Interim Report 02:11. Page 1 Statnett Report 2:2011

Transcription

1 Q2 Interim Report 02:11 Page 1 Statnett Report 2:2011

2 Table of contents 02: Directors' report Statement of comprehensive income Balance sheet Statement of changes in equity Cash flow statement Page 2 Statnett Report 2:2011

3 In short Highlights Total operating revenues for the Group in the second quarter of 2011 amounted to NOK million (NOK million in the second quarter of 2010). The Group's operating revenues for the first half of the year totalled NOK million (NOK million in the first half of 2010). The Group reported a profit after tax of NOK 126 million in the second quarter of 2011 (NOK 446 million). The Group's profit after tax for the first half of 2011 was NOK 520 million (NOK million). The reduction was due to a reduction in tariff revenues, due to a downward adjustment of tariffs, and lower congestion revenues as a consequence of lower price differences in the Nordic region. This is also reflected in the higher revenue which totalled NOK 161 million in the second quarter of 2011 (NOK 429 million) and NOK 490 million in the first half of the year (NOK million). The higher revenue will be returned to Statnett's customers over time through adjustment of tariffs. In the second quarter, Statnett s facility operations were characterised by high inflow, a significantly improved power situation and increased maintenance activities. Statnett experienced more stable operations than in the first quarter, which was characterised by several outages. Statnett has a significant project portfolio and, in general, there has been steady progress in Statnett s development projects throughout the quarter. This resulted in a high activity level and extensive utilisation of capacity. Furthermore, Statnett has seen a positive development in terms of the number of lost-time injures which were reduced in the second quarter, and has intensified its focus on Health, Safety and the Environment in line with the increased activities in the company. Important events Statnett has received notification of a final decision from the Ministry of Petroleum and Energy (MPE) and has been granted a permit to construct two sections of the Ørskog Fardal (Sogndal) project. The Board of Statnett has decided to initiate the construction work on these sections and has made a decision in principle to invest in the rest of the project. The construction work is scheduled to start in the autumn of 2011 and the construction period is estimated to four years following a final licence decision for the whole section. The construction of the power line between Sima and Samnanger has not progressed as planned in the last quarter. The main reason for the delay is that Statnett has not been granted access to start the construction work on the whole section. The power line is now scheduled for completion in The current vulnerable power supply to the Bergen area will thus be extended by one winter. Statnett and BKK have implemented several measures to prevent extensive power outages, but consider the situation to be serious. Should a fault occur on one of the main power lines, the current grid will not have sufficient capacity to supply the entire area on cold winter days. In a dry year, the situation may be very strained. On 18 April, a fault occurred on the NorNed cable, approximately 300 metres off the Dutch coast. The repair work progressed faster than expected and the connection was re-established and made available to the market on 5 June. A helicopter belonging to Nordlandsfly crashed in Trofors in Nordland during upgrades of the Statnett power line between Nedre Røssåga and Tunnsjødal. The two people on board, the pilot and a representative from Statnett s supplier, were injured, but did not sustain any life-threatening injuries. The reason for the accident has not been determined. However, Statnett has launched an internal investigation of the accident in addition to the police and the Accident Investigation Board investigations. Kolbjørn Almlid was appointed the new chair of Statnett at the Enterprise General Meeting on 29 June The new chair replaces Bjarne Aamodt, who has been chairman of the Statnett Board of Directors since May Page 3 Statnett Report 2:2010

