HelenPortfolioManagement
Good result achieved in highly volatile market conditions
The result of HelenPortfolioManagement 's first year of operation was good, and the result targets were mainly achieved. The turnover of HelenPortfolioManagement was EUR 590 million. Two thirds of the turnover came from the sale of electric energy to the Nordic wholesale market and one third from the sale of thermal energy. The biggest cost item was fuel purchases, which were higher than forecast due to increases in market prices.
The sales volume of electric energy was 7, 900 GWh, i.e. 2% less than the corresponding procurement in the previous year. The decrease in the sales volume of electric energy was due to milder-than-usual weather and the low market price of electricity at the beginning of the year.
The eco-efficient combined production of electricity and heat in the Helsinki power plants accounted for 66% of the supply of electric energy. The supply of renewable energy and nuclear power from our partly-owned power plants accounted for 23% of the total supply of electric energy. The proportion of other sources of supply was 11%. The supply of thermal energy from HelenPower amounted to 6,221 GWh. The thermal energy was sold to HelenDistrictHeat.
Market trends difficult to forecast
The prices of electricity and fuels rose to peak levels by the middle of the review year, from where they fell by dozens of percentages by the end of the year due to a crisis that had started in the financial sector. In such a situation, the importance of consistent operating principles and hedging policies is emphasised. Therefore, we revised our operating strategy and investigated various scenarios in the year under review.
Within the EU emissions trading scheme, the first year of the 5-year Kyoto period has passed and the prices of emission allowances have dropped due to diminished demand. The operating year ended in an EU summit, at which an agreement was reached on an energy and climate package for the years 2013-2020. The decisions made for the future have already now affected our operating policy.
Transmission network problems between Norway and Sweden resulted in big differences between the area price and system price also in Finland. Even though the integration of the Nordic electricity market into the market in Continental Europe progressed at the same time due to the commissioning of a submarine power cable between Norway and the Netherlands, congestion within the transmission network had a significant impact on the operations of HelenPortfolioManagement.
First year of operation of HelenPortfolioManagement
HelenPortfolioManagement started operation in its present form at the beginning of 2008. It was formed by combining the functions responsible for wholesale trading and production control. Among HelenPortfolioManagement's basic functions are energy procurement planning, production portfolio management and trading on the wholesale market, and balance management and settlement. In addition to attending to the basic functions, we focused on improving our operating model.
In the course of the operating year, we formulated a business strategy for HelenPortfolioManagement, draw up process descriptions, updated the risk management manual, developed the operating model of the energy value chain and sought to utilise employee synergy. The energy management system was revised and the central control room was renovated. At the end of 2008, HelenPortfolioManagement was assigned the remote control of the operation of the Kymijoki hydropower plants owned by Oy Mankala Ab.
Balance management carried out by the staff of the central control room succeeded well, even though there were a few events that disturbed the balance management activities during the operating year. We also prepared ourselves for the changes that will take place in balance management. At the start of 2009, a common practice will be adopted in the Nordic countries to harmonise balance management activities.
We took part in the work of a working group that prepared the opening up of the Baltic electricity markets with the goal of creating a new price area in Estonia in 2009. We also made a decision on participating in emission reduction projects with the aim of utilising the certificates resulting from the projects to cover Helsingin Energia's emissions.
Partnership relations focused on operational development
HelenPortfolioManagement operates among wholesalers, due to which the number of customers is limited. We got off to a good start in developing partnerships within the Helen Group and in associated companies, and their development will be one of our priorities in 2009.
HelenPortfolioManagement is responsible for the commercial operations and availability of Helsingin Energia's power plants and power assets. HelenPortfolioManagement had 28 employees at the end of 2008.
Spot price of electricity
(local price in Finland)
Price trend of coal
