HSE INSPECTION Lifting safety

POWERTALK Let the People& POWER market rule!

NO. 4 2014 | PROVIDING PURE ENERGY

FEATURE | ETHICS Stricter requirements for Great openness and forces transparency A glacier front collapsed, and two billion litres of water disappeared. Vidar Riber recently saw the consequences of climate change up close.

1 STATKRAFT NO 4 2014 PEOPLE&POWER Content A MAGAZINE FOR STATKRAFT EMPLOYEES NO. 4 | 2014

For companies like Statkraft, The new green economy 6 the green shift looks promising. THE VANISHING LAKE On Friday afternoon, Lake We can create new value Nedre Demmevatn was ever has the power market been heavily in wind power. The private where it had always been. 28 more uncertain, says the chief of investor Jens Ulltveit-Moe acknowledges through clean energy. Monday morning the lake THE STATKRAFT SCHOOL Nord Pool Spot Mikael Lundin. that he has lost billions in green was gone. Climate change Stage-Gate is Statkraft’s He also gives a clear message to investments but continues to have strong means new challenges. decision-making and Nlet the market work by itself and believes faith in the sector and believes that solar project execution tool. that the EU has failed with its climate power will be the big winner. Elisabeth Here is a step-by-step policy. However, as we know, the energy Grieg from Grieg Group is convinced introduction. markets are all about high-level politics. that the maritime industry must also 10 It is an arena for the struggle between change course. She sees this a social LIFE-SAVING ROUTINES national and international solutions, responsibility, and believes that wealthy HSE inspections are between old and new economic models Norway should take advantage of the necessary, as proven by 31 President and CEO Christian GOOD NEIGHBOURS The and between climate friendly and fossil great opportunities it has to invest more Rynning-Tønnesen’s recent number of offshore wind in renewable energy. fuel energy sources. One of the most visit to Albania. farms is increasing. How exciting industry sources at present is the The markets are unpredictable do they impact life on the report Better Growth, Better Climate from the and turbulent. The Nord Pool boss has bottom of the sea? independent commission, New Climate certainly got that right. Not only are Economy. Dimitri Zenghelis empha- power prices low, but oil prices are also 13 sizes that it is possible to achieve both plummeting. The consequences are not SPECIAL FEATURE: economic growth and combat climate immediately obvious. Sufficiently low ETHICS A high ethical 34 change. However, at Statkraft’s Climate oil prices could also stimulate increased standard must permeate PEOPLE ON THE MOVE Roundtable at Vang Gård recently, he sales of less climate friendly energy the entire company. This Germany’s energy industry also stressed that time is not on our side. sources. Even though The U.S. and China is why new routines have is facing major changes. been prepared to clarify Claudia Gellert has an All of the necessary measures need to entered a historic agreement in Novem- roles and responsibilities. important job in showing have been taken within the next 15 years. ber to address climate change, results are In Peru, they have put the the authorities Statkraft’s For companies like Statkraft, the green a long way off. systems to the test. expertise. shift looks promising. We can create new Still, there are signs of optimism. value through clean energy. Business is poised to take a lead role, and During our climate meeting at Vang average citizens are realizing that climate Gård our CEO, Christian Rynning- change is a reality. We are now witness- 22 36 Tønnesen, was joined by a number of ing strong forces such as the ones that ALONE IN THE ANDES POWERTALK The CEO of other leading business figures. Siemens' Power Group chief Vidar Riber tells us Join us in a picturesque Nord Pool Spot, Mikael Lundin, has one message CEO of Wind Power and Renewables, about elsewhere in this issue of People journey to the Gallito Ciego power plant in the Peruvian – let the market do its Markus Tacke, says that the driving force & Power. In late summer the Norwegian Andes. Operations manager thing! In a matter of behind investments in renewable energy lake, Nedre Demmevatn, was full. Three Fernando Rodriguez looks years, the Nordic power is no longer politically motivated, but days later, all two billion litres of water after the control room, while exchange has become is now economic. Siemens is investing had disappeared. condors soar high above. the European leader.

Editor-in-chief: Bente E. Engesland Editor: Tone Dahle [email protected] / Lars Magnus Günther Editorial staff: Tone Dahle, Anders Berg-Hansen, Lars Magnus Günther, Gunilla Lundén, Judith Tranninger, Ursula John, Torbjørn Steen, Ellen Stai, Jenny Bull Tuhus, Inge Kvivik, Morten Ryen Layout and production: Fete typer Cover photo: Tommy Andresen Photo page 2: Shutterstock Printing: RK Grafisk AS Circulation: 5000 BENTE E. ENGESLAND We appreciate your input and feedback: [email protected] SENIOR VICE PRESIDENT, CORPORATE COMMUNICATION

2 STATKRAFT NO 4 2014 NO 4 2014 PEOPLE & POWER 3 CURRENT AFFAIRS POWER POWER

Statkraft has applied to the Norwegian Water and Energy PURE ENERGY In November, the U.S. and NEW AGREEMENT FOR SMALL-SCALE POWER PRODUCTION Resources Directorate (NVE) for a construction license for the China signed a climate agreement that calls for SMÅKRAFT AS will deliver a production-ready power plant at Haukeli­ new Nore 1 power plant in the Nore and Uvdal municipality. The massive investments in fjell in Odda municipality for Hydro Energi AS. The construction of the renewable energy. The Midtlægre small-scale power plant will commence in May 2015, and new power plant will have an increased production of about 80 agreement is regarded the plant will be ready for operation in September 2016. The plant will 1280 GWh, in part due to a slight increase in the elevation difference as an important step produce 13.8 Gwh, enough to supply 700 households. “We regard this towards a global climate project as a confirmation of our success in specialising in small-scale for the power plant and improved efficiency of modern turbines. agreement in 2015. hydropower,” says Rein Husebø, managing director of Småkraft AS. Morten Røsæg and Jan Helge Mårdalen Småkraft AS is owned by BKK, Agder Energi, Skagerak Energi, and of Hydro stand on each side of Småkraft The total new production is estimated at 1280 GWh/annually. Statkraft. AS’ Rein Husebø (centre).

Field trip NEW KNOWLEDGE

THE SWISS ALPINE CANTON OF VALAIS offers more than A total of 17 kilometres Sediment majestic vistas. The region is also home to the largest of tunnels have been pump-storage power plant under construction in research Europe, Nant de Drance. dug, and an equally underway The 900 MW power plant is co-owned by the Swiss awe-inspiring New global state railways, Schweizerische Bundesbahnen (SBB). In WHAT ROLE do sediments 2011, Statkraft entered into an agreement with SBB for 150-­metre long and 50 play for Statkraft’s power plants standard 150 MW of the capacity at the power plant for 15 years. around the world? The research Earlier this autumn, a delegation from Statkraft visited metre tall hall in in the project Future Sediment the construction site. Handling Strategy seeks to A NEW MANUAL for Operation and answer this question. The landscape at Lac d’Emosson, the lower reser- heart of the mountain. Maintenance (O&M) establishes a Sediment is coarse and fine voir, is postcard-worthy. The dimensions of the site are new global standard for how Power loose mass that travels along Generation (PG) operates in order to also impressive. A total of 17 kilometres of tunnels have creeks and rivers. All over the reach its objectives. been dug, and an equally awe-inspiring 150-metre long world, sediment presents a “The manual is a summary of our and 50 metre tall hall in in the heart of the mountain. challenge for hydropower plants, tools and best practice. It provides The Statkraft delegation, comprising Klaas Bauer- as it often fills up reservoirs and a template for how we work across mann, Atle Beisland, Bram Buis, Stefan-Jörg Göbel, reduces reservoir capacity. This technologies and geographies,” says Patrick Koch, and Claus Urbanke, received extensive is a significant issue in coun- executive vice president of Power insight into how the power plant will be when com- tries such as Peru, India, and Generation, Hilde Bakken. Albania where looser rock types pleted in 2017. At full capacity, in 2018, the Nant de The manual is based on four are more widespread. Sediment principles for PG operations: Safe Drance plant will generate about 2.5 Twh of electric- that does not sink travels with and prepared, optimised profitability, ity. It is expected that the plant will have a significant the water through the power employees with responsibilities, and impact on the Swiss energy market. plants, causing wear and tear continuous learning. Statkraft’s visit also marked the start of a new phase on turbines and waterways. The latter implies always striving in our partnership with SBB. As the operations phase The research project is a to improve. When we strive to keep draws ever closer, work is underway to draw up the collaboration between Power – and maintain – a world-class level, operational guidelines for the daily power dispatches. Generation and International the current situation is never good Hydro, supported by Innova- The companies will also explore possibilities for devel- enough. This is why PG, as a funda- tion’s Hydropower programme. oping more bespoke power trade agreements tied into mental principle, will always assess The project aims to spread and improve products, services and the 15-year agreement. knowledge exchange experience, processes. Swiss utility company Alpiq is the largest share- Impressive surroundings Patrick Koch, and develop new expertise. The manual will be implemented holder in Nant de Drance. Around two billion Swiss Atle Beisland and the project engineer in 2015. franc shave been invested in the project. on their field trip to the Swiss Alps.

