Vattenfall has had a good start to 2023 with stable financial development. Thanks to a calmer energy market, we have been able to focus entirely on our strategy of investing in fossil-free power generation, upgrading the electricity grid and helping our customers reduce their climate impact. It is also very gratifying to see that more customers are choosing Vattenfall.
Vattenfall’s President and CEO Anna Borg comments on the interim report for January-March 2023:
The trend of falling electricity prices at the end of last year continued into early 2023. On the continent, gas stocks were well filled, which, in combination with a mild winter and the increased availability of French nuclear power, pushed down both fuel and electricity prices. Reduced price area differences in combination with a lower hedge ratio contributed to the fact that Vattenfall's achieved price for electricity in the Nordics doubled compared to the first quarter of 2022.
Stable underlying result
Profit for the period increased by SEK 5.8 billion to SEK 11.8 billion, mainly thanks to an improved finance net, which was affected by a higher return from the Swedish Nuclear Waste Fund. The underlying operating profit was stable at SEK 9.5 billion.
The heat business contributed positively to the result, as increased fuel prices last year were reflected in our customer contracts now in retrospect. We have a higher result from the distribution business and higher realised earnings from the trading operations. Wind power reports a lower result due to lower electricity prices on the continent. This was partially offset by newly installed capacity where, for example, the Hollandse Kust Zuid wind farm made a positive contribution. The customer business is performing well, and the number of customers increased by 120,000 during the first quarter. However, the number of gas customers in the Netherlands and Germany was lower, which in combination with lower average consumption contributed to a lower result.
Nuclear power had lower availability due to the delayed restart of Ringhals 4. The complicated repair work has been carried out in a careful and safe manner and the restarted reactor now continues to supply fossil-free electricity in southern Sweden.
Investments that drive the energy transition forward
Thanks to a strong financial position, Vattenfall can maintain a high pace in investments throughout the value chain for fossil-free electricity and heat. During the quarter, we made the decision to invest in the onshore wind farm Bruzaholm, which will add much-needed capacity in southern Sweden. We invest in district heating with a low climate impact, for example, through the development of the district heating network in Bristol, in the UK. To meet the increased need for capacity in the electricity grid, we are also carrying out a comprehensive upgrade of the regional grid. In the new energy landscape, all types of fossil-free electricity generation will be needed, as will an expanded and robust electricity grid.
First quarter of 2023
Business highlights, January–March 2023
- Lower electricity prices and reduced price area differences
Repair of Ringhals 4 finalised
- Completed divestment of the gas-fired power plant Magnum in the Netherlands
- Important steps in the feasibility study for building small modular reactors at Ringhals
- Final investment decision made for the Bruzaholm onshore wind farm
- Completed acquisition of district heating network in the UK
- Partnership entered into with the Stromma Group to electrify the company's boat fleet
- Continued upgrading of the regional network to meet increasing capacity needs
Financial highlights, January–March 2023
- Net sales increased by 62% (53% excluding currency effects) to SEK 96,788 million (59,579)
- Underlying operating profit of SEK 9,545 million (9,504)
- Operating profit of SEK 16,332 million (12,783)
- Profit for the period of SEK 11,818 million (6,064)