Finnish energy companies bought a sizable share of Swedish hydropower
EPV Energia Oy, Helsingin Energia and Kymppivoima Oy have purchased from DONG Energy Wind Power Holding A/S a share of the most important hydropower reserves in Sweden.
The gist of the acquisition is an agreement to acquire a share of the production of seven hydroelectric power plants located in the River Indalsälven in Central Sweden as from 1 July 2013. The value of the acquisition is EUR 605 million. </b> The Danish energy company DONG Energy Wind Power Holding A/S sold its 25.7% holding in Kraftgården Ab to the consortium consisting of EPV Energia, Helsingin Energia and Kymppivoima Oy. The hydroelectric power plants owned by Kraftgården Ab are located in the River Indalsälven, which is one of the most important hydropower reserves in Sweden. The acquisition comprised 161 MW of the power plants’ output capacity, which equals the average annual production of 862 GWh. EPV Energia, Helsingin Energia and Kymppivoima Oy have founded a separate new project company, Voimapiha, which is owned equally by the three consortium members.
- Hydropower is a valuable energy production form, and large-scale hydropower is seldom available for acquiring. EPV Energia Oy is systematically progressing towards low-emission energy production, due to which it is only natural for the company to be involved in a project of this magnitude, which offers direct ownership of emission-free hydropower, states CEO Rami Vuola of EPV Energia Oy.
For Finnish energy companies, owning Swedish hydropower is an interesting acquisition object, because the River Indalsälven is the third important river in Sweden producing hydropower.
- For us, this solution is economically justified, and it increases the volume of our hydropower production by 50%. The increase in hydropower production supports our strategy towards a carbon-neutral future. The increase in controlled hydropower production creates better opportunities for increasing also other renewable energies, such as wind power and photovoltaic solar energy in the future, explains CEO Pekka Manninen of Helsingin Energia.
The hydroelectric power plants are in good shape technically, and they have a long history of reliable operation and excellent profitability. In recent years, the electricity production volumes have even been higher than the long-term average.
- Hydropower is one of the supporting columns of the Nordic electricity markets. The increase in hydropower production improves Kymppivoima Oy’s ability to deal with any future uncertainty factors in the electricity market. The value of hydropower as an emission-free and controllable production form will increase, as the targets of renewable production will bring more and more non-controllable production to the market, states CEO Anders Renvall of Kymppivoima Oy.
• DONG Energy Wind Power Holding A/S sells its 25.7% holding in Kraftgården Ab to Voimapiha, which is equally owned by EPV Energia, Helsingin Energia and Kymppivoima Oy. • The remaining shares are owned by Vattenfall Vattenkraft Ab, which is the principal owner of Kraftgården Ab. • Vattenfall Indalsälven Ab (“VIAB”), which produces hydropower in the River Indalsälven in Central Sweden by operating seven large hydroelectric power plants, is wholly owned by Kraftgården.
• The overall output of the seven power plants owned by Kraftgården is 626 MW and their annual production volume is 3,358 GWh.
• The production volume related to the acquisition is 862 GWh in a normal hydrological year, and the acquired share of production capacity is 161 MW.
• The annual hydropower production volume in Finland is 13 TWh in a normal year. The acquired share of production capacity corresponds to approx. seven per cent of Finland’s hyrdropower production.
• The River Indalsälven is the third important river in Sweden producing hydropower. There are a total of 24 hydroelectric power plants operating in the River Indalsälven. The overall production volume of the plants is 9.6 TWh.