4 STATKRAFT NO 4 2014 NO 4 2014 PEOPLE & POWER 5 CURRENT AFFAIRS LAKE NEDRE DEMMEVATN

The lake that On Friday 22 August, Lake Nedre Demmevatn was where it always had been. Three days later, all the water – two billion litres – was gone. DISAPPEARED Sissel Fantoft Statkraft and Tommy Andresen

Two billion litres of water disappeared from here in just three days

6 STATKRAFT NO 4 2014 NO 4 2014 PEOPLE & POWER 7 CURRENT AFFAIRS LAKE NEDRE DEMMEVATN

1 We lose 250 meters of elevation difference, Consequences When 6 3 which means a loss of money. If this is Lake Nedre Demmevatn (1) disappeared, the 2 permanent, we need to do something to water did not flow like it lead the water into the tunnel. should have through the tunnel to Lake Holme­ VIDAR RIBER, HEAD OF HARDANGER POWER PLANT GROUP vatnet, but under the Rembedalskåka glacier 1 tongue and into Lake Rembedalsvatnet (8). The Demmevasshytta cabin 5 7 (7) overlooks the lake 4 2 that disappeared. Hardangerjøkulen

Rembesdalskåka 1 Lake Nedre Demmevatnet

2 Lake Midtre Demmevatnet

8 3 Lake Øvre Demmevatnet

4 Bypass tunnel completed in 1899

5 Bypass tunnel completed in 1938

6 Tunnel to Lake Holmavatnet, completed in 1978

7 The Demmevasshytta cabin

8 Lake Rembesdalsvatnet 1 | Climate change Vidar Riber, head of Hardanger power plant group, got a real surprise when Lake Nedre Demmevatn disappeared over the course of one weekend. This natural phenomenon is a consequence of climate change. 2 | Empty Since the water disappeared, Lake Nedre Demmevatn has been empty, The opening under the glacier will probably close during winter, so that the lake is refilled when snow starts melting during spring.

n a clear Friday in August, a heli- “This is what happened in August,” says Vidar A powerful flood in 1893 caused significant and Energy Directorate (NVE) believes cli- GREAT FORCES AT PLAY Elvehøy believes FACT BOX copter flies across the Sima Valley Riber, head of Hardanger power plant group. damage, and led to a 380-metre long bypass mate change is the cause of the disappear- the tunnel created by the water through the The Hardangerjøkulen glacier in Eidfjord. On board is builder “The hot summer caused heavy melting tunnel being blasted in 1899 to prevent future ance of Lake Nedre Demmevatn in August. ice will close during the winter. He also thinks Harald Kleiveland and two of his on the glacier, at the same time as the water disasters. “The thickness of the glacier tongue that we will see a jökulhlaup again. However, Ocarpenters, as well as a load of materials. temperature rose,” says Riber. “The combi- “In 1937, the tunnel was clogged, and there Rembesdalskåka varies with the climate,” when and where is difficult to predict. > Norway's sixth largest glacier, located They have been hired by the local trekking nation of thin ice and warmer water enabled was a new, major disaster,” says Riber. “In four explains Elvehøy. “During the Little Ice Age “We need to be prepared for this to happen in Ulvik and Eidfjord municipalities in association to repair the woodshed at the the water to melt a channel under the or five hours, 12 billion litres of water flooded around 1750, the glacial front ran halfway again,” he says. “There is a clear connection Hordaland County, in the very north of cabin by Lake Demmevatn. Rembesdalskåka glacier tongue. As a result, the Sima Valley, taking houses and fields with out into what is Lake Rembesdalsvatnet with climate change, and an issue we will see the Hardangervidda mountain plateau. ­ “From the helicopter we could see all the water disappeared over the course them. It destroyed the entire valley.” today, but since the 1800s it has gradually more of in the future, both for power plants At its thickest, the glacier is 380 Lake Nedre Demmevatn below us,” says of a few hours, and ended up in Statkraft’s In 1938, a new bypass tunnel was ready. shrunk.” and unregulated waterways. It all depends on > metres thick. Kleivedal, who seized the photo opportunity. reservoir Lake Rembesdalsvatn. This lowered the water level in Lake Nedre The influx of local water and glacial the terrain under the glacier, and we do not On Saturday, he also took pictures of seven Statkraft’s readings, which show how the Demmevatn. water ensures that Lake Nedre Demmevatn know how this is until the glacier pulls back. > The glacier has shrunk significantly hikers who were walking along the lake. water from Lake Nedre Demmevatn flooded “Since then, Lake Nedre Demmevatn has will always be refilled. The only thing we can do is to monitor the during the 1900s. The front of the gla- “But the next time we looked down on into Lake Rembesdalsvatnet over a few been but a puddle,” says Riber. “A lot less “When Rembesdalskåka was larger, glacier’s development.” cier has pulled back several ­hundred the lake, it was gone. A very strange expe- hours, were initially ignored because they water, and the reservoir in Lake Rembes- water followed a route over the ice or along Elvehøy says that if people had been pres- metres. In 1925, the top of the glacier was at 1876 metres above the sea. In rience!” were unrealistic. dalsvatn, has removed the risk of any major the glacier’s edge when Lake Nedre Dem- ent where the jökulhlaup occurred at Lake 1995, it had shrunk to 1863 metres. The only sign that not all was as it should “The figures showed that the water level floods.” mevatn flooded,” he adds. “However, when Nedre Demmevatn, the outcome might have be this late summer weekend was a loud rose significantly over a few hours in the However, the disappearing lake has had the water ran underneath the ice, and all the been much more dramatic. noise from the Rembesdalskåka glacier morning on Monday, 25 August,” says Riber. consequences for Statkraft. water disappeared in a short period of time, “It all happens so fast. You might hear a FACT BOX tongue. “All in all, a couple of billion litres disap- “It means the loss of 250 meters of jökulhlaup occurred, causing major flood loud bang, and then the water comes rush- Jøkulhlaup peared from Lake Nedre Demmevatn.” elevation difference, which means a loss of disasters.” ing,” he says. Elvehøy believes the loud noise DID NOT BELIEVE THE READINGS money,” says Riber. “If this is permanent, we In the 1900s, the glacier shrunk even Kleivedal heard could have been the glacial Historical sources tell tales of major flood In need to do something to lead the water into more, causing the 1937 disaster. “As the new front collapsing. The glacial front was 40 to 50 LOSS OF ELEVATION DIFFERENCE An Icelandic term that has been adopted disasters in the Sima Valley, caused by the past, the people of the Sima Valley were the tunnel.” tunnel was ready, the water level in Lake metres high, and was supported by the water into the English language. It describes any jökulhlaup – a term used for flash floods used to floods every late summer, as water Nedre Demmevatn was lowered 50 metres,” in the lake. When the water disappeared, large and abrupt release of water from a that occur when trapped water finds a way would lift Rembesdalskåka and flow down ICE IS SHRINKING Senior engineer Hallgeir says Elvehøy. “Everything was nice and the front became unstable and eventually sub glacial or pro glacial lake/reservoir. under the glacier. to Lake Rembesdalsvatn, which flooded. Elvehøy of the Norwegian Water Resources quiet, until this summer.” collapsed. Source. Store norske leksikon

8 STATKRAFT NO 4 2014 NO 4 2014 PEOPLE & POWER 9 CURRENT AFFAIRS HSE

Banje, Albania, 23 October, 11.39 hours Inspection Managing director of Devoll Hydropower, Ola By, president and CEO Christian Rynning-Tønnesen, and HSE manager of DHP, Nikolas Garnett, inspect the Banje site.

