Investor Presentation June 2020 1 Investor Presentation March 2020 2

Investor Presentation June 2020 1 Investor presentation March 2020 2

Disclaimer

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1 The most important infrastructure. Of all.

2 Green investments

3 Business Risk: Excellent

4 Low finance risk The most important infrastructure. Of all. 4

THE MOST IMPORTANT INFRASTRUCTURE. OF ALL.

Government (AAA) ownership and backing. Fully regulated. The most important infrastructure. Of all. 5

Critical infrastructure in one of the world's richest countries

Statnett is the TSO in the Kingdom of Norway (Aaa/AAA/AAA)

• "Pure play" transmission • CICERO: Dark green shading • No volume or commodity risk • State Enterprise – by law, only the government can be the owner • Fully regulated • Low volatility in underlying earnings • Stable regulatory regime, one of the longest track records in Europe • The board committed to a "robust A rating" • Issuer rating A2/A+ by Moody’s and S&P, respectively • COVID-19 – measures in place - very limited consequences for operations, investments and financials. • Temporary reduction in tariffs in 2021 to be made up, underlying revenue unchanged The most important infrastructure. Of all. 6

Main figures 2019

Facts Grid size (km high voltage power lines) 11,000 Subsea and land cables (km) 1,600 Substations (No.) 170 Empoyees (No.) 1,490

Financials (NOK billion) Balance sheet 76.3 Revenues (adj) 10.4 EBITDA (adj) 6.2 Profit after tax (adj) 2.5 The most important infrastructure. Of all. 7

Governance reflects the strategic role Ministry of Petroleum and Energy

The Board

Regulator

RME NVE

Customers The most important infrastructure. Of all. 8

One defined mission

“To develop the next generation power system in Norway Security of supply by 2030"

MISSION

Value Climate creation The most important infrastructure. Of all. 9 Statnett – Green, social and responsible. Supporting 8 key UN Sustainable Development Goals - English picture

The most important infrastructure. Of all. 10

Sustainable highlights 2019

Environment • Construction work without fossil fuel • Climate: Procurement selection criteria • GHG reduction by 4 % • Initiatives on biodiversity

Social • Decreased injury rate by contractors • 80 % covered by collective bargaining agreements • Signed agreement with the Norwegian Tax Authorities

Governance • Established ESG Committee • Appointed dedicated ESG coordinator The most important infrastructure. Of all. 11

Low emission construction site

• Constructing the Smestad-Sogn cable tunnel for the electric future of Oslo

• Total site emissions reduced by 78% • Electric tunnel machinery

• Electric light duty vehicles

• Trucks and heavy machinery: Renewable diesel without palm oil

• Statnett targets to cut own emissions by 25% compared to 2020 before 2025

Photo: Mimsy Møller, Dagsavisen The most important infrastructure. Of all. 12

We combat labour crime

• Formalized collaboration on labour crime with tax authorities from Nov. 2019 • Statnett's guidelines prerequisite for suppliers • Must comply on HSE, environment and quality standards • Acceptance for info sharing with tax authorities • On-site control of salary and working conditions for workers • Maximum two layers of sub-suppliers allowed • Zero injuries vision. Injury frequency halved since 2014.

Statnett and Norway's tax authorities join forces to combat labour crime The most important infrastructure. Of all. 13

Governance – Transparency, dialogue and acceptance

• ESG Committee established in 2019 • Dedicated ESG position • The Board of Directors overarching responsibility for CSR • Top management responsible for measures and reaching goals • Policy on CSR part of Statnett's management system • Zero tolerance on corruption, harassment and labour crime • Dedicated Ethics Representative managing whistleblower programme

CEO Auke Lont Green investments 14

GREEN INVESTMENTS Green investments 15

Green projects in Statnett

• Contribute to national climate goals • Ambition: Leading company in climate and environmental activities • Minimized impact on biodiversity, landscape and communities

• Green projects exceed NOK 20 billion • Connecting renewable power production • Enabling efficient use of clean energy • Increasing the market for renewable energy

• Currently financing: "Smestad – Sogn" and "North Sea Link" Green investments 16

Smestad – Sogn: Supporting The Green Capital of Norway

• Renew Smestad substation and build new cable interconnector between Smestad and Sogn • Expected cost 1,250 – 1,390 NOK million • Oslo is the European Green Capital 2019 • 30 % new cars sold being electric vehicles • Targets to cut emissions by 50 % by 2020 and 95 % by 2030 • The project is a part of The Greater Oslo Grid Plan ensuring a reliable supply of electricity to Oslo and Akershus Green investments 17

