Statkraft Annual Report 2003

Statkraft is Norway’s largest producer of electrical focus Statkraft Annual Report 2003 power, the Nordic region’s third largest electricity focus focus producer and Europe’s second largest producer of Statkraft Annual Report 2003 Statkraft Annual Report 2003 electricity based on renewable energy sources Head office Statkraft Markets BV Consulting and design: Geelmuyden.Kiese. Photo: Stein Henningsen, John Petter Reinertsen, Aslak Øverås, Image Bank, Getty Statkraft SF Prof. J.H. Bavincklaan 13 PO Box 200 Lilleaker NL-1183 AT Amstelveen NO-0216 Oslo, Norway The Netherlands In the course of 24 hours Statkraft produces Tel.: +47 24 06 70 00 Tel.: +31 20 347 2780 Fax: +47 24 06 70 01 Fax: +31 20 347 2799 100 million kilowatt hours (kWh). This corre- Internet: www.statkraft.com sponds to the average power consumption Street address: Lilleakerveien 6 Statkraft Markets GmbH Niederkasseler Lohweg 18 of almost two million households. Statkraft’s Region Northern Norway DE-40547 Düsseldorf vision is to be Europe’s leading producer of PO Box 163 Germany NO-8512 Narvik, Norway Tel.: +49 211 60 244 000 environmentally friendly energy. Our core values Tel.: +47 76 96 40 00 Fax: +49 211 60 244 199 are based on ADDING LASTING VALUE. Fax: +47 76 96 40 01 Street address: Stasjonsveien 60 Statkraft Financial Energy AB Hitechbuilding 92 Region Central Norway Sveavägen 9 Gaupnegrandane SE-101 52 Stockholm Focus on increased competitiveness 4 NO-6868 Gaupne, Norway Sweden Tel.: +47 57 68 92 00 Tel.: +47 24 06 70 00 Vision and core values 8 Fax: +47 57 68 92 01 Fax: +47 24 06 77 30 Current operations 9 Region Western Norway Statkraft in 2003 10 PO Box 233 Market conditions 14 NO-4201 Sauda, Norway Tel.: +47 52 78 64 00 Business areas 22 Fax: +47 52 78 64 01 Focus on finance 34 Region Eastern Norway Focus on the environment 40 s. Prod.: Jonny Fladby. Print: RK Grafisk A.S. s. Prod.: Jonny Fladby. PO Box 4 Focus on society 42 NO-3880 Dalen, Norway Tel.: +47 35 07 95 00 Focus on competence and corporate culture 45 Fax: +47 35 07 72 27 Strategic business management 50 Presentation of the group management 58 Presentation of the board of directors 62 Annual report from the board of directors 64 Accounts 73 Accounting principles 76 Notes to the accounts 80 Audtior’s report 101 Reference is also made to Statkraft’s Sustainability Report 2003. Competence Finance Environment Society and corporate culture Ord og utrykk mangler Focus President and CEO on increased competitiveness As Statkraft entered 2003, we had The year 2003 marked the transition to a Strengthening our regional companies will of the decision-making in Norway. Further gy is based on the demand for an just laid behind us seven years of period of consolidation and honing of focus therefore be a prerequisite for a success- expansion will be mainly beyond the adequate return over time and a continu- for the company. These efforts will contin- ful integration policy and realisation of borders of Norway in the years to come. ing contribution to society. Our goals are major expansion. During this ue in 2004 in several areas. In Norway we coordination gains. founded on the needs for ever more effi- period, the company made will continue our efforts to dispose of In 2004 the company expects clarification cient creation of added value and ever more significant acquisitions in Norway assets in accordance with the order from In the rest of Europe we will be looking for of whether or not it will be converted to a environmentally friendly power production. and also acquired a major interest the Competition Authority. We will also opportunities to develop production of limited liability company, as proposed by in the Swedish company Sydkraft. continue to invest at the same time. power from renewable energy sources. We the Government in Report no. 22 (2001– will also intensify our trading activities, 2002) to the Storting on government We had at the same time Our programme in Norway consists of and we will consider the acquisition of flex- ownership. Statkraft’s board of directors developed our expertise in trading three main elements. Firstly, we will focus ible power production that can support our has given its approval to such a conversi- Bård Mikkelsen and market operations, and on increasing the production and efficien- market operations. This means that we will on. The board of directors’ main reason for President and CEO established ourselves as an cy of our own production plants. The continuously evaluate possible positions this is the fact that companies that opera- upgrading and expansion of existing with regard to gas power on the Continent. te in a competitive arena as Statkraft does important player in Europe in this hydropower plants and the construction of Statkraft is already the second largest are generally not well served by being arena as well. new wind-driven power plants will be part provider of environmentally friendly ener- organised as a state-owned enterprise. of this strategy. Secondly, we will seek to gy in Europe, so