Satisfactory operating performance
2019 was both warmer and wetter than normal, and the power situation was good. Both system and infrastructure operations experienced a high level of stability. Security of supply was satisfactory, despite being defined as vulnerable in some areas. Although there were many periods of planned operational stoppages caused by extensive grid-related construction work, there were few incidents that resulted in power cuts for end users.
Construction projects made good progress
In 2019, construction of new infrastructure, including subsea interconnectors and major transmission line projects, made good progress. Several major, time-critical investment projects went into operation during the year. Among the largest construction projects completed in 2019 was the first stretch of the 420 kV Namsos to Surna transmission line. In the Western Corridor, the voltage was increased from 300 kV to 420 kV on several connectors, and the project reached an important milestone when the Saurdal to Ertsmyra transmission line went into operation. Good progress was made on both the interconnectors and NordLink was completed on the Norwegian side. BKK Nett AS completed the construction of the 420 kV Mongstad to Modalen connection, ownership of which has now been transferred to Statnett. The power industry’s shared data hub (Elhub) for the processing of meter readings from electricity customers is now in operation. Investment in the digitalisation of system operation and infrastructure management entered a new and wide-ranging phase in 2019.
We are about to enter the decade of electrification
2019 was a watershed year for the electrification of Norway, and there are strong indications that the 2020s will be the decade of electrification. The substantial investment projects that Statnett has undertaken over the past ten years gives Norway a competitive advantage in the energy transition needed to meet the world’s climate change targets. At the same time, Statnett recognises that electrification and measures related to the “green shift” are being implemented faster than the company expected just a couple of years ago. The connection volume handled in 2019 came to 7,387 MW, equivalent to more than Norway’s entire electricity consumption on one September day. The challenge of ensuring that developments in consumption and demand remain balanced will be a key issue in the years ahead.
New efficiency programme established
Statnett aims to be one of Europe’s 25 per cent most efficient TSOs. The latest TSO benchmark, which was published in the autumn of 2019, shows that this target was not reached. However, this is an expected outcome, since Statnett has carried out materially more extensive construction projects than the average of the European TSOs that we are benchmarked against. Despite this, Statnett’s efficiency was kept at 100 per cent in the revenue cap for 2020 set by the Norwegian Energy Regulatory Authority (RME). In 2019, Statnett established an efficiency programme that will run until the end of 2022. The company’s clear objective is to further improve its efficiency so that it is once again included in the 25 per cent most efficient TSOs in Europe.
Strong focus on HSE
To reach its overarching goal of being efficient, smart and secure, Statnett must make it possible for everyone who works at and for Statnett to return home safely at the end of the working day. In 2019, efforts were made to build up a strong professional resource pool to develop, qualify and implement safe solutions in all parts of Statnett’s operations. A focus area has been established at Statnett to highlight personal safety in the planning and performance of work. A number of improvement measures have been implemented to clarify the interface between Statnett as the construction client and the company’s contractors.
The company has succeeded in reducing the number of personal injuries, both those that result in lost time and those that do not. The reduction in the injury frequency rate from 2018 to 2019 has been particularly noticeable at our contractors. Statnett’s sickness absence rate is generally low, and came to 2.9 per cent at the close of the year (rolling 12-month figure), a decrease of 0.3 percentage points compared with the year before.
The corona epidemic affects the outlook
The outbreak of COVID-19 (the coronavirus) affecting our society so far in 2020 will also affect Statnett’s operations. Statnett has clear priorities in dealing with the pandemic. Our social mandate is to secure the power supply at all times and in any situation.
The working environment for Statnetts organisation is obviously affected due to the measures Statnett has choosen to adopt based on government guidelines and our own emergency plans. However, the current operational and financial effects on Statnett of the pandemic are limited. Statnett will continuously assess possible consequences and necessary measures to limit the negative effects on security of supply, operations, investment projects and financial position.
Profit for the year
In 2019, Statnett made an underlying profit after tax of NOK 2,465 million (NOK 1,934 million in 2018). The recognised profit after tax for the year came to NOK 1,906 million (NOK 2,213 million). Statnett’s total investments, including interconnectors, the purchase of grid infrastructure and ICT projects, came to NOK 9,618 million (NOK 12,377 million). Grid infrastructure constructed under the company’s own auspices and put into operation came to NOK 14,044 million in 2019 (NOK 6,487 million). These projects are contributing to stable operations, robust security of supply and value creation for existing and new production and consumption.