resident and CEO Christian the safety work,” Garnett says. “This must Rynning-Tønnesen had person- improve, and it is improving.” ally requested that his first visit to He admits that progress is slow. Focus is Lifting the Devoll development project in When the CEO of a on being visibly present on the construction PAlbania would also be a Health Safety Envi- site, improving safety step-by-step, and ronment (HSE) inspection. In line with the company arrives at a site, changing attitudes and HSE culture at all company’s priorities for 2015. levels. Among the things the CEO saw at the sees something wrong, “Our HSE efforts to prevent injuries, site, were unsecured working practices and then gives a talk about accidents and undesirable consequences at heights, a crane lift with an improperly depend on errors being corrected – often that secured load, and active workers below the it afterwards, he is sending a colleague cares. The ability and will to care SAFETY hanging load. is an important part of any HSE culture, and “I am very pleased with the organi- a very important signal. is what will lead to change – at all levels.” A construction worker looks with uncertainty for the safety equipment he left sation of the construction work and the behind before he climbed the scaffolding. Meanwhile, a load of sheathing is lifted up progress demonstrated. However, I am far SAFETY BOOT CAMP One idea that from pleased with safety at the power plant came up during the visit was to establish a over the heads of working colleagues without double protection in place. construction site,” the CEO told employees CHANGING ATTITUDES Garnett thinks it “safety boot camp”, based on what has been of Devoll Hydropower in Tirana after being is good that the top executives from Oslo get done in Cetin, Turkey. There, all person- alarmed by the irregular lifting operation. to experience the realities of construction nel working on site must complete a boot Lars Magnus Günther Agim Dobi / Statkraft “I am very glad he saw this, and that sites in countries where safety is not given camp focusing on fundamental knowledge, he commented on it,” says HSE supervisor the same high priority as in Western Europe including scaffolding, lifting operations, for- Nikolas Garnett, who served as a guide for and Scandinavia. bidden areas, and falling accidents. Unless the CEO during the visit. “When the CEO of “Incidents like this show the importance they complete each section, they will not be a company arrives at a site, sees something of actively involving the sub-contractor’s allowed on site. wrong, and then gives a talk about it after- management on site, and that workers “Safety in Albania is still in its infancy,” wards, he is sending a very important signal.” must be allowed to take an active part in Garnett says. “Many unskilled labourers

10 STATKRAFT NO 4 2014 NO 4 2014 PEOPLE & POWER 11 CURRENT AFFAIRS HSE

FEATURE ETHICS

CURRENT AFFAIRS HSE Albania Hectic activity The dam for the Banje power plant is halfway completed. Filling of the reservoir will start before Christmas next year.

THE DEVOLL PROJECT com- prises two power plants, Banje (70 MW) and Mogliche (186 lack basic knowledge and awareness of building is well under way. The preparations MW). They will be completed in 2016 and 2018, respectively. safety, simply because no one has ever for the largest facility, Mogliche, is under The plants will generate about taught them safe working methods.” way further up the Devoll valley. 730 GWh annually, and increase “Adjustment over a long period of time Filling of the 15-kilometre long reservoir Albania’s total power production has accustomed us and made us comfort- will begin towards the end of next year. by 17 per cent. The invest- able with safe work processes and safety The Banje power plant is expected to start ments in the project total EUR “A high ethical standard rules. However, for the boys on site, it can operation in the summer of 2016. By then, 535 million. be difficult to suddenly be confronted with replacement roads must be completed to will permeate all of our new rules and methods, even if they are provide residents of the Devoll valley with BOTH POWER PLANTS will have separate smaller turbines, designed to protect them. A boot camp a new road to the north, as the existing road activities,” says president able to generate power at the could be a very useful tool for us.” will be under water. This is the responsibility required minimum water level. and CEO Christian of the authorities, and an important issue Rynning-Tønnesen. New HIGH ACTIVITY LEVEL Despite challenges during the talks between the CEO and Alba- THE LICENSE AGREEMENT in terms of HSE, the president and CEO also nian government officials during the visit. grants Statkraft the right to sell guidelines have been witnessed many positive things. The con- During the talks, it also emerged that the the power freely, including as ex- struction site is teeming with activity, with a Albanian government is looking to carry out port power to adjacent markets. prepared as part of the constant stream of trucks moving from the highly needed reforms in the energy sector. efforts to further develop upstream riverbed filled with new mass for The electricity grid experiences almost THE PROJECT is executed by Devoll Hydropower, a fully owned the dam that grows every day. In little over 50 per cent loss due to theft, lack of meter- a safe and open culture subsidiary of Statkraft, with a year, the 80-metre tall and 900-metre ing, and natural grid losses. It is clear to approx. 70 employees at the for whistleblowing. We long dam will be complete. The spillway is everyone that something must be done. At offices in Tirana, in Gramsh, and already completely poured. Down in the the same time, more rapid deregulation and on site. are also experiencing construction pit, the Banje power station is increased power exchange with Albania’s increased external taking shape. The outflow pipes are in place, neighbours is needed to attract more foreign A CONSORTIUM comprising and the pouring of the concrete for the basic investments in the energy sector. Turkey’s Limak and AGE is the pressure relating to main contractor for the project, while the units are supplied by transparency and robust France’s Alstom. systems. DEVOLL HYDROPOWER assumed ACCIDENT IN PANAMA On Thursday 20 November, Statkraft experienced a new fatal accident when HSE responsibility from Owner’s a tank loosened under a crane lift and hit two workers at Agua Imara’s hydropower project Bajo Frio in Engineer in June, and is currently Panama. One of the workers died, while the other was seriously injured. The accident is a tragic reminder of training seven Albanian employ- the importance of good planning and an intensified focus of working safely at our development projects. ees to UK standards.

12 STATKRAFT NO 4 2014 NO 4 2014 PEOPLE & POWER 13 FEATURE ETHICS

A solid foundation

“Statkraft’s ground rules – our INTEGRITY HELPLINE Code of Conduct – are the very Do you need advice on foundation on which our entire ethical issues? Contact [email protected] enterprise is based, together with our vision and our values,” says president and CEO Christian Rynning-Tønnesen.

“Our Code of Conduct empha- sises the importance of the safety of our employees, our responsi- bility to protect the environment, and our corporate responsi- bility, amongst other things,” Rynning-Tønnesen says. “The Code of Conduct is a doc- Ethics umented set of rules we expect all impact everything we do employees to comply with,” he says. “Supervisors and managers have a particular responsibil- It used to be that companies demonstrated corporate ity to ensure that all activities ­responsibility (CR) through sponsorships and charity within their area of responsibility are performed in accordance work. Now, CR is about doing business in an honest and with the Code of Conduct and other requirements. Our values sustainable manner, which also adds value to the company will only have meaning if we and leads to improved results. follow them. Because of this, it is extremely important that you report any violations of the Code Morten Ryen Tommy Andresen of Conduct that you discover.” The company now has guide- lines for how employees should report any concerns and how the orporate responsibility and business comprises everything from the environment ship. Additionally, sustainability performance consequences of the project are handled well.” challenges related to combatting corrup- line managers will handle these. ethics comprise a vast number of and climate, social obligations and human could also have a direct impact on access to Establishing a reservoir will often require tion and unethical business practices,” says As well, there are now guidelines fields, and are relevant to all aspects rights, labor rights, health and safety and capital.” displacing people. International standards are Groux Nürnberg. “This includes everything for how to carry out internal of our business,” says Rachel Groux health to anti-corruption and combatting There are responsibility and sustainability established to safeguard the rights of those from the limits on gifts or advantages from investigations. These are tools that CNürnberg, head of the CR & HSE unit and white-collar crime. It is a very wide field, and requirements for funding of international affected, and to ensure that they receive suffi- partners, to how we make sure that our will provide safety for all parties integrity officer in Statkraft. She heads a Statkraft takes all these aspects seriously.” projects under the Equator Principles, and cient compensation for the affected property. contractors comply with our principles.” involved in an issue. team of 15 people who work closely with a the World Bank (through the International By following international best practice in As a main principle, Statkraft employ- “Statkraft has established a number of experts from the line to support INTERNATIONAL CHALLENGES Statkraft Finance Corporation) has requirements that the field, the objective is to ensure that the ees should not accept gifts or perks from solid foundation with an uncom- compliance with social corporate respon- has gone from being a predominantly must be met before granting loans. living conditions for those affected are better partners or suppliers, and we also have strict promisingly high ethical stand- sibility and health, safety and the environ- Norwegian company, to having a true global after the development than before. We are rules for what we can offer our partners in ard,” says Rynning-Tønnesen. ment guidelines. The unit has an important presence. This means new challenges, new PRACTICAL CHALLENGES “The ethical also working on management systems that terms of hospitality and business perks. “We are known as a proper and function in establishing policies, as well as cultures, different laws and regulations – challenges are different in various parts of will enable us to follow up on the results of trustworthy company. People trust providing the line with advice and support but also increased expectations. the company,” she says. “However, the fun- measures that are implemented. GET IN TOUCH “We receive many ques- Statkraft. It is up to all of us to for all of these areas. “The primary driving force in the CR damental principles remain the same across If ethnic minorities or indigenous peoples tions on how employees can handle the continue this culture and bring it development is the expectations from all sections.” are affected by our activities, we are obligated many grey areas that occur,” says Groux with us wherever we do business. NOT CHARITY “In the past, CR could partners, banks, authorities, owners and the Statkraft regularly meets challenges to carry out consultations in a way that is Nürnberg. “As a rule of thumb, we follow We cannot afford to be naive on include building a school, drilling for drink- public. Ignoring corporate responsibility is linked to compliance of CR and HSE adapted to the local culture, enabling us to the norms that set the highest behaviour this issue.” ing water, or sponsoring local activities,” says no longer an option,” says Groux Nürnberg. requirements. “For example, a hydropower secure good agreements. standards. You can also contact the HSE Groux Nürnberg. “This is a very narrow defi- “Many of Statkraft’s business partners have development will usually impact the local manager or one of Statkraft’s integrity nition and we do not use it any more. Now, clear CR and HSE performance and system population,” says Groux Nürnberg. “That HOSPITALITY AND CORRUPTION managers. You can also get in touch with us CR is an integral part of our enterprise, and requirements before entering into a partner- means we have to ensure that any negative “Another relevant example is Statkraft’s to make an assessment.”