4 Directors' report Normal Alert N05 N02 N03 N01 N04 Strained Very tight Rationing The power situation at the end of june. Quality and security of supply The power situation was characterised as alert in Northern and Central Norway at the start of the second quarter. The situation in Southern Norway was considered strained. The power situation improved throughout the quarter. As a result of high temperatures in April, the inflow from snow melting started at the beginning of April, rather than at the normal time at the end of April. High inflow in the second quarter resulted in a significantly improved energy balance and the power situation was changed to normal from 15 April. Investments Statnett has major development projects under planning and implementation in order to maintain security of supply, create value and facilitate lower greenhouse gas emissions. In total, Statnett has invested NOK million in the first half of the year (NOK 705 million), which is the sum of commissioned and ongoing investment projects. Reservoir levels at the end of June were at 62 percent, 10 percentage points higher than at the same time in 2010 and two percentage points above the median (for the measuring period 1993 to 2010). Despite the high temperatures, high inflow and reservoir levels above normal in the second quarter, there was a hydrological balance deficit in Norway of 11.5 TWh at the end of June. The reason for this was very little snow in the mountains. Investments Statnett Group MNOK The overall power consumption in the second quarter was 26 TWh and the overall power production was 25 TWh. This resulted in net imports of one TWh for the quarter. Net imports for the corresponding period in 2010 were five TWh. The lower consumption and higher inflow than normal for the season reduced prices from first quarter significantly. In addition, the prices for each area took a turn in the second quarter; from high prices and imports in NO1, NO2 and NO5 until May, to low prices and exports in June. NO5 had the lowest average price in the Nordic region during this period, primarily due to a large surplus in reservois in June Q Q Q Q Q Q2 There were few significant power system incidents in the second quarter. On 7 April, there was an outage in Viklandet - Ørskog and a short blackout between Ørskog and Åskåra, which included the town of Ålesund. On 18 April, a fault occurred on the NorNed cable. Repair work was completed and the cable was made available to the market on 5 June. Page 4 Statnett Report 2:2011

5 Overview of major investement projects Project Location Cost Time Ongoing major investment projects Funds granted Estimated completion Sauda - Liastølen Rogaland NOK 190 million 2011 Increased preparedness: New back-up transformers Southern Norway NOK 250 million 2011 Major investment in transformer stations Southern Norway NOK 700 million Oslofjorden (Teigen - Evje) The Oslofjord NOK million 2012 Sima - Samnanger Hordaland NOK million 2013 Varangerbotn - Skogfoss Finnmark NOK 500 million 2013 Skagerrak 4 Norway/Denmark Statnett share NOK million 2014 Licences pending or appealed Estimated cost Earliest completion Voltage upgrade in Central Norway Subsection Klæbu Namsos Trøndelag NOK 430 million 2013 Hamang station 1 Asker/Bærum NOK million 2013 Namsos Roan Storheia Trøndelag NOK 850 million 2014 Voltage upgrade in southern Norway Subsection Kristiansand - Bamble (eastern corridor) Agder/Telemark NOK 650 million 2014 Ofoten Balsfjord Nord-Norge NOK million 2014 Grid reinforcement Grenland region Grenland NOK 850 million 2014 Ørskog Fardal 2 Sunnmøre/Sogn NOK million 2015 Voltage upgrade in southern Norway Subsection Feda - Tonstad (western corridor) Agder NOK 460 million 2016 Balsfjord Hammerfest Troms/Finnmark NOK million Storheia Snillfjord Trollheim/Orkdal Sør-Trøndelag / Møre og Romsdal NOK million Planning proposal submitted Estimated cost Earliest completion «Arctic Circle» Skaidi Varangerbotn Northern Norway NOK million ICT projects Funds granted Estimated completion Modernisation of ICT infrastructure in Statnett stations NOK 110 million 2011 Computer network for power system management NOK 220 million 2014 Renewal of Statnett's central operations system NOK 490 million 2014 New Regulation and Market System NOK 240 million Two alternatives are under evaluation 2 Licence granted for to sections See and Statnett's grid development plan for more information about the projects. Page 5 Statnett Report 2:2011

