ByFortum is one of Europe’s cleanest power generators, operating CO2-free hydro and nuclear plants as well as district heating services and electricity retail businesses.
Fortum has pledged no net loss of biodiversity from direct operations from 2030 onwards and has set itself the target of reducing dynamic terrestrial impacts by 50% within upstream Scope 3 (base year 2021). They are exploring SMR options with partners such as Westinghouse.
Hydropower
Fortum’s hydropower assets account for around one fifth of its overall electricity and heat production.
The group owns or co-owns 33 power plants with an aggregate capacity of 4,653MW (2022). Fortum has hydroelectric operations located within Oulujoki (eleven river systems) and Vuoksi river systems (two). Furthermore, this company owns both a nuclear reactor facility at Loviisa as well as final waste disposal facility Olkiluoto. You can click here to learn more about hydroelectric power.
Climate change and its attendant need to lower carbon dioxide emissions have presented power industry with an immense challenge, prompting it to switch from fossil-fuel to renewable energy sources such as hydropower. Fortum is an established clean genco and well positioned to capitalize on this transition due to its existing portfolio, operational flexibility, water flow management capabilities and strong hedging positions.
Hydropower provides significant additional capacity during times of peak demand and is easily integrated into the grid due to its flexible output, making integration relatively effortless – this is especially evident when combined with other renewable energies like wind as Fortum has done with their Espoo district heating network.
Hydropower plants’ environmental impacts depend heavily on how they are operated and administered; some operations could have negative repercussions for biodiversity by decreasing river dissolved oxygen levels and disrupting wildlife habitats.
Fortum has taken steps to lessen its impact on biodiversity by taking several measures, including improving river flows and lowering discharges from hydropower plants, while also adhering to best practice operations at their hydropower sites.
Fitch estimates Fortum’s refinancing needs as being manageable given its adequate liquidity position, low leverage at year-end 2022 and strong business profile. Fitch believes the company could access bond markets to extend the average life of debt while increasing financial flexibility.
Fortum is a leading Nordic energy company with the focus of providing clean and reliable baseload services at reduced carbon levels. Their reportable segments include Generation, Russia, City Solutions and Consumer Solutions; with Generation comprising nuclear, hydro, wind and thermal generation; industrial solutions; portfolio optimisation services and trading.
Russia includes both power generation as well as district heating businesses while City Solutions offer sustainable services such as heating and cooling within urban environments.
Nuclear
Fortum is one of the leading Nordic power producers, operating over 150 hydro, CHP (combined heat and power), nuclear, solar and wind plants to supply electricity and heat to around 2.4 million customers in total. You can click the link: https://www.iaea.org/newscenter/news/what-is-nuclear-energy-the-science-of-nuclear-power to learn more about nuclear power.
They also offer various energy related services and products – energy consulting, waste management services, environmental construction services as well as electric vehicle charging solutions are amongst those provided by Fortum.
This company was established in 1998 through a merger between oil refiner Neste Oyj and power company Imatran Voima Oyj (Neste Oil was demerged from Fortum in 2005). Headquartered in Espoo, Finland, Fortum’s core business includes electricity and heat generation as well as significant waste operations and expanding renewables activities.
Fortum’s owned and operated power production capacity in Finland totaled 4,653MW as of 2022. We operate 33 fully owned hydropower plants in Finland – mostly concentrated around Oulujoki and Vuoksi River systems – along with 20 co-owned facilities with Kemijoki Oyj. Additionally, Fortum also owns Olkiluoto, Oskarsham and Loviisa nuclear power stations.
Nuclear energy is an efficient low-carbon source with minimal land-use impacts, and thus an integral component of our efforts to lower carbon dioxide emissions and move toward a low-carbon society. Unfortunately, nuclear power requires high capital costs and lengthy construction times, meaning its costs have skyrocketed over the years.
Since Russia’s annexation of Crimea in 2014, Fortum’s investments in Russia have come under international pressure. Nevertheless, we will maintain operations there: our Loviisa nuclear power plant currently holds an operating license until 2050 and we are about to commence construction of its final disposal facility for low and intermediate level radioactive waste from across Europe.
Renewables
Fortum is one of Europe’s premier clean energy companies. Generating over 46.4 TWh per year from CO2-free nuclear and hydropower generation sources, Fortum strøm also generates significant amounts from onshore wind and solar generation as well as district heating/cooling operations and electricity retail business operations.
Fortum’s strategy entails optimizing its best-in-class power generation fleet while meeting environmental goals. They have embarked on an aggressive decarbonisation program with plans to reach carbon neutrality as early as 2030 while exiting coal by 2027 – as well as setting ambitious emissions and biodiversity goals.
Fortum specializes in serving Nordic markets and has established itself as a strong player in e-mobility with their Charge & Drive EV charging infrastructure and related digital services. Furthermore, Fortum is actively expanding their waste management and recycling businesses.
Fortum has earned a great reputation for the quality of its products and services; however, the company is currently facing an unfavorable business environment. Earnings and cash flow have been adversely impacted due to declining wholesale power prices in Nordic markets; thus leaving Fortum struggling to reduce debt levels.
IEEFA advises a cautious stance towards Uniper stock, while calling for tighter control on executive management decisions at state-owned utilities to safeguard long-term taxpayer interests. Furthermore, Fortum made its massive and risky investment without government and parliamentary intervention or oversight.
Fortum has experienced earnings and cash flow decline due to declining wholesale power prices in Norway. Their financial condition was further harmed when they experienced EUR5.2 billion losses from purchasing Uniper, which owned assets related to coal and gas power generation in Germany and Russia.
CHP
CHP (combined heat and power) is an energy production method which simultaneously produces electricity and thermal energy from one fuel source – whether fossil such as natural gas, coal, biomass or biogas – at high efficiency levels. CHP systems can even use waste heat from electricity production to drive absorption chillers for cooling use, making this technology key in meeting worldwide energy demands for sustainable, cost-effective energy sources.
CHP technology has already proven itself across industries, commercial applications and institutions in the US. According to one source, 4,700 facilities utilize CHP systems for process heat and electricity production – including some of the country’s top employers, municipalities, universities and urban centers. CHP systems used in such sites tend to be smaller than power plants while still able to utilize various fuel sources.
Drake highlighted that one of the main challenges is matching consumer energy demands with CHP system performance, and suggested this can be accomplished using a multi-stakeholder decision-making framework. This involves connecting consumer preferences with operational objectives such as cost, emissions, and water usage – with an aim of finding balance among these parameters to identify optimal trade-offs.
Energy storage can be an invaluable addition to Combined Heat and Power (CHP) systems, allowing them to meet peak loads without resorting to expensive and unreliable standby generation – this can be particularly useful for critical facilities like hospitals and data centres that need uninterrupted service delivery without risk of power outages or grid integration issues. Fortum’s portfolio features over 150 power plants – from hydropower plants and condensing units, nuclear, solar, and wind energy generation plants – which span hydro, combined heat and power (CHP), condensing, nuclear power reactors, solar PV panels and wind energy technologies. As one of the three leading Nordic generators and one of the leading heat producers globally, Fortum stands out with seven thermal power stations in Russia’s Urals and West Siberia regions that collectively produce 7.6GW.