14 STATKRAFT NO 4 2014 FEATURE ETHICS

tatkraft is like a society in itself, with laws, rules one of Statkraft’s integrity officers and can also seek FACT BOX and norms to prevent undesirable, unethical the advice from Corporate Audit. As a main rule, minor Digital or criminal behaviour. In Statkraft, these are issues can be handled by the line, while more serious whistleblowing Never sit on a case summarised in our own ground rules, the Code issues must be elevated immediately to Corporate Audit. channel Sof Conduct, which all employees must be familiar with. “The most important factor is that we always take As in society, someone will break the rules without reports seriously, even if it should turn out to be a minor Money under the table. Harassment at work. A subcontractor dumping intending to – sometimes on purpose, other times inad- thing or just gossip,” she says. vertently. No matter what, such violations can be illegal In order to create the necessary credibility and trust Statkraft has had a whistleblowing channel hazardous waste. “Anyone who discovers violations of laws, rules or and harmful for the company and for individuals. It is in an investigation, it is important that an independent for 10 years. In order to ethical principles has the right and responsibility to report this,” says therefore important that they are handled well. unit carry out the investigation. Corporate Audit is inde- strengthen the principle pendent, and has both experience and good procedures. of anonymity, Statkraft Tone Skuterud, head of Corporate Audit. NOTIFY “In order to safeguard Statkraft’s strong eth- “An investigation is about creating a fair, open and has now introduced ical culture, it is important that we are all aware of our objective process that identifies the facts and secures a new technological right and obligation to report violations of our ethical evidence,” Skuterud says. solution that guaran- Morten Ryen Tommy Andresen principles, laws and rules,” Skuterud says. tees full anonymity. “As a main rule, all reporting must be done to ANONYMITY GUARANTEED Everyone involved is guar- The main principle is that whistleblowing is someone in the line, either your immediate supervisor, anteed anonymity if they wish – no matter who files the done to someone in or to other line resources, such as the HR supervisor or report, who receives the report, or the subject of the report. the line, either to your integrity managers. If for some reason, you are unable “Both managers in general and Corporate Audit need immediate supervisor to, or do not want to, report to anyone in the line to be aware of their responsibility in this regard,” says or other line resources, management, you can contact the independent whis- Skuterud. “For instance, a manager must safeguard the such as the HR manager tleblowing channel managed by Corporate Audit. The anonymity of the whistleblower from his or her own or integrity managers. unit has been Statkraft’s independent whistleblow- supervisor unless otherwise agreed with the whistle- If you for some reason ing channel for more than 10 years, and anonymous blower. Anonymity and strict confidentiality are impor- are unable, or unwilling, whistleblowing has been possible by Corporate Audit, tant, not just out of consideration for the whistleblower, to go by way of the line, you can file your report ensuring the anonymity of the whistleblower. but also in order to protect the individual who is the sub- via the independent In order to strengthen the principle of anonym- ject of the report. Here, as in the justice system, the princi- whistleblowing channel ity, Corporate Audit has now made use of a technical ple is that everyone is innocent until proven otherwise.” managed by Corporate solution, which ensures complete anonymity, whether Audit. The channel is through our intranet “The Stream” or our external FEEL SAFE Many employees worry that they might get open to all. Read more CORPORATE AUDIT is website Statkraft.com. a certain reputation, be threatened or even lose their job about it on the Intranet an independent and “The technical solution is an improvement, but if they report. No one should fear such consequences in or statkraft.com. objective quality assur- the whistleblowing principle remains the same,” says Statkraft, Skuterud stresses. www.statkraft.com/ ance and consulting Skute­rud. “We are naturally aware that different coun- “We want a culture of openness, where you can report about-statkraft/ function, with the goal tries have different laws and regulations in connection a concern without worrying that you might lose your of contributing to the Whistle-blower-channel/ with whistleblowing, and handling the protection of job,” she says. “However, I have complete understanding continuous improvement personal information in connection with investiga- that some might feel unsafe in such a situation, and this is of Statkraft’s activities. The head of Corporate tions. We solve this through our handling of cases.” why we have made use of a new technological solution on Audit is also responsible our website that ensures complete anonymity. No one can for Statkraft’s whistle- HELP FOR MANAGERS “Experience has shown track you, and you can monitor the development of the blowing channel, and that most reports are submitted to line management, issue without revealing your identity.” the first recipient of all usually to the immediate supervisor. As a result, the So far, Corporate Audit has not received many reports. issues reported through line managers have a great responsibility to ensure that This might be seen as positive, that there are not many this channel. the whistleblower’s concerns are taken seriously and issues to report, but this is not necessarily the case. handled properly,” Skuterud says. “It is far more likely that we have not received The way in which managers handle these situations reports, either because there is not sufficient aware- is decisive for the culture Statkraft is enable to cultivate. ness of the whistleblowing channels, or that issues that “Employees will not raise concerns unless they are should have been reported, have been handled locally or confident that their concern will be handled well,” says archived,” says Skuterud. “This is not what we want. We Skuterud. “A manager who receives a reported concern want a better overview of undesirable issues, to ensure must always take it seriously and never sit on a case,” that we, as a company, are handling them well.” she adds, stressing that no one should instigate an At the same time, Skuterud is very pleased that a high investigation on their own. share of the respondents in the most recent employee Statkraft has prepared new procedures that describe survey said they would report violations of the Code of how line managers should act when they receive a Conduct if they saw them. reported concern. The new procedure consists of six “This is the starting point we need. Now we must points that are meant to help managers assess the seri- continue to build on this, and ensure that we increase ousness of an issue and how to handle it. Leaders can awareness and understanding of our new whistleblow- and should always discuss the handling of cases with ing routines,” Skuterud says.

16 STATKRAFT NO 4 2014 NO 4 2014 PEOPLE & POWER 17 FEATURE ETHICS

The leak “We do not that was not supposed to negotiate happen

IN MARCH this year, it was discov- on ethics!” ered that documents containing confidential HR information in Statkraft Peru had been leaked to unauthorised people. “There are different views on what constitute good business “What happened was that someone had gained access to a ethics in Peru. And for this very reason it is important that document with sensitive infor- we are clear on our principles and standards,” says Juan mation and distributed this inter- nally and externally,” country Antonio Rozas, country manager Statkraft Peru. manager Juan Antonio Rozas says. The leak was discovered thanks to loyal employees who Morten Ryen Jimmy Linus reported it as a violation of the Code of Conduct.

INVESTIGATION Through ntonia Rozas, who has been with information campaigns and drills, something interviews and reviews of the Statkraft/SN Power since 2008, we will continue doing.” computer system, the culprit was believes the company has to be identified. consistent in words and action, MANAGEMENT DEVELOPMENT Managers “Statkraft’s head office was andA be steadfast with its own integrity. “In are important in order to create the desired informed about the issue, and the Statkraft, ethics are non-negotiable.” culture in Statkraft Peru at all levels, Rozas process was carried out in accord- points out. ance with legislation and rules,” TAKE CARE OF OUR REPUTATION “We must ensure that managers are well Rozas says. “Great emphasis was “It is very important that we send a clear aware of the whistleblowing rules, and that placed on securing the anonym- message to all employees on applicable they have the knowledge and capability ity of the whistleblowers, at the standards and the expectations we have,” necessary to handle this type of issue in a same time as we expressed our says Rozas. “Our internal reputation does good manner,” he says. “We start during the gratitude to them.” impact our external reputation.” recruitment process by stressing how impor- He says they have made considerable tant sound business ethics are in Statkraft, and LESSONS LEARNED The case efforts in creating a culture of responsibility how values and ethical principles govern our uncovered challenges in con- in Statkraft Peru, a culture that is so open enterprise. We also organise workshops each nection with computer security that people feel safe reporting undesirable year for managers to hone their knowledge in the company, and the inves- behaviour. of the ethical principles. We recently held Culture for ethics Statkraft Peru works actively to build and strengthen a culture of responsibility and openness among all employees. tigation also identified instances “We stress that each employee has a sep- anti-corruption training in partnership with of undesirable and unethical arate responsibility to contribute to a safe the head office.” behaviour. and positive working environment, where “Management decided on they can do a good job in safe conditions. BUILDING A CULTURE TAKES TIME Rozas disciplinary action, and some It must also be safe to report any noncon- stresses that building a culture does not happen employees were let go,” Rozas formities with rules and laws. All employees overnight, or even in a year. It takes time. confirms. “This leak provided us must know how to report and notify their “Therefore, one of our goals for 2015 is to with the opportunity to once more immediate supervisors, or if necessary, how strengthen our work to create a culture that It is very important that we send a clear stress the importance of our Code to contact the head office. promotes individual responsibility,” says Rozas. Juan Antonio Rozas, message to all employees on applicable standards of Conduct to our employees.” “In order to raise awareness and knowl- “We want to create a climate where employees country manager, edge of this, we have carried out internal feel safe to openly report nonconformities.” Statkraft Peru. and the expectations we have.