6 Important project events in the second quarter Ongoing major investment projects Sima - Samnanger: The construction of the line has now started on several sections along the route. However, Statnett has not gained access to all properties. Furthermore, a final clarification has not yet been made relating to conservation of a few cultural heritage sites along the licensed route. Despite the delays that this has entailed, Statnett has made positive progress in this respect and assumes that land acquisition and handling of the cultural heritage sites will be concluded in the autumn of Moreover, a number of demonstrations have taken place in connection with the project. Statnett has made a choice to avoid confrontation with demonstrators and has chosen to move the work away from the demonstration sites. So far, the demonstrations have not resulted in any delays of significance. In some cases, Statnett has requested assistance from the police, but primarily to ensure the safety of Statnett and contractor employees. Sauda - Liastølen: A breakdown of one of the pylons in April, resulted in a temporary halt in the work. Construction was resumed in May. The contractor has been ordered to implement security measures, and Statnett has deployed expertise to assess the quality of the ground and foundations at all pylon points. Implications for progress and costs are being evaluated. Licences pending or appealed Ørskog - Fardal (Sogndal): Statnett has received notification of a final decision from the Ministry of Petroleum and Energy and has been granted a permit to construct two sections of the project. The Board of Statnett has decided to initiate the construction work on these sections and has made a decision in principle to invest in the rest of the project. Statnett has been asked to assess yet another alternative site for a station in Sykkylven in connection with the ongoing licensing process. A final resolution for the remaining part of the project is expected in the fourth quarter of Voltage upgrade Eastern Corridor, Kristiansand Bamble/ Kragerø: The Board of Directors has made a decision in principle to realise the project. A licence from the Norwegian Water Resource and Energy Directorate (NVE) is expected during the summer Grid developments Grenland (Eastern Corridor, Bamble/ Kragerø Rød): A licence application has been submitted to the NVE for processing and a consultative process has been implemented. A request for additional assessments is expected in the third quarter of Ofoten - Balsfjord and Balsfjord - Hammerfest: Additional assessments have been submitted to the NVE together with the required additional applications. The NVE has notified Statnett that the final inspections will be conducted in the autumn of Voltage upgrades Western Corridor and Nord.Link: The NVE has terminated the consultative process for the licence applications for Nord.Link and the voltage upgrade on the Feda - Tonstad section. A request for additional assessments has not yet been received. Storheia - Snillfjord - Trollheim/Orkdal: Comprehensive requirements relating to additional assessments have been received from the NVE. These are scheduled for submission to the NVE in the fourth quarter of Namsos - Roan - Storheia: The project has been appealed to the Ministry of Petroleum and Energy. Planning proposal submitted Skaidi - Varangerbotn: Impact assessment programme received from the NVE. The work on licence applications including associated impact assessments is scheduled to start in Financial results The quarterly report has been submitted in accordance with International Standards for Financial Reporting (IFRS) and interpretations stipulated by the International Accounting Standards Board (IASB). The accounting standards for presentation of financial accounts (IAS1) and interim reports (IAS34) have been adhered to. The accounting principles and calculation methods used in the interim financial statements are the same as in the most recent annual financial statement. Operating revenues The Group's operating revenues in the second quarter of 2011 totalled NOK million (NOK million in the second Page 6 Statnett Report 2:2011

