Fortum continues its virtual power plant experiment with the launch of the biggest Nordic electricity storage pilot project

FORTUM CORPORATION PRESS RELEASE 22 April 2016

Fortum is launching the Nordic countries’ biggest electricity storage pilot
project incorporating Saft’s megawatt-scale Li-ion (lithium-ion) battery energy
storage technology. The objective is to research the suitability of batteries
used for storing electricity to maintain a power balance in the electricity
system. Additionally, the research will explore new opportunities offered by
electricity storage and by the flexible intermediate storage of electricity.
For the project, Saft’s Li-ion containerised battery system with a nominal
output of 2 megawatts (MW) and 1 megawatt hour (MWh) of energy capacity will be
installed at Fortum’s Suomenoja power plant in Finland.

“We are also researching the battery’s optimal use together with the production
and the demand flexibility-based virtual power plant,” says Tatu Kulla, Head of
Operations, Fortum.

The battery project is an extension of Fortum’s pioneering experiment started
in March in which a virtual power plant based on demand flexibility is being
built together with customers. The capacity of this power plant will be offered
to the national grid company Fingrid to maintain a continuous power balance in
the electricity system.

The planning of the Suomenoja battery project has been started, and the aim is
to start the installation work during September 2016. Test use of the
electricity storage is estimated to begin in October. The battery will be
supplied by Saft, the world leader in the design and manufacture of advanced
technology batteries for industrial applications. The project’s investment cost
is about two million euros, for which Fortum will receive a 30 per cent energy
investment subsidy from the Ministry of Employment and the Economy.

Suomenoja is an ideal test environment for the pilot because the power plant
already has in use an industrial-scale heat pump station, which produces about
300,000 MWh, i.e. as much as 15 per cent of Espoo’s district heat demand.
Additionally, one of Finland’s biggest thermal batteries is currently under
construction at the plant; it can store about 800 MWh of thermal energy. This
is equivalent to the heat consumption of about 13,000 single-family homes per
day.

“Increasing the amount of energy produced with solar and wind power will
increase the need for regulating power that balances the electricity network
and for new storage solutions. When the weather is sunny or windy, there is
plenty of energy production, but less demand, so it makes sense to store the
electricity. In this project we are also researching new business models that
can be developed with electricity storage for electricity companies and
customers,” Tatu Kulla says.

"We look forward to working in cooperation with Fortum in this important
project to develop future operational and business models for advanced Li-ion
energy storage systems in electricity grids", says Glen Bowling,
Transportation, Telecom & Grids Senior Vice President Sales at Saft.

Fortum Corporation
Corporate Communications

Further information:
Tomas Qvickström, Head of Business Development, tel. +358 50 453 6298
Tatu Kulla, Head of Operations, tel. +358 400 294 499

Read more about the demand flexibility and its use in maintaining a power
balance:
http://www.fortum.com/en/corporation/research-and-development/virtual%20power%20
plant/pages/default.aspx

Electricity storage
Electricity storage is a part of the future energy system, the so-called solar
economy. With the intermediate storage of electricity, supply and demand can be
better balanced, and the storage can also function as an electricity network
stabiliser in malfunction situations. Other advantages of electricity storage
include its ability to be instantly deployed and its easy adjustability.
Moreover, electricity storage reduces the need for fossil fuel-fired peak load
plants.

Fortum
Fortum’s vision is to be the forerunner in clean energy. We provide our
customers with electricity, heat and cooling as well as other energy solutions
that improve present and future life. Already 64% of our electricity generation
is CO2 free. Our main markets are the Nordic and the Baltic countries, Russia,
Poland and India. In 2015, we employed some 8,000 energy sector professionals,
and our sales were EUR 3.5 billion. Fortum’s share is listed on Nasdaq
Helsinki. www.fortum.com

Saft
Saft (Euronext: Saft) is a world leading designer and manufacturer of advanced
technology batteries for industry. The Group is the world’s leading
manufacturer of nickel batteries and primary lithium batteries for the
industrial infrastructure and processes, transportation, civil and military
electronics’ markets. Saft is the world leader in space and defense batteries
with its Li-ion technologies which are also deployed in the energy storage,
transportation and telecommunication network markets. More than 4,100 employees
in 19 countries, 14 manufacturing sites and an extensive sales network all
contribute to accelerating the Group’s growth for the future. Saft batteries.
Designed for industry. www.saftbatteries.com