Connecting the European power market

• Norwegian electricity production is generated by 98% renewable energy, of which 97% is hydro power • The power surplus in Norway generates clean electricity export to both UK and Germany when prices are high - reducing the initiation of higher marginal cost electricity abroad, typically fossil fuels • When wind blows and the sun shines there is an excess of renewable energy in UK (wind) and Germany (wind/solar) which Norway then imports and can conserve water in many of the reservoirs

North Sea Link Capacity app. 1,400 MW NordLink Est. compl. 2021 Capacity app. 1,400 MW RAB in 2019 with trial and commercial operation in 2020/2021 Green investments 18

Green investments all over the country

New industry and security of supply – North Norway

Necessary replacements of stations and lines

Energy intensive industry, electrification offshore

Connection of data centers in all parts of the country Connection of wind-power along the coast – Fosen and Bjerkreim

Capacity projects on the west coast

Security of supply in major cities - Oslo, Bergen and Stavanger

Interconnectors to Germany and the UK sentence

Green investments 19

CICERO Second Opinion: Dark Green

Strengths

• "Overall, Statnett’s green bond framework provides a progressive, clear and sound framework for investments into projects that well align with the Green Bond Principles" • "The overall assessment of the governance structure of Statnett gives it a rating of Excellent" • "Statnett has updated its climate and environment strategy and defined ways for how to reduce emissions"

Weaknesses

• “There are no apparent weaknesses in the framework” Green investments 20

Bringing Statnett´s investments to a new level

14 • Investments will stay at a high level until both interconnectors are completed in

12 2021. After 2021, investment levels are expected to be more moderate

Contractual obligations (exceeding NOK 8 • 50 million) amounted to NOK 6.6 billion as of 31 December 2019.

BillionNOK 6

0 Green investments 21

Significant investments successfully completed

Consistent and Execution significant on track savings

Numerous major projects completed within the last 10 years "Business risk: Excellent" - S&P 22

“BUSINESS RISK: EXCELLENT”

______S&P, Research Update, February 2020 "Business risk: Excellent" - S&P 23

Excellent business risk confirmed by both Moody’s and S&P

Moody’s Credit Opinion, May 2019 S&P Global Ratings, 14 March 2019

“Stable and predictable cash flows generated “Efficient grid and transmission system” under one of the most well-established and transparent regulatory frameworks in Europe” "Business risk: Excellent" - S&P 24

Cost based revenue with a regulated rate of return

• "Pure play" transmission - fully regulated • No power price or volume exposure • Allowed revenue – cost based - 100% when efficient • Operating costs (with 2 year time lag, plus inflation, some costs are back-to-back same year). Depreciation is cash compensated same year • RAB (as of 31 Dec each year), regulated return (WACC, 5.69% in 2019). • Allowed Revenue annually adjusted to fit updated costs and rates – no regulatory period end point • No "x-factor" (no general across industry efficiency improvement requirement) • Allowed revenue distributed between customers through tariffs • Differences to allowed revenues made up in subsequent years • No significant counterparty risk - limited credit allowed and any losses would be picked up by all customers (included in allowed revenues) "Business risk: Excellent" - S&P 25

Stable earnings, driven by growing Regulated Asset Base (RAB)

8 000

7 000

6 000

5 000

4 000

3 000 Million Million NOK

2 000

1 000

0 2007 2008 2009 2010 2011 2012 2013 2014 2015 2016 2017 2018 2019 RAB (index) EBITDA excl. higher/lower revenues EBITDA (IFRS) Low finance risk 26

LOW FINANCE RISK Low finance risk 27

Prudent financial policies and low financial risk

Sufficient liquidity… • … to fund operations, investments and redemptions over a minimum 12 months period • NOK 8.0 billion committed RCF (undrawn, matures Jan 2024) • Normalised cash position: Approx. NOK 2.3 billion

Low counterparty risk • Minimum rating requirement of A- • Credit Support Annex (CSA)

Low interest rate risk • Regulated rate of return 5.69% in 2019 • Seek to correlate rate on debt with NVE-interest rate (regulated return) Low finance risk 28

Multiple sources of capital as of 31.12.2019: Total NOK 40.6 billion

Domestic CP 3,0

Domestic Bonds Drawn Bank 10,2 Loans EIB & NIB 7,8

CHF 0,9 SEK 1,6 Issues in EUR 10,0 Issues in USD 7,2 Low finance risk 29

Low refinancing risk as of 31.12.2019

10 000 Commercial Paper 9 000 Bank Loans Domestic Bonds 8 000 International Bonds 7 000 Average time to 6 000 maturity:

7.1 years 5 000 MNOK

4 000

3 000

2 000

1 000

0 Low finance risk 30

Long term funding

Access to capital markets supported by • Undrawn Credit Facility NOK 8.0 billion • Strong and supportive bank group • Robust A rating policy

Rating Agency Short-term Rating Long-term Rating Outlook Moody´s P-1 A2 Stable S&P Global A-1 A+ Stable

The owner of Statnett SF (The Kingdom of Norway), is rated Aaa/AAA/AAA by Moody´s, S&P and Fitch, respectively

Latest credit opinion report on Statnett SF from S&P Global: 26 Feb 2020, from Moody's: 24 April 2020 Summary 31

SUMMARY Summary 32

1 The most important infrastructure. Of all.

2 Green investments

3 Business Risk: Excellent

4 Low finance risk Summary 33

Key investment highlights

Statnett is the TSO in the Kingdom of Norway (Aaa/AAA/AAA)

See appendix for details on revenue regulation model Appendix 34

APPENDIX Appendix 35

Climate – Ambitious strategy

• Industry leadership on environment and climate efforts. • Support national climate goals - facilitate electrification and renewable energy.

Operative targets

Integrated & documented

Procurement

Incentives & choices Appendix 36

Norway – hydro reservoirs supporting a greener Europe

• Norwegian power production dominated by hydro (96%) • Power surplus – clean energy export • Reservoir flexibility supports European renewables

Week 2 2019: Wind power production and power exchange

I Appendix 37

Key investments

Project Region Expected investment (MNOK)

Commissioned projects Namsos - Åfjord and Snilldal - Surna, new 420 kV power line Central Bjerkreim, new transformer substation South Elhub

Under construction Western Corridor, voltage upgrade South 6,600 - 6,800 Balsfjord – Skaidi, new 420 kV power line North 4,000 - 4,500 Lyse - Fagrafjell, new line and substation South 2,020 - 2,095 Smestad – Sogn substation and cable installation East 1,250 - 1,390

Interconnectors, under construction Cable to UK (North Sea Link) 1) MEUR 750 - 1,000 Cable to Germany (NordLink) 1) MEUR 750 - 1,000

1) Statnett’s share. Exposure mainly in EUR, in range of NOK 7–9 billion per project Agreements with partners in Germany and UK are denominated in EUR. Appendix 38

Reconciliation of financial key figures (in million NOK)

Unadjusted figures 2010 2011 2012 2013 2014 2015 2016 2017 2018 2019 Revenue 7,247 5,497 5,334 4,561 5,563 5,906 6,678 7,401 9,138 9,641 EBITDA 3,945 2,426 2,260 1,394 2,528 3,340 3,296 3,715 5,100 5,432 EBIT 3,279 1,628 1,433 346 1,378 1,714 1,152 1,312 3,120 3,027 Profit after tax 2,198 1,000 837 82 829 1,103 645 813 2,213 1,906

Adjustments Accumulated higher revenue* 1,553 2,617 3,455 2,413 1,790 1,346 343 -303 59 -732 Adjustment for changes in acc. higher/lower revenue -2,186 -1,064 -838 1,042 623 444 1,003 646 -362 791

Adjusted figures Adjusted revenue 5,061 4,433 4,496 5,603 6,186 6,350 7,681 8,047 8,776 10,432 EBITDA 1,759 1,362 1,422 2,436 3,151 3,784 4,299 4,361 4,738 6,223 EBIT 1,093 564 595 1,388 2,001 2,158 2,155 1,958 2,758 3,818 Profit after tax 624 234 234 832 1,284 1,427 1,397 1,304 1,934 2,523

*See note 4 in Annual Report for changes in accumulated higher/lower revenue. Appendix 39

Predictable revenues and profitability dynamically adapted to costs

1 Revenues: Costs1 x 40%2 + Costs1 x 60%2 x Efficiency Score

Efficiency score: 100% Timely compensation Successful benchmark with other No time lag on investments, system service European TSOs. Efficiency costs or depreciation, two years lag on operational costs programme initiatives (compensated with inflation)

2 Regulated rate of return (2019: 5.69%) 1.5% + Inflation + 0.875 x 5% x 40%3 + (5y swap rate + margin) x 60%3 (1-Tax rate)

1) See separate slide for definition of costs 2) From 2023: 40% and 60% will change to 30% and 70% respectively 3) 40% equity share regulatory assumption – fixed parameter independent of company Appendix 40

Calculation of allowed revenue

1 1 Revenue Cap = 40% * Cost Base + 60% * Norm Cost + TLn-2 * Pn + CENS + Sn-2 + TrC + Ptax