7 quarter of 2010). Operating revenues from regulated operations totalled NOK million (NOK million), while other operating revenues amounted to NOK 35 million (NOK 122 million). The reduction in operating revenues was primarily caused by lower tariff revenue on the basis of lower stipulated tariffs for 2011 compared with Tariffs were higher in 2010 in order to cover accumulated lower revenue. The tariffs for 2011 are considered to be at a long-term level. In addition, congestion revenues were somewhat lower due to lower area price differences in the Nordic Region. The Group's operating revenues for the first half of the year totalled NOK million (NOK million in the first half of 2010). Operating revenues from regulated operations totalled NOK million (NOK million), while other operating revenues amounted to NOK 79 million (NOK 168 million). Statnett's operating revenues mainly derive from regulated grid operations. Operating revenues from regulated activities in Statnett s financial reporting consist primarily of grid tariffs from the customers as well as congestion revenues (price differences between areas in the Nordic region and towards the Netherlands). The grid operations are regulated by NVE which stipulates a cap for Statnett's revenues (permitted revenue). If the total revenues from grid operations for one year diverge from the permitted revenue, a so-called higher or lower revenue will occur. Higher/lower revenue will level out over time through adjustment of future grid tariffs. In the second quarter of 2011 Statnett's higher revenue amounted to NOK 161 million (higher revenue of NOK 429 million). Higher revenue for the first half of the year amounted to NOK 490 million (higher revenue of NOK million). At the end of June the accumulated higher revenue including interest was NOK million. Operating costs The Group's operating costs totalled NOK 951 million in the second quarter of 2011 (NOK 925 million). System services costs increased by NOK 20 million primarily due to higher purchasing costs of primary reserves in This was due to an amendment of the rules relating to purchasing of primary reserves which came into effect in May Producers are now paid market prices for all supplies, whereas in 2010 prices were low for the required basic supply of reserves. Wage costs increased by NOK 19 million in the second quarter of 2011 compared with the corresponding period in This was due to an increase in staff in 2010 and 2011 as a result of increased activities in development projects, operations and maintenance. Due to high utilisation of capacity related to development projects, a higher proportion of the wage costs have been allocated to investment work in the balance sheet, thus reducing the growth in wage costs. Depreciation increased by NOK 20 million in the second quarter of 2011 due to increased investments. Other operating costs were NOK 38 million lower than in the corresponding period in This was due to repair work on the NorNed cable on behalf of TenneT in Operating costs in the first half of 2011 amounted to NOK million (NOK million). System services costs were reduced by NOK 33 million. This was primarily due to reduced costs of special adjustments. Transmission losses were NOK 40 million lower than in the first half of 2010, attributed to lower volume. Wage costs were up NOK 60 million in first half of 2011 compared to the same period In 2010 costs were reduced by NOK 39 million in connection with changes to the regulations related to pensions. Remaining increase is related to an increase in staff throughout 2010 and Depreciation increased by NOK 41 million in first half of 2011, in line with the increased investments. Other operating costs reflect an increased activity level, but were down NOK 20 million compared to 2010 due to the repair of the NorNed cable conducted in 2010 on behalf of TenneT. Operating profit The Group's operating profit in the second quarter of 2011 was NOK 238 million (NOK 648 million). The Group's operating profit for the first half of the year was NOK 859 million (NOK million). Page 7 Statnett Report 2:2011

8 Financial items The Group's net financial items for the second quarter of 2011 amounted to a loss of NOK 63 million (loss of NOK 41 million). Net financial items for the first half of 2011 amounted to a loss of NOK 132 million (loss of NOK 106 million). Net profit The Group's profit after tax was NOK 126 million (NOK 446 million) in the second quarter of For the first half of the year, the Group's profit after tax totalled NOK 520 million (NOK million). Lower tariff revenues and congestion revenue are the main reasons for the reduction in profit. Cash flow and balance sheet The Group s operating activities generated an accumulated cash flow of NOK 829 million in the first half of The net cash flow from investment activities totalled a loss of NOK million. In total, loans were paid down by NOK 850 million, and new loans of NOK million were raised. At the end of the first half of the year, the Group's liquid assets and market-based securities amounted to NOK million (NOK million). At the end of the first half of 2011, the Group had total assets of NOK million (NOK million), and interestbearing debt amounted to million. The market value of interest swap and currency swap agreements (fair value hedges) related to interest-bearing debt was NOK million. Interest-bearing debt, corrected for this, amounted to NOK million. Subsidiaries Statnett SF owns Statnett Transport AS a 100 percent. In the first half of 2011, the Statnett Transport Group recorded operating revenues totalling NOK 57 million (NOK 48 million) and a profit before tax of NOK 2 million (NOK 1 million). Statnett has a shareholding of 50 percent in the NorGer project, which entails planning and building a DC subsea interconnector between Norway and Germany. In the third quarter of 2011, Statnett s share is expected to increase to 100 percent as the partners on 7 July announced that they want to use the option to sell their share in the project to Statnett. Risk Statnett's activities expose the company to risks. Below follows a description of some of the risks that may influence the supply of electricity and Statnett's value creation. Risks associated with power supply Significant risks relating to the power supply are the risk of outages (faulty components in the power system), power supply risks (the balance between production and consumption) and risks related to the energy situation. Statnett manages power supply risks through daily grid operations combined with grid investments, preventive maintenance and purchase of power reserves. Statnett works continuously to improve the company s preparedness to minimise the negative impact of any outages. The Board of Directors decided in fall 2010 that Statnett mainly will construct the power grid according to the N-1 criterion. This means that power supply to the end-user will be maintained even after a fault occurs in the transmission system. Statnett s goal is to ensure that all end-users have reliable power supply, and if a fault occurs in the transmission system, no end-user will be without electricity for more than two hours at a time. There have been several incidents in 2011 which have impacted end-users. The total cost of energy not supplied for connected end-users (under the KILE scheme) have been NOK 71 million so far in 2011 compared with NOK 17 million in the first half of Costs in 2011 are mainly related to grid failures in the first quarter. Statnett SF owns 30 percent of Nord Pool Spot AS. In the first half of 2011 Statnett s share of the result in Nord Pool Spot AS was a Group profit contribution of NOK 3 million (NOK 2 million). In the first half of 2010, there were additional revenues of NOK 7 million relating to Statnett's shareholding in Nord Pool ASA, which was sold in Regulatory risk Statnett s activities are subject to comprehensive regulatory requirements. Changes in the regulatory framework will affect Statnett's operations. Changes in the processing time of licence applications, for instance, could lead to acceleration or postponement of planned reinforcements of the main grid. Page 8 Statnett Report 2:2011

