The underlying profit or loss is based on the regulated permitted revenue, whereas the recorded profit or loss will depend on stipulated tariffs and congestion revenues. The difference (higher or lower revenue) will level out over time through adjustment of tariffs, ensuring that Statnett's accumulated revenue corresponds with the regulated permitted revenue. The Group reported a profit after tax of NOK 328 million in the second quarter of 2014 (loss of NOK 20 million), and NOK 499 million in the first half of 2014 (NOK 64 million). The reported profit after tax was lower than the underlying profit in both the quarter and the first six months of 2014.
The Group's operating revenues in the second quarter of 2014 was NOK 1 452 million, compared to NOK 1 124 million for the same period in 2013. Total operating revenues for the Statnett Group for the first half of 2014 amounted to NOK 2 776 million (NOK 2 385 million). The increase was due to both higher tariff revenues and higher congestion revenues.
The Group's operating costs totaled NOK 937 million in the second quarter of 2014 (NOK 1 103 million). The reduction was mainly due to lower transmission loss costs and lower depreciation and write-downs. Operating costs as of the first half of 2014 amounted to NOK 1 968 million (NOK 2 192 million). The reduction was mainly due to lower system services costs and transmission loss costs, as well as wage and staff costs.
Statnett is planning and implementing major development projects. The Statnett Group invested NOK 2 862 million in the first half of 2014, compared to NOK 2 812 million for the same period in 2013.
Statnett's higher/lower revenue
Statnett's operating revenues mainly derive from grid operations regulated by the Norwegian water resources and energy directorate (NVE), which stipulates a cap (permitted revenue) for Statnett's revenues. Permitted revenue increased from NOK 2 700 million in the first half of 2013 to NOK 2 994 million in the first half of 2014. If the total revenues from grid operations for one year diverge from the permitted revenue, so-called higher or lower revenue will occur. Higher/lower revenue will level out over time through adjustment of future grid tariffs. The lower revenue for the first six months of 2014 amounted to NOK 281 million (lower revenue of NOK 402 million). Accumulated higher revenue including interest was NOK 2 155 million at the end of the first half of 2014. The reduction is in line with the plans to reduce accumulated higher revenue over several years.
Statnett's Grid Development Plan forms the basis for the next generation central grid and power system. Statnett will invest considerably in new capacity in the main grid during the next decade. Extensive construction activity is ongoing, and several projects will be completed in 2014 and the following years. Furthermore, Statnett is working to realize the construction of interconnectors to Germany and the UK, which are scheduled for completion in 2018 and 2020 respectively. The investment program aims to maintain the future security of supply, contribute to value creation and pave the way for better environmental solutions in Norway.
Chief Financial Officer
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