Hafslund’s long-standing tradition as a hydropower producer continued in 2011 with the opening of the new FKF4 power plant. The old Kykkelsrud Power Plant, constructed in 1903, was decommissioned in September 2008, and in spring 2011 the new power plant entered operation as part of Kykkelsrud Fossumfoss Power Plant (FKF).
FKF4 is the first new run-of-river hydropower plant opened by Hafslund for 25 years. It will provide extra capacity, which in turn will offer greater flexibility to shut down other generators and make upgrades and adjustments, and thus increase plants’ working lives. The expansion will boost production capacity at FKF by an amount corresponding to the annual electricity requirements of 5,000 residential units.
The water situation in 2011
2011 was one of the warmest and wettest years ever recorded in Norway. Despite an extremely dry first quarter, 2011 turned out to be the third-wettest year in 33 years, and with 126 per cent of the average water flow in Glomma, just ten per cent lower than the wettest year ever recorded. The water flow impacted operations and planned maintenance work at Hafslund’s power plants, where a number of upgrading projects were postponed in order to be able to exploit the water flow for optimal power production.
Refurbishment of Kaplan generators
In 2011 Hafslund Produksjon continued its refurbishment programme for the company’s Kaplan generators in order to improve and safeguard future operations. The Kaplan generators make the greatest contribution to the company’s power production in terms of production volume. The Vamma 11 and FKF 3 generators were taken out of operation in winter 2011/2012 for upgrading.
Vamma upgrading programme
The upgrading programme for the oldest Francis generators at Vamma was completed in 2011. Significant time and resources have been invested to boost the generators’ performance and working lives. The revamp will contribute a total of 20 GWh of new hydropower production. Hafslund Produksjon is also replacing the control plant at Vamma with the aim of securing optimal management and control of the company’s largest power station.
Hafslund Produksjon is looking at opportunities to increase power production in Nedre Glomma. In collaboration with other parties at Sarpsfossen, a feasibility study has been implemented at the Norwegian Hydraulic Laboratory at the Norwegian University of Science and Technology (NTNU). Watercourse conditions are being mapped to assess flood preparedness and opportunities to boost production at Sarpsfossen.
Since 1 January 2012 Hafslund’s power trading function has been part of the Production business area. The power trading business is a hub for all power trading activities, including risk management and hedging strategy. The business is responsible for physical and financial trading in connection with the sale of the Group’s own power production and price-hedging of end customer deliveries, and the purchase of grid losses for the Group’s own distribution and regional grids. The business takes up active positions in the Nordic wholesale power market. The majority of trading is cleared via Nasdaq OMX Commodities.
In 2011 the power trading business was split into two companies – Hafslund Hedging AS, which is responsible for price-hedging of future deliveries and spot trading on Nord Pool Spot in the financial market, and Hafslund Energy Trading AS, which is responsible for Hafslund’s trading activities.
Hafslund Produksjon is aiming to increase power production in existing plants, and is examining opportunities to increase power production in watercourses and at the companies’ existing locations, as well as in new watercourses. Recent years have seen a change in terms of precipitation, snowmelts and water flow, with a trend towards more precipitation and milder and wetter weather. This is an important factor for expanding capacity. Power prices and the introduction of the electricity certificate scheme are also making it more profitable to construct more capacity.
Hafslund’ s power plant rights were acquired before the establishment of the current scheme for reversion to state ownership, meaning that the Group’s own power plants may not be returned to state ownership.