArguments arguments) {
+        List<File> annotationsPath = Lists.newArrayList();
+        if (!arguments.noJdkAnnotations) {
+            annotationsPath.add(PathUtil.getJdkAnnotationsPath());
+        }
+        if (arguments.annotations != null) {
+            for (String element : Splitter.on(File.pathSeparatorChar).split(arguments.classpath)) {
+                annotationsPath.add(new File(element));
+            }
+        }
+        return annotationsPath;
+    }
 }
diff --git a/compiler/cli/src/org/jetbrains/jet/cli/jvm/compiler/JetCoreEnvironment.java b/compiler/cli/src/org/jetbrains/jet/cli/jvm/compiler/JetCoreEnvironment.java
index 1aa3da3cdf9..0e2595972ca 100644
--- a/compiler/cli/src/org/jetbrains/jet/cli/jvm/compiler/JetCoreEnvironment.java
+++ b/compiler/cli/src/org/jetbrains/jet/cli/jvm/compiler/JetCoreEnvironment.java
@@ -27,6 +27,8 @@ import com.intellij.psi.PsiFile;
 import com.intellij.psi.PsiManager;
 import org.jetbrains.annotations.NotNull;
 import org.jetbrains.jet.asJava.JavaElementFinder;
+import org.jetbrains.jet.cli.jvm.JVMConfigurationKeys;
+import org.jetbrains.jet.config.CompilerConfiguration;
 import org.jetbrains.jet.lang.parsing.JetParser;
 import org.jetbrains.jet.lang.parsing.JetParserDefinition;
 import org.jetbrains.jet.lang.psi.JetFile;
@@ -37,6 +39,7 @@ import org.jetbrains.jet.lang.resolve.java.extAnnotations.CoreAnnotationsProvide
 import org.jetbrains.jet.lang.resolve.java.extAnnotations.ExternalAnnotationsProvider;
 import org.jetbrains.jet.lang.types.lang.JetStandardLibrary;
 import org.jetbrains.jet.plugin.JetFileType;
+import org.jetbrains.jet.utils.PathUtil;
 
 import java.io.File;
 import java.net.URL;
@@ -189,4 +192,16 @@ public class JetCoreEnvironment extends JavaCoreEnvironment {
     public CompilerDependencies getCompilerDependencies() {
         return compilerDependencies;
     }
+
+    public void configure(@NotNull CompilerConfiguration compilerConfiguration) {
+        File[] classpath = compilerConfiguration.getUserData(JVMConfigurationKeys.CLASSPATH_KEY);
+        File[] annotationsPath = compilerConfiguration.getUserData(JVMConfigurationKeys.ANNOTATIONS_PATH_KEY);
+        assert classpath != null && annotationsPath != null;
+        for (File path : classpath) {
+            addToClasspath(path);
+        }
+        for (File path : annotationsPath) {
+            addExternalAnnotationsRoot(PathUtil.jarFileOrDirectoryToVirtualFile(path));
+        }
+    }
 }
diff --git a/compiler/cli/src/org/jetbrains/jet/cli/jvm/compiler/KotlinToJVMBytecodeCompiler.java b/compiler/cli/src/org/jetbrains/jet/cli/jvm/compiler/KotlinToJVMBytecodeCompiler.java
index b924597f306..28a5bd054a5 100644
--- a/compiler/cli/src/org/jetbrains/jet/cli/jvm/compiler/KotlinToJVMBytecodeCompiler.java
+++ b/compiler/cli/src/org/jetbrains/jet/cli/jvm/compiler/KotlinToJVMBytecodeCompiler.java
@@ -19,6 +19,7 @@ package org.jetbrains.jet.cli.jvm.compiler;
 import com.google.common.base.Predicate;
 import com.google.common.base.Predicates;
 import com.intellij.openapi.project.Project;
+import com.intellij.openapi.util.io.FileUtil;
 import com.intellij.psi.PsiFile;
 import com.intellij.testFramework.LightVirtualFile;
 import com.intellij.util.LocalTimeCounter;
@@ -36,6 +37,7 @@ import org.jetbrains.jet.cli.common.messages.CompilerMessageLocation;
 import org.jetbrains.jet.cli.common.messages.CompilerMessageSeverity;
 import org.jetbrains.jet.lang.psi.JetFile;
 import org.jetbrains.jet.lang.psi.JetPsiUtil;
+import org.jetbrains.jet.lang.resolve.java.CompilerDependencies;
 import org.jetbrains.jet.lang.resolve.name.FqName;
 import org.jetbrains.jet.lang.resolve.AnalyzerScriptParameter;
 import org.jetbrains.jet.lang.resolve.java.AnalyzerFacadeForJVM;
@@ -100,11 +102,6 @@ public class KotlinToJVMBytecodeCompiler {
             boolean jarRuntime) {
 
         for (Module moduleBuilder : modules) {
-            // TODO: this should be done only once for the environment
-            if (configuration.getEnvironment().getCompilerDependencies().getRuntimeJar() != null) {
-                CompileEnvironmentUtil
-                        .addToClasspath(configuration.getEnvironment(), configuration.getEnvironment().getCompilerDependencies().getRuntimeJar());
-            }
             ClassFileFactory moduleFactory = compileModule(configuration, moduleBuilder, directory);
             if (moduleFactory == null) {
                 return false;
@@ -210,7 +207,7 @@ public class KotlinToJVMBytecodeCompiler {
             try {
                 GeneratedClassLoader classLoader = new GeneratedClassLoader(factory, new URLClassLoader(new URL[]{
                         // TODO: add all classpath
-                        configuration.getEnvironment().getCompilerDependencies().getRuntimeJar().toURI().toURL()
+                        PathUtil.getDefaultRuntimePath().toURI().toURL()
                 },
                         AllModules.class.getClassLoader()));
                 Class<?> scriptClass = classLoader.loadClass(ScriptCodegen.SCRIPT_DEFAULT_CLASS_NAME.getFqName().getFqName());
diff --git a/compiler/tests/org/jetbrains/jet/codegen/TestlibTest.java b/compiler/tests/org/jetbrains/jet/codegen/TestlibTest.java
index 96982c8049d..83580b3d7c1 100644
--- a/compiler/tests/org/jetbrains/jet/codegen/TestlibTest.java
+++ b/compiler/tests/org/jetbrains/jet/codegen/TestlibTest.java
@@ -77,7 +77,7 @@ public class TestlibTest extends CodegenTestCase {
 
             myEnvironment.addToClasspath(junitJar);
 
-            myEnvironment.addToClasspath(myEnvironment.getCompilerDependencies().getRuntimeJar());
+            myEnvironment.addToClasspath(ForTestCompileRuntime.runtimeJarForTests());
 
             CoreLocalFileSystem localFileSystem = myEnvironment.getLocalFileSystem();
             myEnvironment.addSources(localFileSystem.findFileByPath(JetParsingTest.getTestDataDir() + "/../../libraries/stdlib/test"));