it is natural for us to in- This form of business organisation is not increase the profitability of distribution and crease our European presence in terms of known internationally, and there is a great end-user sales together with our alliance hydropower, wind power and gas power risk that it will be regarded primarily as an partners. Thirdly, we will seek to promote production, especially in light of the de- enterprise with sectoral policy functions commercial coordination with the compa- regulation of the electricity markets in the and financial goals that differ from other nies in our group in order to generate great- EU. The demand for renewable energy is players. In order to operate efficiently, both er added value. It may be desirable to expected to increase. operationally and strategically, we are increase our ownership interests in com- dependent on the world around us per- panies where we already have stakes as Statkraft is a major contributor to Nor- ceiving Statkraft as an ordinary market part of this strategy. wegian society through the payment of player. Moreover, most of the power com- taxes and fees, and our mission is to obtain panies in Norway are also limited liability The operations in Norway will thus still an adequate return for our owner. In a companies. represent the core of our operations in the situation where we cannot grow on a large future. Therefore it is important to develop scale in Norway, it is necessary that we Regardless of the form of business orga- our roles as an owner and industrial devel- make the most of our opportunities in the nisation, the owner’s dividend policy and oper, since we envision opportunities for Nordic region and on the Continent. Our the company’s equity situation are of deci- further advances throughout the entire goal is to become a major player in the sive importance to Statkraft’s ability to value chain. Power production and distri- European market for environmentally reach the company’s strategic goals in a bution have of course local roots. friendly energy, with a head office and most very capital-intensive industry. Our strate- 4 5 Dagens virksomhet Dagens virksomhet “What is electricity?” We get asked a lot of good questions about electricity production. GOOD QUESTIONS demand good answers. 7 Narvik Power Dictribution Employees production Electricity grid (Man-years) TWh customers customers Statkraft SF 820 34 50 0 TEV 100 % Current operations Statkraft Group 1 970 42 75 000 260 000 Statkraft, TEV, Skagerak Energi, Baltic Cable Statkraft Alliance* 4 000 56 535 000 590 000 Statkraft,TEV, Skagerak Energi, BKK, Vision Gaupne Agder Energi, Fjordkraft, Baltic Cable Other stakes: 50.0 % SN Power 44.6 % Sydkraft BKK 49.9 % and core values Statkraft Alliance Stockholm 33.3 % Naturkraft 21.4 % Scanenergi Sauda Dalen 49.0 % HEAS** 20.0 % E-CO Vannkraft** Regional office Statkraft SF Figures for wholly owned companies Trading office * Skagerak Energi 66.6 % ** Order to sell from the Competition Authority Other ownership interests Agder Energi 45.5 % Sydkraft 44.6 % Scanenergi 21.4 % Business concept power in Norway, as well as the establish- Statkraft is Norway’s largest producer of Düsseldorf and Stockholm, and it owns Baltic Cable Statkraft’s vision is to become the 66.7 % Statkraft’s business concept is to create ment of efficient ICT solutions and net- electricity. The group has an average annu- two-thirds of Baltic Cable, which is the leading European provider of value for our owner, customers and soci- works. al production capacity of approximately 42 power transmission cable between environmentally friendly energy. ety at large by: TWh, which represents around one-third Sweden and Germany. Our vision will guide the develop- • Developing and producing environmen- From strategy to action of Norway’s production of hydropower. ment of Statkraft, and thus tally friendly energy in Europe and other Statkraft shall be developed according to Statkraft is currently the third largest power Statkraft owns power plants in Nepal and Amsterdam selected regions the following guidelines. In the coming producer in the Nordic region and Europe’s Laos. There are plans to transfer these Düsseldorf influence the company’s future • Trading in energy and associated products years we shall: second largest producer of electricity operations to Statkraft Norfund Power strategy. Today, Statkraft is • Further improving the profitability of dis- based on renewable energy sources. Invest (SN Power), which Statkraft owns Europe’s second largest producer tribution and end-user sales by meeting • Significantly strengthen the company’s together with Norfund, the Norwegian of electricity based on renewable the demand for energy and associated financial position The group employs around 1,970 fulltime Investment Fund for Developing Countries, services in close cooperation with our • Improve profitability in the Statkraft equivalent people, including the regional through a joint venture company, pending energy sources.

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