Electricity prices continued to fall in 2024. Still, Vattenfall reports a stable underlying operating profit driven by higher achieved prices in the Nordics and an increased wind power generation. Strategic divestments strengthened the full-year results.
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Vattenfall’s President and CEO Anna Borg comments on the full-year report for 2024:
2024 has been a year of many challenges in the world around us. Not the least in terms of declining electricity prices and geopolitical and economic uncertainties. However, on a full-year basis, we report a stable underlying operating profit driven by higher achieved prices in the Nordics and an increase in wind power generation that counteracted lower electricity prices.
Strategic divestments also strengthened the full-year results. At the same time, we are reporting a weak fourth quarter weighed down by updated cost estimates for nuclear power. Vattenfall is committed to enabling a fossil-free future and therefore plans to invest SEK 170 billion over the period 2025 to 2029, focusing on fossil-free electricity generation and electricity grid. Electricity prices continued to fall in 2024
Electricity prices in the Nordics were on average 36% lower for the full year of 2024 compared to 2023. This was driven primarily by the strong hydrological balance, increased wind production and lower continental prices. On the continent, electricity prices dropped by an average of 19% due to lower gas prices and higher wind and solar capacity, but the prices were almost double to those in the Nordics.
Higher achieved prices in the Nordics and strategic divestments contribute to a strong result development
The underlying operating profit for the full year 2024 was relatively unchanged compared to 2023 and amounted to SEK 19.8 billion. Higher achieved prices in the Nordics and increased wind power generation had a positive effect. This was partially offset by increased provisions for nuclear power as a result of updated cost estimates, which negatively impacted the fourth quarter results.
Profit for the full year 2024 increased by SEK 23.0 billion to SEK 33.4 billion. The increase was mainly driven by capital gains related to the sale of 49% of the Nordlicht I & II wind power project to BASF and the sale of the Norfolk offshore wind power project in the UK. Positive market value changes for energy derivatives further strengthened the result. To maintain Vattenfall's competitiveness and profitability, we continue our focus on operational excellence.
The Board of Directors proposes a dividend of SEK 7 billion for 2024.
A stable investment climate and collaboration are crucial for enabling a robust energy system
2024 was characterised by geopolitical and economic challenges, which have slowed the energy transition. Despite this, the direction towards fossil freedom remains. Electrification through fossil-free energy is key, not only in the energy transition, but also in securing Sweden and Europe’s future competitiveness. We will need to make extensive investments in fossil-free electricity generation, distribution and storage solutions to meet the future energy demand.
Vattenfall plans to invest a total of SEK 170 billion between 2025 and 2029. The majority (61%) of the planned investments are growth investments with a focus on new fossil-free electricity generation. Important projects include the offshore wind power project Nordlicht I and II in Germany and the Zeevonk project in the Netherlands, which combines wind and solar power with hydrogen. To ensure that the electricity system is robust and stable, we need to expand the electricity grid. For this, we plan to invest around SEK 41 billion in connecting new customers to the electricity grid.
Last year, we worked at a high pace to enable new nuclear power in Sweden. We continue to evaluate our suppliers and are also looking forward to the Swedish government's report regarding state financing and risk sharing for new nuclear power, a prerequisite for investments in new nuclear power projects in Sweden.
To enable the energy system of the future, a stable investment climate and collaboration between companies, governments and citizens are required. We at Vattenfall are ready to build on our integrated and diversified business model and will continue to invest in profitable projects that gives us a competitive edge.
Business highlights, January–December 2024
- The sale of the heat business in Germany to the State of Berlin was completed
- Vattenfall sold the Norfolk Offshore Wind Zone in the UK
- Strengthened partnership with BASF through sale of 49% of the German offshore wind farms Nordlicht I and II
- Directional decision to extend the operating time of the nuclear power plants Forsmark and Ringhals reactors from 60 to 80 years
- Vattenfall took steps to enable new nuclear at Ringhals including evaluation of suppliers and conditions for construction
- Vattenfall and Copenhagen Infrastructure Partners won the tender of the IJmuiden Ver Beta (Zeevonk) offshore wind farm in the Netherlands
Financial highlights, January–December 2024
- Net sales decreased by 15% to SEK 245,570 million (290,168)
- Underlying operating profit of SEK 19,828 million (20,005)
- Operating profit of SEK 38,851 million (16,991)
- Profit for the period of SEK 33,380 million (10,395)
- The Board of Directors proposes a dividend of SEK 7,000 million
Financial highlights, October–December 2024
- Net sales decreased by 7% to SEK 68,488 million (73,292)
- Underlying operating profit of SEK 531 million (4,455)
- Operating profit of SEK 5,023 million (6,061)
- Profit for the period of SEK 5,084 million (5,657)
Full-year report
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