18 STATKRAFT NO 4 2014 FEATURE ETHICS

Especially in the cafeteria or on the bus it is easy to forget that you have information that is not yet public.

JOHN FAHS, HEAD OF THE MARKET REGULATIONS COMPLIANCE TEAM

Transparencycreates trust

New EU rules will provide more transparency for market transactions and reduce the risk of insider trading and market manipulation. Statkraft’s new market STATKRAFT’S MARKET REGULATIONS COMPLIANCE regulations compliance team will ensure that these rules are complied with. TEAM consists of specialists Anya Bissesur, Marek Dal- Canton and John Fahs, who Morten Ryen Tommy Andresen heads the team.

ut briefly, the purpose of the new FACT BOX part to financial instruments and in part to to put up collateral for such transactions in twice, first in Europe and then in Norway.” tell our own power traders that a certain rules is to build trust in robust and New EU regulations energy products. order to reduce the risk. New laws and regulations set new require- hydropower plant is shutting down without transparent markets. One of the lessons learned was that the All trades must also be reported to a ments for procedures, policy and routines. telling the entire market at the same time. We “This will benefit market players, many bilateral financial transactions entered trade repository no later than one day after For this reason, Statkraft has made exten- must be completely open and give the same Pcompanies, customers and owners in the into outside of the stock exchanges, which the trade has been completed. sive internal efforts to increase awareness information to everyone – at the same time.” long term – we welcome the new regulations EMIR (European Market Infrastructure market players enter into as a matter of The EU has also introduced specific rules and knowledge of the new regulations. and are focused on compliance,” says John Regulation) ensures transparency in the course, could provide increased uncertainty. for the energy market, such as the Regulation “We have spent considerable time and BE CAUTIOUS! Insider information is often market, and reduces the market risk of Fahs, head of the new market regulations “When Lehman folded, there was spec- on Wholesale Energy Market Integrity and effort on REMIT training in the past year, and associated with fraud or market manipulation bilateral trades with financial instruments. compliance team tasked with ensuring Stat- ulation about which counterparties Lehman Transparency (REMIT). The objective of REMIT we have had around 400 people on training for profit. However, according to Fahs, there is kraft’s compliance with the new regulations. Brothers had entered into such bilateral is to create trust in the markets by preventing courses,” says Fahs. “We are also working an equally large risk of an unintended leak. REMIT (Regulation of Energy Markets Integrity and Transparency) is an EU regu- transactions with,” says Fahs. “What the insider trading and market manipulation. on creating an e-learning platform, where “When a power plant is shut down, LESSONS FROM THE FINANCIAL CRISIS lation framework specifically for the energy market was wondering was if Lehman owed employees can complete various modules insider rules might not be the first thing that It all started in 2008. Many people were market. It ensures integrity and transpar- vast sums to some of these counterparties, OUTSIDE THE EU As Norway is not part and test their knowledge.” springs to mind. Especially in the cafeteria unpleasantly surprised when the major ency, as well as preventing insider trading and as a result, if some of these counterpar- of the EU, the regulations do not apply to Not everyone in Statkraft needs detailed or on the bus it’s easy to forget that you have American bank Lehman Brothers went bank- and market manipulation in the European ties were also on the brink of bankruptcy. Norwegian companies yet. The regulations knowledge of the new regulations, but information that is not yet public,” Fahs says. rupt, and a lack of trust spread in the financial energy market. Fear continued to spread.” will, most likely, be introduced through everyone who may be affected by them It is not always easy to know what consti- markets. The ripple effect was severe for EFTA (European Free Trade Association). should receive training. tutes sensitive insider information, and we all global business and the world at large. In some MAR (Market Abuse Regulations) is a PROVIDE INCREASED SECURITY The Meanwhile, Statkraft has chosen to treat make mistakes. parts of the market, it turned out that a lack of regulation that is not yet adopted, but is new European regulation, which aims the regulations as if they already apply in BE ATTENTIVE! “If we are to achieve “What is important is that we create a cul- meant to protect players against insider transparency was the worst enemy of trust. to increase transparency and reduce the Norway where it is feasible to do so. an open and fair European energy mar- ture for erring on the side of caution when we trading and market manipulation in finan- “There was a tremendous sense of fear in spread of risk during such economic crises, “Statkraft is active in many markets, and ket, market players cannot be permitted are in contact with sensitive market informa- cial markets. the market, which only escalated the crisis,” is called European Market Infrastructure does significant business in the European to manipulate the markets or be given tion,” says Fahs. “If you have any doubts on says Fahs. Regulation (EMIR). The EMIR regulation markets,” says Fahs. “The new regula- market information ahead of others,” says how to handle certain information, or think MiFID II (Market in Financial Instruments In order to mitigate the negative ripple Directive II) will regulate companies that encourages market players to trade on the tions require extensive reporting and risk Fahs. “Statkraft is a major player that both you might have leaked insider information by effects of such large bankruptcies, the EU has need licences (in Norway, from the Norwe- exchanges or settle trades using clearing management, which would have made it produces and trades electricity. Sometimes mistake, please contact us. We have a team of introduced a number of new regulations for gian Financial Authority) to perform servic- houses. Traditional bilateral trades are still impractical – and probably more costly – if Statkraft has insider information that may experts who know the regulations and how international trade. The regulations apply in es and trade with financial instruments. allowed, but now larger counterparties need we had to introduce the new regulations impact the market. For instance, we can’t to practise them, and we are here to help.”

20 STATKRAFT NO 4 2014 NO 4 2014 PEOPLE & POWER 21 PHOTO FEATURE GALLITO CIEGO

A small cockerel in the realm of the condor

The Pacific never gets closer to Peru’s Andes Mountains than in the La Libertad region. Here, the endangered condor flies high above the power plant named after the small, blind cockerel Gallito Ciego. The rainwater collected in the massive dam on the floor of the valley has transformed this arid land into a fertile agricultural landscape.

Ellen Stai Jimmy Linus

22 STATKRAFT NO 4 2014 NO 4 2014 PEOPLE & POWER 23 FOTOREPORTASJENPHOTO FEATURE GALLITO GALLITO CIEGO CIEGO

1

2 1 | Fernando Rodriguez enjoys working alone in the control room. 2 | The operations supervisors at the power plant cooperate with local farmers on when to release water for irrigation purposes. They meet about once a month, more often during dry periods. 3 | 2014 is an unusually dry year. It has not been possible to fill the 112-metre dam with rain water.

ont lean on the red button, you’ll set off the alarm!” warns operations manager Fernando Rodriguez. The Gallito Ciego hydropower plant, acquired by SN Power in 2003 and transferred to Statkraft earlier this summer, is fully automated and requires only one person to be work- Ding in the control room. Fernando monitors all the processes on his computer screens. He and his colleague, Jorge Paz, take turns working. They never work at the same time. It makes for lonely hours in front of the many screens. At the power plant where Fernando used to work, he had to be constantly on the lookout for attacks from the guerrilla movement Shining Path that until a few years ago terrorised large parts of Peru. “Sometimes it was all a bit too exciting,” he says. So it’s perhaps not so strange that he appreciates the silence in the peaceful and lush Jequetepeque Valley, framed by majestic mountains. The drive from the coast cuts through a sandy and rocky desert landscape, but as you enter the valley, you are greeted by grazing cattle, giant avocados and trees full of bananas, mangos and papaya. The river that runs through the valley is why the area is so fertile – the river, and the massive dam that pro- vides both the power plant and the local farms with a regular influx of water. “Where I used to work, we had to replace the turbines several times in a year, but here there is no need because the water is so clear,” Rodriguez says. 3 There is not much to do here, other than ensuring that everything is running smoothly. The days have their own pace. In the mornings, sisters Yeimi and Viviana Correa stop by to cook and do laundry before returning to their families in the nearby village. Fernando Rodriguez’ family is far away. He has four grown children. When he is home with his wife, he does not want to go back. But once at work, he quickly settles in. Deer graze on the shrubbery surrounding the power plant, unaware of the hungry eyes from the impressive condor up in the sky. In the control room of the power plant named after a blind cockerel, Fernando is his own master.

