Annual Report 2018

Towards the future with strong skills

I took over as the CEO of Pohjolan Voima in August 2018, when Lauri Virkkunen, who had headed Pohjolan Voima for eight years, retired. I have been greatly impressed by the highly skilled employees of Pohjolan Voima and their commitment to their jobs as well as by our extensive networks. We bring resources together with a strong focus on the future.

The energy sector is more regulated by political decision-making and regulation than many other lines of business. We expect political leaders to have the ability to see and understand the big picture instead of partial optimisation. The mitigation of climate change is an important, common issue. At the same time, it is important to take care of our electricity system’s cost competitiveness and markets.

We tightened our climate goals in celebration of our anniversary

Pohjolan Voima celebrated its 75-year journey in 2018. The main theme of our anniversary was an energy future in which the megatrends pointing the way forward for the energy sector include climate change, digitalisation and the increasingly strong role of customers.

We tightened our climate goals to mark our anniversary. We now aim to increase the share of carbon-neutral electricity production to more than 95 per cent by 2020. We are already well on our way to achieving this goal, given that the share of our carbon-neutral production last year was nearly 90 per cent.

Agile pilot projects making use of digitalisation

In 2018, we initiated experimental, low-threshold pilot projects based on intelligence in hydropower and thermal power. The pilot projects improve our understanding of the many opportunities offered by analytics and allow us to look for novel ways by which to manage our power plant assets safely, efficiently, reliably and economically. A good example of such initiatives is our hydropower company’s groundbreaking collaboration with the University of Oulu, aiming to find out which factors slow down the control of a hydropower plant and how to further develop this control.

Strengthening our corporate culture together

In 2018, we worked especially hard to strengthen our corporate culture. In particular, we aimed to inspire, communicate, listen and engage. Together with our personnel, we defined our strategic skills, energised in a shared well-being project, piloted the practices of work independent of time and place, and strengthened the role of each of us as a communicator.

According to the 2018 personnel survey, 86 per cent of our employees consider Pohjolan Voima to be a good workplace as a whole. Our employees value Pohjolan Voima’s strong atmosphere and community spirit, our competence and openness to change, as well as flexible work practices. We received a Great Place to Work® certificate, a recognition for the building of a good workplace and the creation of a corporate culture based on trust.

Close cooperation with hydropower stakeholders

Due to the dry summer, the production of our hydropower company in 2018 was, at 1.5 TWh, slightly below a normal water year. We modernised the electricity and automation systems and overhauled the turbines and generators of the lowermost hydropower plant in the Iijoki river, Raasakka. The modernisation improves the availability of the power plant and provides a boost to load-following capacity.

In the revival of migratory fish, we relied on wide cooperation and a diverse set of means. Our hydropower company continued the Iijoen otva waterway project vision together with the municipalities of the Iijoki area. We prepared a division agreement, referred to as the Iijoki agreement, on the implementation of the Iijoki waterway vision and action plan for 2019–2023.

In the context of the Iijoki migratory fish spearhead project, we planned the fishway of the Raasakka power plant. The Natural Resources Institute Finland designed steering booms for the downstream migration of the migratory fry of salmon and trout, meant to be installed in the summer of 2019. The project aiming to develop what is referred to as the old riverbed of Raasakka progressed. At Isohaara, along Kemijoki, we tested the Kalasydän solution in cooperation with other hydropower operators.

Asset management and environmental permits at thermal power plants

Pohjolan Voima’s combined heat and power plants produce district heat and process steam for local industry and communities, as well as electricity. We invested in solutions which improve the competitiveness, flexibility and efficiency of our plants’ energy production and reduce emissions at the same time. In 2018, we carried out extensive annual maintenance at our Kymin Voima biopower plant in Kuusankoski, Kouvola, thereby ensuring the plant’s good availability for years to come. A project which improves the controls of the power plant’s boiler by enhancing combustion management was kicked off at our Kaukaan Voima biopower plant in Lappeenranta. We continued our preparations to meet the requirements for the best available techniques for large combustion plants and secured permits for our plants.

We continued the preparation for dismantling the coal-fired condensing power plants in Kristiinankaupunki and Tahkoluoto, Pori, and looked for opportunities to utilise the infrastructure. We sold the shares entitling us to the production capacity of the Meri-Pori coal power plant to Fortum.

Hot tests and full-scale final disposal test at Olkiluoto

We carried out the largest modernisation work in the history of our joint venture TVO’s Olkiluoto nuclear power plant and furthered the development of the safety culture. In September 2018, the government granted an operating licence for OL1 and OL2 for the next twenty years. The hot tests of the OL3 plant unit were concluded, the training of the operating personnel continued, and we received the first decisions of authorities on the operator licences. According to the schedule updated by the plant supplier in November 2018, regular electricity production of OL3 will begin in January 2020.

Posiva Oy is constructing a safe disposal facility for its owners’ spent nuclear fuel on the Olkiluoto island. A full-scale in-situ system test (FISST) realised in the demonstration facilities of Posiva’s disposal facility started. The test aims to prove that Posiva’s safe disposal concept can be realised as planned.

Continuous development of responsibility

Every year, we select a few points of our action programme for responsibility on which to focus. We progressed as planned in terms of the 2018 development targets concerning responsible operations in the development of safety management and the value chain’s responsibility as well as in the assessment of the circular economy. Pohjolan Voima’s own employees did not have any accidents leading to absence from work (LTA1); our suppliers had three. We were unsuccessful in our attempt to improve our dialogue with non-governmental organisations as planned.

Towards the future skilfully, boldly, together

The energy sector takes care of people’s basic needs: power and heat. Pohjolan Voima produces power and heat at cost price to its customers, who are simultaneously our shareholders. In this way, we contribute to ensuring the success of our customers and indirectly create jobs and well-being across Finland. All in all, we did well in this task in 2018. I am happy of the fact that our customer satisfaction is on a good level. My thanks for a successful year go to all of Pohjolan Voima’s employees, customers and partners. At the same time, I also wish to thank my predecessor Lauri Virkkunen.

After our celebratory year, we continue to look to the future. The electrification of societies increases the importance of the energy sector. The industry’s future does indeed look bright. Our launch pad for the future is made up of our skilled, competent, and committed personnel, solid Finnish ownership, and our strong values – skilfully, boldly, together.

Ilkka Tykkyläinen
President and CEO, Pohjolan Voima Oyj