Transportation Loss in grid in Cost of Cost of Transit Property year n-2, times updated power Energy system costs tax (back- market price in year n (which not services (back- to-back) takes away practically all price delivered to-back) risk for Statnett) times 60%1

Norm Cost = Cost Base * Efficiency score

CPIn Cost Base = O&Mn-2 * + Dn + 1.01*RABn * NVEraten CPIn-2

Inflation adjusted operating Depreciation in Rate of return on Regulatory and mainenance costs year n Asset Base in year n

Note that the regulator calculated Dn and RABn*NVEraten in two steps, first with two year's timelag on Dn-2 and RABn-2, 1) From 2023: 40% and 60% will change then adding the increase in basis from n-2 to n. Total effect as described above. to 30% and 70% respectively Appendix 41

Organizational structure Auke Lont President and CEO

Lont holds a Master's degree in econometrics from Vrije University in Amsterdam. He became President and CEO of Statnett in February 2009 after having held the position of CEO with the consulting company Econ in Norway. Lont has previously held top executive positions in Statoil, has worked in South Africa and was the CEO of Naturkraft AS. He has more than 30 years’ experience from the energy sector. Auke Lont is a member of the board of the employers' association Spekter and the railway infrastructure company Bane NOR

Knut Hundhammer CFO and Executive Vice President

Hundhammer was educated at the Norwegian Military Academy and has an MBA from Wharton School of Business in the US. He joined Statnett in May 2011, and is responsible for the Group's economy, finances, HR, HSE, legal affairs, risk management and quality. He has previously been Deputy Managing Director/CFO of Finansbanken ASA and CFO/COO of Høegh Autoliners. He has also been president of the commercial shipping division in the Klaveness Group, and a consultant for McKinsey & Co. Appendix 42

Connecting the European Power Market

NordLink North Sea Link (NSL) • Interconnector between Norway and Germany • Interconnector between Norway and the UK • The last few years have seen a significant increase in wind power and • The interconnector will link the Nordic and UK markets, providing solar power in Germany. When the winds blow and the sun shines this benefits on both sides creates a surplus of renewable energy in Germany, which also leads to • When the winds blow in the UK and wind power production is lower prices than in Norway. Norway can then import this power and high, Norway will be able to import power from the British to a conserve the water in Norway's many hydropower reservoirs. lower price than in the Norwegian market and conserve the • When there is little production of wind power and solar power in water in Norway's many hydropower reservoirs. Germany the need for power increases and the prices will be higher • When there is little wind and a greater need for power in the UK, than in Norway. Norway can then produce hydropower and export it to the situation will be the other way around. The UK can then Germany. This way we get more out of the resources on both sides of import Norwegian hydropower at a lower price than in the the cable. British market and through this secure the power supply.

• The advantages of this exchange of green energy include: • Increased security of supply because one can import more electricity at a lower price when the power situation is tight • Increased market for power producers when there is a surplus of power in the national markets • Facilitation of higher production and consumption of renewable energy in Norway, the UK and Germany, thereby contributing to future climate-friendly energy • More predictable supply situation and price throughout the year and from year to year • Both projects are organized as "unincorporated joint ventures". Statnett holds 50%. Statnett's part in NordLink is organized in a wholly owned subsidiary, but fully financed by the parent company. Costs and trade revenues are shared equally. Counterparts are National Grid for the NSL and TenneT and KfW owns the southern part of NordLink through a jointly owned German company. • Statnett's parts are fully regulated, revenues are cost based, same as for onshore grid. So the trade revenue risk rests with the customers. Appendix 43

Tariff

• Set by Statnett ahead of each year. • Tariff is split between a variable part and a fixed • Defines how Statnett distributes the allowed part. revenue between different customer groups. • The variable part (approximately 20%) is based on • The tariff does not define the long term marginal transmission loss in each node and billed revenue: weekly • Any difference between collected tariffs • The fixed part is designed to cover the remaining and the allowed revenue is made up in part of the allowed revenues. It is allocated subsequent years according to customer groups, load/production and • End result: Over time, Statnett ends up point of connection, and paid mid-month for the with the cost based regulated allowed same month revenue cap. Appendix 44

Financial information and contact info

Available http://www.statnett.no/en/investor-relations/ at:

Contact details: Knut Hundhammer (Executive Vice President CFO Corporate and Public Relations) Tel. +47 23 90 32 10 [email protected]

Petter Erevik (SVP, Director of Finance) Tel. +47 23 90 35 70 [email protected]

Marte Bakken (Senior Advisor, ESG) Tel. +47 23 90 30 05 [email protected]