9 Project risk Statnett has a substantial portfolio consisting of planned and ongoing maintenance and development projects. Statnett conducts a thorough assessment of risk in connection with the projects. The Board is presented with risk assessments relating to all major investments. Statnett has implemented a uniform project management model with focus on risk management. Risk of serious health, safety and environment incidents (HSE incidents) Statnett's activities entail a risk of incidents associated with health, safety and the environment. This risk is reduced by implementing documented work processes, safe job analyses, a strong management focus on HSE, as well as the reporting of incidents and near misses in a learning perspective. Foreign currency risk Statnett's revenues are mainly in Norwegian Kroner (NOK), whereas some of the Group's expenses are in foreign currencies. Currency risk is minimised through several measures, including using currency swap agreements to hedge the risk in the currency obligations in investment projects. All Statnett s loans in foreign currency are converted to NOK through currency swap agreements. Interest rate risk A large proportion of revenues from grid activities are calculated as return on the enterprise's grid capital. The calculation is based on the interest rate on five-year government bonds and a risk supplement. Statnett's revenues are therefore affected by fluctuating interest rates. In order to reduce the enterprise s total interest rate risk, Statnett seeks to achieve as good a match as possible between movements in interest rates on loans and the interest rate used to calculate return on the enterprise s capital. settlement in the regulating power market. Procedures have been established for provision of security relating to trade in the regulating power market. Financial risk The risk of Statnett not being granted refinancing on the company's loans is low. The risk is reduced by Statnett having a spread maturity structure on existing loans. The enterprise has a credit facility totalling NOK 3.5 billion with a five-year term to be able to fund up to 12 months' operation without incurring any new debt. Statnett has long-term borrowing ratings of A+ and A2 from Standard & Poor s and Moody s Investor Service, respectively. Corporate social responsibility Statnett s objectives involves a comprehensive social responsibility. Statnett has the responsibility to maintain security of power supply in Norway in addition to provide for value creation within the Norwegian energy sector and facilitate lower greenhouse gas emissions. This social responsibility is ensured through a close and long term cooperation with domestic and regional authorities, participants in the power sector, customers, suppliers and other stakeholders, where also social and environmental issues are ensured. Corporate social responsibility (CSR) is embedded in the company s continuous corporate governance and anchored in the enterprise's management and organisation. See Statnett's annual report 2010 for more information about CSR. Health, Safety and Environment (HSE) Statnett has a strong focus on HSE at all levels of the organisation. In spite of this, Statnett has experienced several serious incidents in the first half year and has therefore initiated an HSE action plan. The action plan is a tool to ensure that the goal of zero injuries or work-related illnes, and a reduction in near misses is achieved. Credit risk Statnett assumes credit risk through placing surplus liquidity with securities issuers. Statnett has limits which set credit rating requirements for counterparties and maximum exposure limits for each individual investment of surplus liquidity. Statnett is also exposed to a limited credit risk related to the company's collection of main grid tariffs, and as responsible for balance Two serious contractor incidents occurred in the second quarter (breakdown of a pylon and a helicopter crash). The incidents were reported to the Board of Directors and Statnett has appointed its own investigation committee which will evaluate the causal links of the incidents and how working methods and processes can be improved. Page 9 Statnett Report 2:2011