24 STATKRAFT NO 4 2014 NO 4 2014 PEOPLE & POWER 25 PHOTO FEATURE GALLITO CIEGO

3

1

2

1 | Artificial irrigation is necessary to make the dry landscape fertile. The power plant is located downstream from the Gallito Ciego dam, which is mainly used for irrigation purposes. 2 | Sisters Yeimi (left.) and Viviana Correa make sure everything is in top condition for the operations supervisors and visitors from the main office in Lima. 3 | Jorge Paz is the other operations supervisor. He and Rodriguez never share the same watch. When the shift is over, it is nice to relax in the room.

26 STATKRAFT NO 4 2014 NO 4 2014 PEOPLE & POWER 27 THE STATKRAFT SCHOOL STAGE-GATE

THE STATKRAFT SCHOOL STAGE-GATE

PHASE 0 SCREENING Prepa- ration work designed GATE PHASE 0: GATE PHASE 1: to identify and SCREENING PRE-FEASIBILITY/ uncover business Step by step ASSESSMENT opportunities and generate new ideas. Various business areas, many countries, and major projects. It goes without PHASE 1 saying that an organisation like Statkraft needs good tools to make decisions and PRE-FEASIBILITY/ ASSESSMENT execute projects. This is why Stage-Gate was introduced in the company in 2011. A quick and affordable pre-study of the project – Sissel Fantoft Annette Holm Grøsland Morten Brun mainly based on desk research. GATE PHASE 2 FEASIBILITY/ ll projects in Statkraft, regardless of and Statkraft has selected the Stage-Gate FACT BOX PERMIT Detailed size and business area, must use the model to ensure this.” PMO study involving Stage-Gate model. Stage-Gate is one of the most used both technical and “Stage-Gate is not primarily a formal innovation processes in the world. commercial issues, projectA execution model, but an investment Canadian Robert G. Cooper developed it in addition to PHASE 3: and decision-making model, that provides more than 25 years ago. Almost 80 per PROJECT MANAGEMENT OFFICE regulatory processes GATE (PMO) is responsible for overall project TENDER/ PHASE 2: the framework for the necessary deci- cent of all U.S. companies now use the and possibly local ENGINEERING FEASIBILITY/PERMIT methodology, project management tools, pre-studies. sion-making basis at the various stages of a model. In Norway, companies such as Sta- project-technical training, and transfer of project,” says Pål Otto Eide. toil and Telenor, in addition to ­Statkraft, experience among projects in Statkraft. In October, he started in the position have applied it to their activities. PHASE 3 as head of the Project Management Office “Our major, international projects face TENDER/­ THE UNIT was established in 2010, and was previously managed by Power ENGINEERING (PMO). One of the main tasks of the PMO is many challenges. It is therefore important Generation (PG), but this spring, it Specific design and to ensure sound project execution in Stat- that we establish best practice for how to DECISION GATE Ahead of each phase, the project passes was transferred to International Hydro development of the kraft. The framework for this is Stage-Gate. work,” Eide says. an evaluation point (gate). Each gate is designed in Projects & Construction (IPC). project, including the the same format: DELIVERABLES Project manager and procurement process WIDELY USED “There are a lot of similar- PROVIDES GOOD CONTROL The Stage- team provide the decision-makers (gatekeepers) with the PMO has been granted a mandate from necessary to secure ities and differences between the various Gate model is used to make decisions, results of the activities completed in the preceding stage. the executive management to ensure a the deliveries for CRITERIA The project is assessed based on a defined set business areas in Statkraft, but they all have both in terms of the design of the project, common platform for project execution. the execution of the of robust success criteria. OUTPUTS A decision is made a strong desire to improve their project and the necessary documentation for PMO is supported in this work by a refer- project. whether to continue the project, put it on hold, or abort. execution,” Eide explains. “In order to project approval and the funding needed ence group with representatives ­fromwall Source: Stage-Gate International achieve this, we need a good framework, for execution. “Stage-Gate comprises business areas. PHASE 4 CONSTRUCTION The GATE actual realisation or construction phase of the project.

PHASE 5 GATE PHASE 5: PHASE 4: OPERATION OPERATION The project is CONSTRUCTION ­completed and enters operation.

28 STATKRAFT NO 4 2014 NO 4 2014 PEOPLE & POWER 29 THE STATKRAFT SCHOOL STAGE-GATE CURRENT AFFAIRS GOOD NEIGHBOURS

WHAT IT IS:­ Offshore wind farms are a fairly new phenomenon, and we know too little about how the Pål Otto Eide, head of the Project foundations for the turbines impact Management Office (PMO). marine life. This is why Statkraft is contributing to research on the area.

various phases and assessment points, decision-making process across the com- FACT BOX or Decision Gates, where management at pany. All major projects must be assessed Pål Otto Eide various levels, depending on the investment by members of the executive management frame of the project, assess if the project team, and it is decisive that they have a uni- should continue,” says Eide. “The method form basis with common definitions before STARTED in the position as head of the Crustaceans such as lobster and crab seem to thrive on the wind turbine fundations. provides management with good control making a possible decision to execute,” Eide Project Management Office in October. of project process, and helps create distinct points out. HAS A MASTER of Science degree from areas of responsibility and objectives.” Managing major projects can be exhaust- the Norwegian University of Science and In order to support the Stage-Gate model, ing. PMO supports the business areas with Technology (NTNU) and has worked in GOOD Statkraft has established a general process training. the power industry throughout his career, for how a project should be driven forward “We are responsible for tailored training. including various management positions NEIGHBOURS between the various decision points in the Those who want to learn more about project in Statnett. In deep water Stage-Gate model. The business areas have management and about projects as a form FOR THE PAST 15 YEARS, he has worked then established detailed versions of this. of work can sign up for various training in Norsk Hydro, where he was responsible programs. They range from courses on how for major projects, both in Norway and in- The number of offshore wind farms is increasing. They provide us with more CLEAR PROCESSES “The purpose of to work in a project to a Master’s degree in ternationally, within areas similar to those Stage-Gate is to create a uniform and clear project management,” Pål Otto Eide says. he is now responsible in Statkraft. clean energy, but what about life underwater? Is this development good for crabs and fish? As it turns out, research suggests it may.

Anette Hjerde Olivia Langhamer

t seems obvious that large, anchored offshore effects than negative. “We found a higher density Life at Lillgrund installations impact marine environments to some of the common crab around offshore wind turbines degree,” says Olivia Langhamer, post-doctoral than in similar marine areas without such develop- research fellow at the Norwegian University of ments,” says Langhamer. “And we noted a far greater Stage-Gate in practice THE LILLGRUND WIND IScience and Technology NTNU. “But we know very crab catch in the area in question after Lillgrund FARM is located in little about how.” entered operations than before the wind farm was In order to show how Stage-Gate PRE-FEASIBILITY A project team com- to complete the project. The market promoted for a final investment decision Øresund, on the border works in practice, Pål Otto Eide has prising internal and external resources framework is established, such as (DG3) by the executive management However, thanks to a partnership between Statkraft established.” However, she stresses that more long- between Denmark and drawn up an example of how an assess all relevant aspects of the pros- power sale agreements. Extensive geo- and the board. and NTNU, we now have a few answers. Langhamer has term data are needed before making any definitive Sweden. imaginary Statkraft project would pect. An appraisal report summaries their logical surveys are carried out in order looked at the impact the Lillgrund offshore wind farm conclusions. look. He has chosen an international findings, and makes a recommendation to reduce risk. The implementation and CONSTRUCTION An extensive and has on the marine ecosystem in the area. According to Langhamer, the increase in crab THE FARM comprises 48 hydropower project: based on identified risk and profitability. A contract strategy is established. Rec- complicated construction phase can now “I chose to focus on the impact of two species, population is because the installations function as wind turbines and is one DG1 decision is made to continue. ommendation for continuing is given in start. A major project team is mobilised the shore crab and a fish called viviparous eelpout,” artificial reefs. of the largest in Sweden. SCREENING Business Development an appraisal report for DG2. locally to manage the development. The Langhamer says. “Wind farm installations that are anchored to the Lillgrund is owned and identifies various prospects that each FEASIBILITY/PERMIT More detailed development is monitored closely by a Both species were in the area before work on Lill- seabed provide crab and other species with hiding operated by Vattenfall AS. represent a possible hydropower design studies and assessments are PRE-CONSTRUCTION/TENDER The dedicated owner organisation throughout development. A DG0 decision is made project is further mobilised, and the the construction phase, in parallel with grund started. They remained during the construction places,” she says. “Cavities and crevasses in the con- now carried out by a dedicated project A RESEARCH PROJECT for the most interesting prospect, in organisation. Usually, extensive impact detailed design is developed further. preparations for operations. The power phase and both are still present. “Both the shore crab structions help increase and improve living conditions has looked at the impact order to take a closer look at it through assessment studies will be carried out Tenders from suppliers are assessed plant is completed and can be trans- and the eelpout are common species in most coastal for the species we looked at. The eelpout we caught on marine life in the area. a pre-feasibility study. to secure all permits needed in order and contracts awarded. The project is ferred to the operations organisation. areas and shallow sea areas where there are wind around Lillgrund had fewer injuries and more and farms, or planned wind farm developments in Europe,” larger embryos than the fish we caught in the control THE RESEARCH PROJECT she says. “So it is important and relevant to identify the areas. And more of the embryos lived to adulthood.” IS HEADED by Olivia impact the offshore installations have on their lives.” Langhamer is careful in making broad general- Langhamer of the biology The research results do not tell a dark tale of mass isations – there could be local variations, and more READ MORE about the Stage-Gate department at the extinction. In fact, it is the opposite! If these subma- research is needed. Meanwhile, Danish-Swedish crab model on the intranet under “The Norwegian University of Statkraft Way”. rine creatures are affected by the new constructions in and eelpout seem to thrive alongside their artificial Science and Technology their neighbourhood, the results show more positive neighbours in Øresund. (NTNU).

