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Fortum welcomes emergency support package for energy firms

"It's crucial to keep companies operational," says the majority-state-owned energy giant.

Fortum, headquartered in Keilaniemi, Espoo, is by far Finland's biggest energy company. Image: Rinna Härkönen / Yle

Finland's biggest energy firm, Fortum, praised the government decision on an emergency support package for companies in the sector, announced on Sunday evening.

The centre-left government said it is preparing to finance energy companies with a loan and guarantee package of 10 billion euros. Parliament is to consider the bill on Monday.

Finance Minister Annika Saarikko (Cen) said that the state would not be offering "free money" but rather loans and loan guarantees with "extremely strict conditions" that would only be used as a last resort to ensure liquidity.

Majority-state-owned energy giant Fortum emphasised that maintaining operating conditions is important in a period of fluctuating prices.

"We appreciate [the] Finnish and Swedish governments taking swift action to stabilise the Nordic derivatives market and support Nordic energy companies in time of crisis. It's crucial to keep companies operational. Our discussions with the Finnish government are ongoing," Fortum said in a tweet soon after the government press conference on Sunday evening.

Later the company added: "In addition to managing the acute crisis, the EU urgently needs to revise the EMIR [European Market Infrastructure] regulation. Great that Finland will take this up in the EU energy ministers' emergency meeting next Friday. We hope to see the other Nordics join!"

"Too big to fail"?

Over the weekend Finland and neighbouring Sweden – home to the Nasdaq Nordic electricity futures exchange – announced plans to offer billions of dollars in liquidity guarantees to power companies in a bid to prevent collateral requirements from toppling them.

News agency Reuters reported on Sunday that EU ministers will meet this Friday to discuss urgent bloc-wide measures to respond to the surge in gas and power prices following Russia's restrictions on gas deliveries.

That has particularly hit Fortum's German subsidiary Uniper. In July the German government agreed to help rescue Uniper after it lost some 12 billion euros in the first half of 2022.

Fortum lost more than nine billion euros between April and June of this year.

In late August, Fortum CEO Markus Rauramo said the company would need state support to meet the power exchanges' collateral requirements.

The firm also stands to lose significant sums over its investment in the failed Fennovoima-Rosatom nuclear venture. The state owns about 51 percent of Fortum, with other public sector investors also holding minor stakes.

Its share price fell by about five percent on the Helsinki stock exchange on Monday morning.

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