10 H value rolling 12 months average Absence due to illness % 4% 3% 2% 1% 0 jun 10 jul 10 aug 10 sep 10 oct 10 nov 10 dec 10 jan 11 feb 11 mar 11 apr 11 may 11 jun Q Q Q Q Q Q2 Reporting of H-value is changed to 12-month's rolling average Planning of internal HSE audits and emergency drills for projects has been important in the second quarter. The Norwegian Labour Inspection Authority visited Statnett in June and reviewed the Regulations relating to safety and health requirements on construction sites and the company's interpretations and understanding of these. This was an exchange of information related to the Norwegian Labour Inspection Authority's expectations of Statnett. Statnett had no lost-time injures in the second quarter of 2011 and thus a lost-time injury frequency rate (H-value) for the Group of 0. This was the same as in the corresponding period in Statnett s contractors reported three lost-time injures in the second quarter of In the first half of 2011, Statnett had seven lost-time injuries. This resulted in an H-value of 8.2 for the first half of the year, compared to 1.4 for the first half of Statnett s contractors reported four lost-time injuries in the first half of Absence due to illness was 3.2 percent in the Group in the second quarter of 2011, compared to 3.7 percent in the second quarter of Outlook Statnett s main objectives are to ensure a stable supply of electricity and facilitate a well-functioning power market. Experiences last winter with several outages have shown that at times there are tight margins in the power system. The current power balance in the Norwegian system is characterised as good despite less snow in the mountains than normal. This will have a positive effect on security of supply in the immediate future. To secure a stable security of supply for the future, Statnett will make substantial grid investments in the years to come. Statnett s future activities will be dominated by high project activity, both within maintenance and through major development projects. In the autumn of 2011 there will be considerable focus on avoiding further delays in the progress of the Sima-Samnanger project. The project is now expected to be completed in This implies that the vulnerable power supply to the Bergen area will be extended by one winter. In the autumn of 2011 there will also be initiated construction of two sections of the Ørskog-Fardal line. This is an important power line which will ensure power supply to Central Norway. Further, Statnett will continue the development of projects which will secure reliable supply to Southern and South- Western Norway, and the Northern areas. To be able to realize the planned development projects, Statnett is dependent on an efficient licensing process. Statnett is concerned to further improve the cooperation with stakeholders in order to obtain important input in the process of planning and realization of new lines. In this regards, several initiatives are taken towards local and regional authorities and other stakeholders. Declaration from the board of directors and CEO We declare that, to the best of our knowledge, the accounts for the period 1 January to 30 June 2010 have been prepared in accordance with IAS 34 Interim Financial reporting, and that the information in the accounts provides a correct impression of the group s assets, liabilities, financial position and result as a whole. We also declare that, to the best of our knowledge, the half-year report provides a correct overview of important events in the accounting period and their influence on the halfyear accounts, the most important risk and uncertainty factors facing the business in the next accounting period, as well as significant transactions with closely related parties. Oslo, 15 July 2011 The Board of Directors, Statnett SF Page 10 Statnett Report 2:2011