30 STATKRAFT NO 4 2014 NO 4 2014 PEOPLE & POWER 31 IN BRIEF PEOPLE

PEOPLE

The new development unit Projects & Construction A growing number of businesses around HELGE-JÜRGEN BEIL now counts 155 staff, with 45 permanent em- VP Business Alliances in Inter- the world are implementing sustainability national Hydro (IH), has been plans, as more and more consumers ployees and 110 project-based personnel. The unit appointed the head of a project gathers the group’s development expertise, and to explore various market oppor- demand a more responsible approach tunities for the power production executes international hydropower developments output from Devoll, Albania. The from businesses they patronize. plant will enter production in the AL GORE, IN ROLLING STONE MAGAZINE, JULY 2014. THE 2007 NOBEL PEACE PRIZE LAUREATE 155 for Statkraft, SN Power, and Agua Imara. summer of 2016. WILL BE A GUEST DURING STATKRAFT’S ANNIVERSARY CONFERENCE IN JUNE 2015

Team Statkraft AS THE NEW YEAR’S ROCKETS BURST IN THE AIR, Statkraft enters an anniversary. It will then be AND ANIMALS STATKRAFT recently entered into a 120 years since the Norwegian government one-year agreement with Tarjei Bø, bought its first waterfall rights, the Paulenfos- former world champion and Olympic sen waterfalls in Vest-Agder County for NOK champion biathlete. He is the latest Back in 23 245. This purchase is considered the begin- addition to a very strong Statkraft 120 years of ning of what we know today as Statkraft. the groove quartet ahead of the upcoming season. “We will seize the opportunity to showcase In addition to Bø, Statkraft sponsors HAPPY SALMON HAVE BETTER Strengthening the team Tiril Eckhoff, Synnøve Solemdal, and Statkraft’s journey from a hydropower pioneer SEX LIVES, local Norwegian Tarjei Bø. power history to a leading renewables company,” says senior Emil Hegle Svendsen. The Norwegian paper Rana Blad reports. The Biathlon Association, the junior cup, vice president, corporate communication Bente background is the rehabilitation and the regional recruitment teams Engesland. The 120th anniversary will be marked of the Røssåga River in Hemnes make up Team Statkraft. with conferences in Sauda and London, as well Municipality, When the Nedre as events around the opening of the hydropower Røssåga power plant was plants Cheves in Peru and Kargi in Turkey. constructed after WWII, the environment was not a focus. In connection with Statkraft’s international With the construction of a new JUMP-START TO THEIR CAREERS management conference Pure Leadership, there power station and renovation of will be a grand event in the Oslo Opera House EIGHT YOUNG WOMEN AND MEN started their two-year trainee the old facility, Statkraft is programme in Statkraft in September. Each has a tailored programme in June. The event will feature leading person- carrying out several measures based on their education and Statkraft’s competence needs. This year’s alities from the energy industry and Statkraft, to mitigate negative environ- class of trainees comes from five different countries, and have degrees as well as an appearance by former U.S. Vice mental consequences from and backgrounds primarily in technology and economics. They all President Al Gore. In 2007, he was awarded the previous developments. During share a desire to work in the rapidly growing renewables industry. One Nobel Peace Prize together with the IPCC, for the 2017 spawning season, of the new trainees is German Laxman Pararasasingam, a chartered his efforts to raise awareness of human-induced salmon and sea trout ready to spawn will once more enjoy engineer in mechanical engineering from University College London. As climate change. a trainee, he will be working with wind power analyses. “If you want to good spawning areas in a “Our ambition is to become a leading work with wind power, Statkraft is the place to be,” he says. section of the river that has . international company within clean been overgrown for decades. energy,” says president and CEO Christian Rynning-Tønnesen. “With the current internationalisation of the company, we have a great opportunity to showcase our position and our ambitions, for both our employees and external stakeholders.” The fourth volume in the series on the electricity adventure that started with the Paulenfossen waterfalls, will be published for the 120th anniversary. The topic is Statkraft’s international journey.

32 STATKRAFT NO 4 2014 NO 4 2014 PEOPLE & POWER 33 IN BRIEF OUR PEOPLE

OUR PEOPLE

Statkraft has 3 735 ­employees, and there is always someone Claudia Gellert feels comfortable in both maritime changing jobs. and political environments. The relaxation and

ON THE MOVE CLAUDIA GELLERT silence when she is diving balances the busy workdays promoting Statkraft’s interests in

Position: Manager Public Affairs German energy politics. We asked her about ... Department: : MTCA – Market Operations & IT Trading & Origination Continental Public Affairs Statkraft’s activities in Germany are increasingly impacted by politi- Country: Germany ... work. cal decisions. My job is to identify political issues that will affect our field, and to In Statkraft since: January 2013 communicate Statkraft’s proposals for solutions to the politicians. I organise the Name: Horst Kesselmeier Age: 37 years dialogue between Statkraft and political bodies, and also work to position us as a Position: VP Projects South America, Education: Plays a key role in voicing credible partner. The goal is for legislation to provide the best possible framework International Hydro Statkrafts interest, knowledge and for Statkraft’s activities. Country: From Germany to Brazil advisory capacities towards politics in Years in Statkraft: 6 the continuing process of reforming renewable law and energy market ... inspiration. I am inspired by seeing how the right argumentation can From Europe to South America: Over design in Germany. contribute to improving political decisions. In order to make good decisions, you the past six years, Horst Kesselmeier need plenty of effort and insight. Politicians need companies like Statkraft to has worked with project development in better understand future developments in the energy market. the T&O unit, and headed construction projects in Germany, France and the ... downsides. Downsides are just a part of life, together with upsides. As UK. He recently moved to Florianopolis, a young law student I had a rude awakening when I realised that no policy is Brazil, to head regional hydropower unaffected of stakeholder interests. Studying law gave me insight into how legis- development and construction projects lation is made, but in reality there are always additional factors at play, such as in Brazil, Peru and Chile. the interests of the players in the field in question. I now see this as a chance to influence political decisions in the right direction.

... upsides. Statkraft is establishing itself as an important and respected player in Germany. Statkraft is now being invited to political consultations, and we are asked to develop future integration of renewable energy in the market. This is major progress, and I am proud to be a part of it.

... balance. I strive to find the perfect balance in everything I do – pro- fessionally and politically, as well as personally. I enjoy travelling, skiing, and Name: Børge Nilssen Stafne perhaps most of all, free diving all over the world. To be completely immersed Position: Program Manager Future by the sea and experiencing the spectacular marine life below the surface is as Hydropower close as I get to the perfect balance. Country: Norway Years in Statkraft: 4 ... pure energy. I think Statkraft is the perfect company to offer and support the market integration of renewable energy. With our virtual power plant we can Børge Nilssen Stafne has been a project offer flexible capacity from renewable sources based on demand. Furthermore, manager and worked on technical support by delivering flexibility in power production and back-up services to Germany for the power plants in Central Norway Statkraft can create a win-win situation for both the German “Energiewende” (PGMTT) since 2010. As head of the and the Nordic power system. hydropower programme in the innovation department, he commutes between Oslo and Trondheim. The programme will further develop sustainable and environmentally Inge Kvivik Morten Brun friendly solutions for existing and new hydropower plants.

34 STATKRAFT NO 4 2014 NO 4 2014 PEOPLE & POWER 35 CURRENT AFFAIRS POWERTALK

POWERTALK The Market Advocate

“The power market has never been more volatile,” says Mikael Lundin, CEO of Nord Pool Spot, without any room for misinterpretation. As the top executive of Europe’s leading power exchange, he knows what he is talking about.

