We both want to significantly reduce emissions from energy production without jeopardising the security of supply of electricity and heat or raising energy prices unreasonably. Uniper is a successful, international energy provider and trader, and a great match with Fortum. Uniper’s hydro, nuclear and gas power is needed to realise Europe’s energy transition. Together we create for Europe a leading energy company.
The work to align the companies’ strategies and develop a shared vision is beginning. The strategy Uniper published a few weeks ago is a good starting point; at its core is phasing out coal in Europe, converting fossil production, growing the gas business, and developing hydrogen and other new solutions. This is very much in alignment with Fortum’s strategy that is strongly weighted to carbon-free energy production. Additionally, we are building significant new business related to the circular economy.
Our goal with the strategy work is that we will set concrete and ambitious emissions reduction targets for both companies by the end of this year.
Good momentum in the transition
Fortum has committed to shared efforts to mitigate climate change. We have a common goal with others who share the climate concern: reducing carbon dioxide emissions and replacing the use of coal. We are working every day towards this in many ways. We invested about 400 million euros in carbon dioxide-free production in 2019 – one hundred million more than in 2018.
With the Uniper investment, Fortum’s emissions-free electricity production capacity grew by about 63%. Fortum and Uniper are together Europe’s third largest producer of carbon-free electricity.
Uniper – a profitable investment in Europe’s energy future
Production that secures the functionality of society at all times is needed alongside intermittent renewable energy. In the Nordic countries, this need is met with hydro and nuclear power – and Uniper and Fortum both have a lot of it. Uniper owns about 200 hydropower plants with total capacity of 3.6 gigawatts in Sweden and Germany. This capacity exceeds that of all the hydropower plants in Finland combined.
In Central Europe, gas plays a key role, and it too is being made greener all the time. Uniper is a pacesetter in this development work. Fortum shares Uniper’s view that natural gas is needed as a replacement for coal so that delivery reliability can be maintained and emissions can be reduced. Gas also enables added investments in wind and solar energy. Uniper is also developing renewable energy storage solutions, especially hydrogen-based, in which it can utilise its gas expertise and its gas infrastructure.
With Uniper, Fortum’s share of carbon-free production grows by 60%. Coal accounts for about 12% of the combined production of the companies.
The share of coal in Fortum’s and Uniper’s production will decrease quickly in the upcoming years. In discontinuing the use of coal, it makes sense to decommission the most polluting power plants first. If the law phasing out German coal power is enacted, Uniper has announced that it will decommission 3,000 MW of old coal capacity, which is three times more than the capacity of the new Datteln 4 power plant. Overall, Uniper’s coal power capacity will be cut in half by the end of 2025, and the company is aiming for its electricity and heat production in Europe to be carbon-neutral in 2035.
The new EU Commission is pursuing carbon neutrality for the European Union by 2050.