11 Statement of comprehensive income Statnett Group Second quarter Year to date (Amounts in NOK million) Year 2010 OPERATING REVENUE Operating revenue regulated operations Other operating revenue Total operating revenue OPERATING COSTS System services Transmission losses Wage costs Depreciation and write-downs of tangible fixed assets Other operating costs Total operating costs Operating profit Revenues from joint ventures and associates Financial income Financial costs Profit before tax Tax Profit for the period OTHER COMPREHENSIVE INCOME Changes in fair value, held-for-sale investments Changes in fair value for cash flow hedges Tax related to other comprehensive income Other comprehensive income Total comprehensive income Page 11 Statnett Report 2:2011

12 Balance sheet Statnett Group (Amounts in NOK million) assets INTANGIBLE FIXED ASSETS Goodwill Other intangible fixed assets Total intangible fixed assets non current FIXED ASSETS Deferred tax assets Tangible fixed assets Plant under construction Investment in other group companies Long-term investments Total fixed assets CURRENT ASSETS Trade accounts recievable and other short-term receivables Investment in commercial market-based securities Liquid assets Total current assets Total current assets EQUITY AND debtliabilities EQUITY Contributed capital Retained earnings Non-controlling interest Total equity provisions for liabilities Deferred tax Pension liabilities Other liabilities Long-term interest-bearing debt Total long-term liabilities and debt CURRENT LIABILITIES Short-term interest-bearing debt Trade account payable and other short-term debt Tax payable Total current liabilities Total equity and debt liabilities Page 12 Statnett Report 2:2011

13 Statement of changes in equity Statnett Group Total equity Non- allocated to Total controlling the owner of Other equity Contributed (Amounts in NOK million) equity interest Statnett SF accrued Funds capital Equity as at 1 January Profit/loss for the year Other comprehensive income Dividends paid Non-controlling interest Equity as at 31 December Equity as at 1 January Profit for the period Other comprehensive income Dividends paid Non-controlling interest Equity as at 30 June Equity as at 1 January Profit/loss for the period Other comprehensive income Dividends paid Equity as at 30 June Page 13 Statnett Report 2:2011

14 Cash flow statement Statnett Group (Amounts in NOK million) Cash flow from operating activities Profit before tax Loss/gain(-) on sale of fixed assets Ordinary depreciation and write-downs Loss/ gain(-) on sales on investments on associates and joint ventures Interest recognised in the income statement for the period Interest received for the period Interest paid for the period Changes in trade accounts receivable/payable Changes in other accruals Profit/loss from companies using equity method Net cash flow from operating activities Cash flow from investing activities Proceeds from sale of tangible fixed assets Purchase of tangible fixed assets and plants under construction Merger NorGer net for cash acquired Changes in investments in associates and joint ventures Changes in long-term loan receivables Dividend received Net cash flow from investing activities Cash flow from financing activities Proceeds from new interest-bearing borrowings Repayment of interest-bearing debt Proceeds from sale of market-based securities Purchase of market-based securities Dividends paid Net cash-flow from financing activities Net cash flow for the period Cash and cash equivalents at the start of the period Cash and cash equivalents at the close of the period Included under the item cash and cash equivalents as at 31 March 2011 are reserved tax withholdings to the amount of NOK 43 million in the Group. Unused credit facilities of NOK million are not included in cash and cash equivalents above. Note 1 Accounting Principles The interim accounts for the first half of 2011 are presented in accordance with IAS 34. The interim accounts do not contain all the additional information required in the annual accounts, and should therefore be read in the context of the consolidated accounts presented on 31 December The accounting principles that have been applied for the interim accounts for the first half of 2011 are consistent with the accounting principles that were applied for the consolidated accounts presented on 31 December Page 14 Statnett Report 2:2011

15 Statnett Husebybakken 28B, Oslo PO Box 5192 Majorstuen N-0302 Oslo Telephone: Fax: Page 15 Statnett Report 2:2011