Fortum in Russia

Fortum in Russia
1
Generation and sales of power and heat
OAO Fortum (former TGC-10)
• Operates in the Urals and Western Siberia in the Tyumen
and Khanty-Mansiysk area (oil and gas industries) and in
the Chelyabinsk area (metal industry)
• Production fleet mainly gas-fired CHP capacity (2014)
• 23 TWh power generation
• 26 TWh heat production
TGC-1
OAO Fortum
St. Petersburg
Nyagan
Tobolsk
Moscow
TGC-1
• 29.5% of territorial generating company TGC-1 operating
in north-west Russia
• ~7,200 MW electricity production capacity (43% hydro),
~24 TWh power, ~28 TWh heat in 2014
2
Tyumen
Chelyabinsk
Extensive investment programme in ОАО Fortum nearly finished
• Total amount of investments EUR 2.5 billion
– Of which approximately EUR 0.1 billion still to be invested as of September 2015
• Investment programme increasing capacity by ~85%
• Seven units commissioned
OAO Fortum
– Unit 1 of Chelyabinsk GRES started commercial operation in
December 2015
St. Petersburg
3,000
+85%
+ ~2,400
2,000
1,000
2,785
2010
Feb 2011
Jun 2011
Oct 2011
Mar/Dec 2013,
Oct 2014
Tyumen
209 MW
Chelyabinsk
216 MW
Tobolsk
213 MW
Nyagan 1+2+3
420+424+422 MW
Dec 2015,
early 2016
~5,200
0
3
Chelyabinsk
New units
5,000
4,000
Tobolsk
Tyumen
Moscow
– Unit 2 of Chelyabinsk GRES estimated to start commercial operation
in early 2016
MW
6,000
Nyagan
2015
Chelyabinsk
2 x 247,5 MW
Fortum’s Russia segment key figures 2014
Power generation capacity
Heat production capacity
Employees, 31 Dec 2014
Sales in 2014
Share of Fortum’s sales
Comparable operating profit
4
EUR 1,055 million
20%
EUR 161 million
4,758 MW
13,466 MW
4,213
Fortum has long experience of co-operation
with the Soviet Union and Russia
1950
1960
Construction of hydro power
plants in Kola area
1980
1970
Construction of Loviisa
nuclear power plant
1990
2010
Construction of North-West CHP
in St. Petersburg
Electricity import to Finland
Nuclear fuel import to Finland* 
Co-operation
2000
Agreement on Joint
Implementation of Kyoto
Protocol with TGC-1
Automation & information system
deliveries to thermal power plants
Permanent presence in Moscow &
Safety improvements for
St. Petersburg 
nuclear power plants
Hydro refurbishments 
Ownerships
Executing of
2400 MW
CSA investments
in OAO Fortum
(6 plants ready
out of 8) 
Lenenergo shareholding
Lenenergo split
- TGC-1, Generation
- Lenenergo, Distribution
(divested in 2007)
TGC-10 acquisition,
today OAO Fortum
*) Including single largest purchase agreement of uranium with TVEL
5
Fortum’s key competitive advantages in Russia
• Newest and the most efficient fleet
among competitors
• Most of the fleet are combined heat and
power (CHP) plants
• Solid financial results, reliable, safe and
operations with low emission
• Good reputation among peers,
authorities and regulators
Run-rate operating profit (EBIT) target for
the Russia Segment
• Target RUB 18.2 billion expected to be
reached within 2-3 years
• Euro-denominated result level will be
volatile, mainly due to the translation
effect
6
TGC-1
OAO Fortum
St. Petersburg
Nyagan
Tobolsk
Moscow
Tyumen
Chelyabinsk
Fortum is the one of most efficient companies in Russian power
sector
Russian utilities in 2013
(Net profit*/Installed capacity (kEUR/MWe))
Russian utilities consensus forecast
(EBITDA/Installed capacity (kEUR/MWe))**
Production costs of generating
companies in 2013***, EUR/MWh
Fortum
Fortum
TGC-1
TGC-1
TGC-1
* According to Russian accounting system
7
** Source: Bloomberg
*** Whole costs of the company divided by
the total energy output (electricity and
heat). Based on Market Council data.
Russia is the World’s 4th largest power market
TWh
6,000
5,000
4,000
3,000
2,000
1,000
0
Power generation in 2014 based on gross output.
Source: BP Statistical Review of World Energy June 2015
8
Fortum’s power plants in Russia
•
•
Chelyabinsk GRES
–
286 MW electricity
–
882 MW heat
Chelyabinsk CHP-1
–
138 MW electricity
–
1,106 MW heat
•
•
•
•
•
Chelyabinsk CHP-2
–
320 MW electricity
–
1,112 MW heat
•
Chelyabinsk CHP-3
–
580 MW electricity
–
1,307 MW heat
•
Tyumen CHP-1
–
662 MW electricity
–
1,897 MW heat
Tyumen CHP-2
–
755 MW electricity
–
1,640 MW heat
Tobolsk
–
665 MW electricity
–
2,585 MW heat
Argayash CHP
–
195 MW electricity
–
670 MW heat
Nyagan 1+2+3
–
9
1,300 MW electricity
Argayash CHP
Commissioned in 1954
Fuelled by coal and natural gas
Electricity production capacity 195 MW
Heat production capacity 670 MW
Chelyabinsk GRES
Commissioned in 1930
Fuelled by natural gas
Electricity production capacity 286 MW
Heat production capacity 882 MW
Chelyabinsk CHP-1
Commissioned in 1942
Fuelled by natural gas and coal
Electricity production capacity 138 MW
Heat production capacity 1,106 MW
Chelyabinsk CHP-2
Commissioned in 1962
Fuelled by natural gas and coal
Electricity production capacity 320 MW
Heat production capacity 1,112 MW
Chelyabinsk CHP-3CHP-3
Commissioned in 1996
Fuelled by natural gas
Electricity production capacity 580 MW
Heat production capacity 1,307 MW
Tyumen CHP-1
Commissioned in 1960
Fuelled by natural gas
Electricity production capacity 662 MW
Heat production capacity 1,897 MW
Tyumen CHP-2
Commissioned in 1986
Fuelled by natural gas
Electricity production capacity 755 MW
Heat production capacity 1,640 MW
Tobolsk CHP
Commissioned in 1980
Fuelled by natural gas
Electricity production capacity 665 MW
Heat production capacity 2,585 MW
Nyagan
Nyagan 1 and 2 commissioned in 2013,
Nyagan 3 in January 2015
Electricity production capacity 1,300 MW
Next generation energy company