Fortum Keeps Atomic Secrets That Nordic Power Rivals Make Public

Fortum Oyj (FUM1V), Finland’s biggest utility, is choosing to delay nuclear-output data that its peers release instantly, forcing traders to pay third-party suppliers for the information that can determine power prices.

Fortum, which doesn’t release any such figures at all, will start to publish the data with a five-day delay by the end of this year, Mari Kalmari, a spokeswoman based in Espoo, Finland, said July 3 by phone. The deferral makes the information “quite useless,” according to Jari Hallivuori, the power-purchasing manager at Turku-based Oy Turku Energia, one of Fortum’s competitors.

The generator’s stance means the utilities, banks and industrial consumers that covet such data about Nordic reactors must buy it from Stavern, Norway-based Energyinfo AS, paying at least $35,000 a year. Teollisuuden Voima Oyj of Finland and Sweden’s Vattenfall AB have published real-time nuclear output for at least nine years, while Germany’s EON SE began in March.

“It’s important for market participants to have access at every moment to the same information on what each reactor produces, since their output directly affects power prices,” Jens Nordberg, a board member at the Nordic Association of Electricity Traders, said July 5 by phone from Gothenburg, Sweden. “If power output is not published in real-time, then there’s always someone sitting on insider information, even if they are not allowed to act on it.”

Fortum is bucking the decade-long culture of transparency in the Nordic power market, in which utilities publish real-time proprietary data voluntarily. Kalmari declined to say why the company isn’t following others offering instant data by choice.

Market Abuse

The custom among the majority of the Nordic nuclear operators goes beyond what is required under the EU’s Regulation on Wholesale Energy Markets and Transparency, a law designed to prevent market abuse and insider trading in energy markets, which came into force in December 2011.

The rules, known as Remit, require power producers to provide national grid managers with output data, which in turn will send the information on to Entso-e, the European industry group for network operators. The association will then publish individual plant data with a five-day delay, rather than instantly. The lag was deemed appropriate to increase transparency while also protecting companies’ production strategies, according to the European Commission.

“We own the data, and can publish it as we see fit,” Pasi Tuohimaa, a spokesman at Teollisuuden Voima, the operator of the two Olkiluoto reactors, said July 3 by phone from the plant on the country’s west coast. Publishing real-time information is a matter of transparency and openness for the company, he said.

Unexpected Halt

The Nordic market’s 14 reactors provide more than 20 percent of the energy consumed in a region three times the size of Germany and home to 25 million people. Together with output from the more than 3,000 hydro-electric plants in Norway and Sweden, they are the drivers of prices. An unexpected halt on Sept. 26 at EON’s 1,400-megawatt Oskarshamn-3 nuclear reactor, the region’s biggest, pushed day-ahead prices up 7.5 percent to a four-month high.

The debate over transparency centers around Fortum’s Loviisa-1 and Loviisa-2 plants, which began generating in 1977 and 1980, respectively, and produce about 10 percent of Finland’s electricity. The reactors, on the country’s south coast, had unplanned halts of 18 days last year, with Loviisa 1 unexpectedly cutting output by 51 percent, or 256 megawatts, on Nov. 16, according to the latest notification of interruptions. A supply of 1,000 megawatts is sufficient for about 2 million European homes.

Hidden Data

“It’s peculiar that Fortum only plans to issue data with a five-day delay, making the information quite useless and defeating the purpose of real-time transparency,” Turku Energia’s Hallivuori said July 2 by phone. “It also begs the question of what they want to hide. The power market wants Fortum to implement the same degree of transparency as its competitors.”

Fortum will comply with Remit, Kalmari said, declining to respond to questions about alleged secrecy.

“The directive stipulates a five-day delay, and we think it’s wisest to act accordingly,” she said.

The European Commission, the EU’s regulatory arm, wanted to ensure that sensitive market information such as real-time production data isn’t published in a way that allows power companies to learn competitors’ production strategies.

“It was decided to publish such data only with a delay that would exclude the main competition risks,” Nicole Bockstaller, a commission spokeswoman in Brussels, said by e-mail. “Five days were deemed to be an appropriate delay in this respect.”

Only Strategy

Nuclear reactors are most efficient if they operate at full capacity around the clock until they halt for scheduled maintenance outages, typically for 30 to 60 days every one or two years, Andrew Moulder, a senior utilities analyst at CreditSights Inc. in London, said by e-mail.

“That’s really the only production strategy one sees for atomic facilities in the Nordic market,” he said.

To get access to real-time data, traders have turned to Energyinfo, which has monitored nuclear reactors, hydro and coal-fired plants in the Nordic area since 2010 by measuring the magnetic field of cables leading out of power plants. The service covers 50 power plants with more than 30,000 megawatts of capacity, including Fortum’s reactors, Atle Haga, the company’s managing director, said July 5 when reached by phone. He declined to comment on fees.

Market-Moving Information

Since joint power trading for Norway, Sweden, Finland and Denmark started on Nord Pool in 2000, Fortum and its peers have to publicize any changes in capacity for plants bigger than 100 megawatts within an hour of the event to prevent insider trading. They aren’t allowed to buy or sell power until a filing is published by the exchange.

The Nordic regulations presaged the EU, which requires producers to declare in a timely manner potentially market-moving information, such as when plants stop and start.

Nord Pool’s market-surveillance unit monitors trading and whether information about halts and resumptions is available to all traders.

“It’s not good that power producers withhold info,” said Fredrik Bodecker, head of market trading at Skaerbaek, Denmark-based Dong Energy A/S, the country’s biggest utility. “However, as long as the Nordic power-market surveillance doesn’t demand more information from Fortum, the company has the full right to disclose what they choose, within the framework of existing market rules,” he said July 2 by e-mail. Dong doesn’t own any nuclear reactors.

Instant Numbers

Stockholm-based Vattenfall, the Nordic area’s biggest utility, has published live data from its Forsmark and Ringhals reactors since at least 2004. Fingrid Oyj, Finland’s network manager, publishes total nuclear output in real-time.

“Production data for nuclear reactors is important for the power market, since the basic assumption is that an atomic station operates around the clock unless it is undergoing maintenance,” Robert Pletzin, a spokesman for Vattenfall, said by e-mail. “Transparency creates trust and confidence.”

Finland’s four reactors provide about 30 percent of the nation’s power and have been operating at an average 95 percent of capacity in the past decade, according to the World Nuclear Association in London. That compares with Sweden’s 10 reactors, which ran at 75 percent of capacity last year, up from as low as 63 percent in 2009, according to Markedskraft ASA, the Arendal, Norway-based energy-analysis company.

“A low utilization rate, for instance 60 percent, indicates that the reactor may have problems, while a high rate, above 90 percent, indicates a well-operated reactor with a lower probability of accidents,” Nils Boehmer, a manager at Oslo-based environmental group Bellona, said July 5. “It’s incomprehensible that Fortum doesn’t wish to publish its output data.”

To contact the reporter on this story: Lars Paulsson in London at lpaulsson@bloomberg.net

To contact the editor responsible for this story: Justin Carrigan at jcarrigan@bloomberg.net

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