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Nordic Energy Market Overview

• All Nordic countries have liberalised their electricity markets and has a

common Nordic wholesale electricity market.

• Nearly 15 million electricity customers in the Nordic

• Nord Pool Spot runs the largest market for electrical energy in Europe

• During 2014, a total of 387.3 TWh was generated, consumption

decreased to 375.7 TWh in 2014 resulting in price fall from a yearly

average of 38.1 EUR/MWh to 29.6 EUR/MWh between 2013 and 2014.

Nordic electricity production is two thirds renewable

• Large amount of hydropower in Norway, and Sweden, Denmark has the

highest share of wind power in the world, Iceland generates significant

electricity from geothermal sources

• Official Nordic co-operation is channelled through two organisations: the

Nordic Council and the Nordic Council of Ministers.

• The Nordic countries have set ambitious policies to support the

decarbonisation of their energy systems by 2050.

• Carbon-neutrality in Norway, to domestic emissions reductions of 80 % in

Finland, to a 100 % renewable energy system in Denmark

• Focus on bioenergy, energy efficiency and CCS

• Increase in R&D funding (Biomass -SE, DN, FI - Energy efficiency -FI, NO –

CCS- NO

• NordREG - is an organisation for the Nordic energy regulators and their

objective is to create a Common Nordic End-User Market where

customer can purchase electricity from another Nordic country

Nordic Energy Market Overview

Utility Share

Sweden Vattenfall 13.6%

E.ON Sweden 7.0%

Fortum 5.7%

Utility Share

Norway Statkraft 14.4%

E-CO Energi 2.8%

Hydro 1.9%

Utility Share

Finland Fortum 4.5%

PVO 3.1%

Helsingin Energia 1.5%

Utility Share

Denmark Dong Energy A/S 4.5%

Vattenfall 0.4%

Utility Share

Other generators 40.9%

Total Nordic region 100.2%

Nordic Energy Market Overview

Management Focus, Nordic Region vs. Global Increasing focus on growth, innovation and agility

Nordic Utilities Strategic IT Priorities

Business Trend

Technology Priorities, Nordic Region vs. Global

The Competition and the Utility Specific Capabilities

Nordic Energy Regulators & Exchange

Major Nordic Utilities

Major Nordic TSOs

Resellers

DATAHUB

Common/Harmonised Nordic End-User Market (National Update) Smart Metering and Data-Hubs in order to facilitate easier communication of meter and master data between DSOs’ and Suppliers,

a data hub was introduced

Denmark

• Danish supplier centric model SCM will be developed into a wholesale model by the 1st of April 2016

• This new information exchange system is operated by the Danish TSO, Energinet.dk.

• The Danish government has decided a national roll out of smart meters (SM) by 2020

Finland

• The finnish TSO Fingrid Oyj proposed hub as future information exchange solution.

• The coverage of the smart meters is estimated to be about 97 % of all the consumption places.

https://www.youtube.com/watch?v=Q9TWaq2Gyeg , http://www.fingrid.fi/en/customers/datahub/Pages/default.aspx

Norway

• The two main ongoing harmonisation processes are Norwegian national point of information exchange (ElHub), and the ongoing study on

the implementation of mandatory combined billing.

• Statnett was delegated the responsibility to develop and operate Elhub, Elhub will be operational from February 20th 2017

• The roll out of smart meters in Norway is scheduled to be completed by January 1st 2019. http://elhub.no/ , https://www.nve.no/

Sweden

• Svenska Kraftnät (SvK) that owns the Swedish national grid was asked to establish and run a national data hub and gave Energy Markets

Inspectorate Ei the task to set up the legal frame work

• The report by Ei regarding the implementation of a supplier centric moving process before the establishment of a national data hub was

negative hence, A revised propsal from Ei should be delivered to the government in February 2017.

• It seems realistic to anticipate propsals of detailed regulation on metering systems during 2016. The implementation of the second

generation of smart meters is expected to take place between 2017 and 2025.

Utility Market Predictions

Nordic Utility Market Predictions Annual IT Spending by Western European Utilities to Reach $13.5 Billion by 2018, with an estimated 2013–2018 CAGR of 4.1%.

• Despite the economic downturn, utilities are investing in IT to achieve

operational efficiency and possibly innovate and grow

• Software spending will see the most significant increase, growing at a

2013–2018 CAGR of 6.3%, reaching $3.6 billion by 2018.

• IT services also has a positive outlook, growing just below average at

3.8%

• Hardware spending, when excluding mobile devices, is expected to be

almost flat, barely growing at 1.4% between 2014 and 2018.

• Electricity accounts for the largest share of IT spending

• The subindustry is not expected to reduce its spending any time soon as

it will have the fastest-growing, above-average CAGR between 2013 and

2018 (4.6%).

• Gas is also expected to continue to spend well in the forecast period,

but spending will be below average at a 2013–2018 CAGR of 3.7%.

• The water subindustry will have the slowest growth rate — significantly

below average at 2.7%

• The U.K. has the largest IT spending in the electricity sector, accounting

for 20.5% of total electricity IT spending in Western Europe.

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