Statkraft

COMPANY PROFILE

2014

STATKRAFT

+47 24 06 70 00 | www.statkraft.com

Nothing but progress for Norwegian renewable specialist Editorial – Tim Hands

We are barely six months into 2014 but Statkraft has already wrapped up a number of important deals that look set to further bolster the company’s already fantastic position in the European energy sector.

Statkraft - Europe’s largest generator of renewable energy and the leading power company in Norway - started 2014 positively, announcing a robust set of results for the first quarter. The company achieved an underlying operating profit before depreciation (EBITDA) of kr3836 million, compared with kr4180 million in the corresponding

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period in 2013. The net profit was kr2800 million, compared with kr443 million in the first quarter of 2013.

The groups decrease in EBITDA can perhaps be put down to reduced power generation and decreases in the average cost of Nordic power. The average Nordic power price was 30.2 EUR/MWh,

declining from 42 EUR/MWh in the first quarter of 2013. Power production totalled 15.4 TWh, compared with 17.4 TWh in the corresponding quarter of 2013.

Importantly, net profit ended at NOK 2800 million, which is an improvement of NOK 2358 million compared with the first quarter of 2013.

Statkraft President and CEO, Christian Rynning-Tønnesen said that decreasing revenues from Nordic hydro power were offset by success in the wind power market. He said that on the whole, Statkraft was satisfied.

“Statkraft’s underlying EBITDA for the first quarter ended at kr3836 million, which is kr344 million below the corresponding quarter in 2013. Lower revenues from Nordic hydropower are largely counteracted by significant revenues from Statkraft’s market operations and increasing contributions from wind power.

Based on the market situation, we are satisfied with this result.”

He went on to say: “Statkraft aims to develop more wind power.

These activities are an important part of our further development

as a leading player in renewable energy.”

DONE DEALS In the wind sector, Statkraft is setting out its stall for a prosperous future after announcing it has taken over operating responsibility for Sheringham Shoal, an offshore wind farm in the UK. A Memorandum of Understanding was also signed between Statkraft, NTE, Agder Energi and TrønderEnergi in the first quarter of 2014 in order to realise 600 MW of wind power on the Fosen peninsula in Central Norway.

In March, the four companies signed a letter of intent to establish a joint venture to develop and operate three of nine licensed wind energy projects on the coast

of the Trøndelag counties.

Statkraft will own 50.1 per cent of the new wind power joint venture, with Agder Energi owning 20.9 per cent and NTE and TrønderEnergi with a 14.5 per cent ownership stake each. The parties have also agreed that Statkraft will be responsible for the engineering, development and operation of the wind farms on behalf of the joint venture company.

The joint venture increases the likelihood of the three wind farms; Storheia, Kvenndalsfjellet and Roan being realised, which in turn will facilitate grid access for the remaining licensed onshore wind projects on Fosen. The joint venture will own the three wind farms and the total installed capacity will be more than 600 MW.

images courtesy of Statkraft PAGE 3

But all of this comes after the company announced in 2010 that it would undergo a consolidation of its onshore wind portfolio and just three months ago, it was announced that Statkraft UK has completed the sale of its 50 per cent share in Barmoor Wind Power Ltd, the company that owns the six turbine Barmoor wind farm project.

The project was sold to EDF Energy Renewables, a 50:50 Joint Venture between EDF Energy and EDF Energies Nouvelles.

Statkraft has also sold its stake in the Carraig Gheal project but increased its ownership in the Baillie and Berry Burn projects.

Baillie Wind Farm was officially opened in September 2013, and Berry Burn Wind Farm is set to open later in 2014.

Shimon Shoshani, Head of Project Development in Statkraft UK Ltd said: “Statkraft is pleased to see the Barmoor project in good hands before the construction phase. Statkraft has ambitious growth plans for onshore wind power in the UK, and this transaction contributes to streamlining our portfolio towards larger projects, in line with our strategy. We are actively seeking further investment opportunities in the UK renewables sector, an attractive market for investments.”

Christian Egal, CEO of EDF Energy Renewables said: “We’re pleased to have acquired this excellent project from Duke Energy and Statkraft UK. We have ambitious plans to continue to grow our portfolio of onshore wind farms, through our own development activities and through acquisitions. This deal is consistent with that ambition and our ability to deliver new projects.

“We are very keen to start

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construction at the site and will start liaising with the local community on our building plans as soon as possible.”

It seems that wind power will be one of the key revenue streams for Stakraft going into the future and with significant recent investments marking a new emphasis on European wind power, Statkraft is perfectly situated to benefit.

“Statkraft aims to develop more wind power.

These activities are an important part of our further development as a leading player in renewable energy”

Siemens announced recently that it would invest £160 million in wind turbine production and installation facilities in Yorkshire, while at the same time Associated British Ports (ABP) is investing a further £150 million in the Green Port Hull development This prompted Bjorn Drangsholt, Statkraft UK Managing Director to remark: “Statkraft welcomes the announcement to construct two offshore wind turbine facilities in the UK. This demonstrates that the UK offshore industry is going from strength to strength and delivering benefits in terms of jobs and growth in the supply chain in addition to those that are already

being created in the development, construction and operation of projects.”

SOLAR BOLSTERING THE MIX In May, Statkraft announced that it would bolster its solar business by entering into a 15 year Power Purchase Agreement (PPA) for the renewable energy generated from an 88 MW portfolio of six utilityscale photovoltaic solar power plants across the UK. The power produced from these plants is enough to supply around 20,000 homes. Each of the plants was constructed by SunEdison, global energy solutions company, who will continue to manage the plants throughout the 15 year agreement.

“The solar market is in an exciting place right now and we are delighted to win SunEdison as a customer. The Statkraft team demonstrated our ability to immediately respond to tight customer deadlines which was instrumental in closing this deal. We hope to build a strong partnership with SunEdison into the future,” said Tim Foster, Head of Renewable Origination at Statkraft.

José Pérez, SunEdison’s President of Europe, Africa and Latin America added: “The UK solar market is growing rapidly as the people of Great Britain are increasingly asking for renewable energy. This PPA will provide Statkraft reliable, predictably priced energy for years to come and help them meet the strengthening demand for renewable energy. We look forward to continuing to support this growth and the local economy through future projects.”

But even with the strength of its

Statkraft

wind and solar projects, Statkraft is always pushing the boundaries and exploring new methods of clean energy production. One of the most recent announcements from Statkraft detailed plans for the company to partner with forestry business Soedra and form a company that will produce clean fuel from wood. It is reported that Soedra will take 49 percent and Statkraft will take the remainder of the new company.

Soedra CEO, Lars Idermark said: “Soedra is monitoring with great interest the technology developments and the business opportunities presented by the use of forest raw materials for industrial production of climateneutral fuels.”

With developments like this constantly coming through at Statkraft there is no doubt that this Port of Ngqura

industry powerhouse will continue towards its vision of ‘providing pure energy’, a vision which it seems has already been achieved and is now being strengthened through innovation, responsibility and the highest levels of competence

Statkraft: The facts

Headquarters: Lilleaker, Norway Founded: 1992 CEO: Christian Rynning-Tønnesen Employees: 3500 Industries: Renewable Energy; Wind, Solar, Hydro, Gas, District Heating etc.

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