Knut Fjerdingstad Tommy Andresen

MIKAEL LUNDIN ikael Lundin sits at the helm of than now. It is very difficult to say anything a Nord Pool Spot that has been about the future.” growing since its inception in What makes it so uncertain? Norway and the Nordic countries “When the Nordic markets were dereg- AGE: 48 years Min the early 1990s. These days, the Nord Pool ulated in the 1990s, the politicians loosened POSITION: CEO, Nord Pool Spot CEO divides his time with Europe as well. their grip. Eventually, Europe did the same. EXPERIENCE: 20 years “A typical working day usually starts at The markets contributed to moving the executive experience in an airport around six in the morning. Over industry forward and improving profita- Spokesman Knut the power sector the course of a week, I’ll travel to Germany, bility. But now we are seeing a complete Fjerdingstad talks with EDUCATION: Stockholm Poland, Lithuania and Brussels, before change with more regulation.” power exchange CEO School of Economics landing in Stockholm Friday evening,” he So it has become more difficult to predict what Mikal Lundin on the FAMILY: Wife and daughter development in European says. will influence the market in terms of regulation power markets. and directives? GLOSSARY: Market Coupling: Term MARKET INTEGRATION The weekend is “Yes, exactly. We don’t know the direc- used for the connection reserved for family time, and he is careful tion. Will we see even more regulations, of power exchanges and to protect it. If he thinks about work, it is to or will we continue to have a free market? system operators in take joy in the success of the market inte- Then we have the green development, with northwestern Europe. gration in Europe. Nord Pool Spot has played government subsidies of renewables that EU ETS: Emission Trading a key role in the efforts to connect markets also increases this uncertainty. System, the EU’s most in Europe, a process called market coupling. important measure to “We have worked intensely together LET THE MARKETS WORK It is early curb carbon emissions. with other major exchanges and system November, and 13 degrees C outside the Kodak moment: A operators. The objective has been to ensure power exchange at Lysaker in Oslo, Norway. sentimental or charming more efficient use of all electricity, and This autumn has been one of the mildest on moment worthy of captur- to increase liquidity when trade between record and very wet. However, Mikael Lun- ing in a photograph. (The various markets increases. din is not confident that the politicians will expression was originally be able to find the most efficient solutions used to promote Kodak.) A COMPLETE CHANGE For 20 years in to the climate challenge. He believes the In business, its refers to a company that has not – the industry, Lundin has seen the develop- markets would be far better suited. like Kodak – kept up with ment move from a market-happy deregu- “We had an opportunity to let the mar- modern developments. lation to increased regulations of markets ket reign. The politicians could have kicked in recent years. off the ETS system once more, but instead Smart grid: Smart elec- tricity, a technology that How would you describe the market situation chose to do the exact opposite. I would go enables consumers and in the Nordic region and Europe? as far as saying that the EU has failed in the entire power grid to “After many years in the industry, I must terms of climate policy. Had the climate manage consumption. say that it has never been more uncertain policy been based on market forces, it

36 STATKRAFT NO 4 2014 NO 4 2014 PEOPLE & POWER 37 CURRENT AFFAIRS POWERTALK

STATKRAFT NATION TURKEY POWERTALK I would go as far as saying that the EU has failed in terms of climate policy. Had the climate policy been based on market forces, it would have also provided TURKEY Europe with a competitive advantage.

MIKAEL LUNDIN, CEO, NORD POOL SPOT INHABITANTS: About 75 million 1355KILOMETRES CAPITAL: Ankara GOVERNMENT: Democratic republic PRESIDENT: Recep Tayyip Erdogan LANGUAGE: Turkish ... is the length of Turkey’s longest river, the Kızılırmak River. On this river, in the Corum would have also provided Europe with a “In Nord Pool Spot we love interconnec- How do all the small-scale producers on the ­province in northern Turkey, Statkraft is developing the Kargi hydropower plant, scheduled for THE ENERGY MARKET competitive advantage.” tors – markets that are connected to liquid, continent impact the market? completion during the first half of 2015. What can the market do that the politicians transparent and major trading volumes.” “Currently, the development is very can’t? And the consumer has to pay more for elec- much driven by subsidies. In order for this Turkey’s energy market is the fastest to work properly, they also need to take “The market’s advantage is an efficient tricity? growing in Europe, with an estimated allocation. There is no more efficient way “In some countries this is a touchy sub- their share of the balancing obligations. annual growth of six per cent leading than to have the market’s invisible hand ject, where there is concern for electricity Security of supply still rests with the sys- up to 2020. It is expected that demand govern it.” prices and the industry. But the Baltic states tem operators and the major companies.” for energy will almost double from 211 What makes the ETS system so good? want as many interconnectors as possible.” Statkraft has had success on the continent by TWh in 2010 to 400 TWh in 2020, due “It is a genius system, but you need to The Nordic power industry wants interconnec- offering market access to small-scale producers? 1 to increased consumption per capita and population growth. Turkey has made have the calm to remain in it. If you let it tors to avoid ending up with a major power surplus “Yes, that is a good example of how good progress in deregulating the power deteriorate, it will not work.” and collapsing prices. What is your view? synergies for the growth in renewables are 4 5 market. All regional power distributors What do you mean by that? “That’s the big question. I don’t really realised. This is what I mean when I say have been privatised, the private share of “I mean that certain countries have var- have a good answer to that.” that the major companies can regain some power generation is steadily increasing, ious support schemes for renewable energy. of the command they have lost.” and more that 100 private companies are Each country does what suits them best. REALISING SYNERGIES European utility 2 active in power trading. In Germany, they are discussing phasing companies are struggling. Some acknowledge UNCERTAIN, BUT EXCITING Nord Pool out coal, while Poland is modernising and that the green development has slipped. Is this a Spot has had major success. Will it continue? 3 developing new coal power plants.” “Kodak moment” for the power sector? “I’m very optimistic on behalf of Nord DID YOU KNOW ... Lundin believes that the basis for a good “No, not quite. Things are not moving Pool Spot. Trading is moving towards climate policy is a coordinated effort, and as fast, and there are scenarios where shorter time horizons, and the need for that the climate challenge is a global issue the major companies bounce back. a well-defined reference price has never TURKEY has 13 entries on UNESCO’s that needs a great degree of coordination. However, many have been stuck with the been greater. The entire smart grid technol- POWER PLANTS STATKRAFT OFFICES world heritage list. old technology for too long. This is what ogy is driven by a well-defined spot price.” LOVES INTERCONNECTORS Despite all characterises most of the companies. In You have talked about the uncertainty in the LEONARDO DA VINCI planned a the challenges, the Nord Pool boss also sees this regard, Statkraft stands out and has a market. How about job opportunities? 1 KARGI, UNDER CONSTRUCTION 4 ANKARA bridge across the Bosporus, but it reason for optimism. unique position.” “The number of full-time equivalents 2 CETIN, UNDER CONSTRUCTION 5 ISTANBUL was never built. 3 CAKIT, OPERATIONAL might decrease, but the content of the jobs ISTANBUL’S METRO, the Tünel, increases. This uncertainty will lead to is the second oldest in the world. even more exciting tasks.” Service started in 1875. My day: I usually start my day around 0430 hours, most often at a 1–3 Lundin glances at his watch. The day’s ENERGY hotel. At around 0600–0700 I am on a plane, working on my computer “magic moment” is drawing near. This is WOLVES, brown bears and foxes are on my way to somewhere in the Nordic region, the Baltics, continental among the mammals found there. Europe or the UK. Then I have meeting until 2000–2100 hours. when the invisible, yet efficient, hand of the market will do its thing. Throughout MORE THAN 400 000 Norwegian Energy the morning, the various players report tourists visit Turkey each year. 10 their production plans, power demand, STATKRAFT IN TURKEY MUSTAFA KEMAL ATATÜRK and relevant transmission capacity. At 8 (1881–1938) founded the modern 12:42 sharp, the prices are made public in Turkish state in 1922, with focus on 6 the market. Turkey is a key market for Statkraft in terms of hydropower generation and power trading. Statkraft’s modernising the country. Republic 4 “For a time I worked with stock port- largest hydropower development in the country, Cetin, is heavily delayed. In November, Statkraft’s Day is celebrated 29 October each folio management. The nice thing about board of directors decided to continue the project with a new schedule, new cost frame and new main year in commemoration of this. 2 power trading is that it is combined with contractor. When Cetin is completed, Statkraft will have invested more than NOK 7 billion in Turkey. The day a product that is important for society. Statkraft’s Turkish venture is managed from the offices in Istanbul and the capital Ankara. Both the employees and I are very proud of this.”

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