TVO receives further shareholder loan commitment

At an Extraordinary General Meeting yesterday, all of TVO's shareholders signed the addition to the agreement and commitment concerning the shareholder loan arrangement in accordance with the proposal presented by TVO's board of directors. TVO said it has drawn all subordinated shareholder loans under previous shareholder loan commitments.

The OL3 plant supplier consortium - Areva GmbH, Areva NP SAS and Siemens AG - is constructing the unit under a fixed-price turnkey contract. They have joint liability for the contractual obligations until the end of the guarantee period of the unit. The consortium began construction of Olkiluoto 3 in 2005. Completion of the reactor was originally scheduled for 2009, but the project has had various delays and setbacks.

In August, TVO said fuel loading at the Olkiluoto 3 EPR will now not take place until March next year, according to a revised schedule provided by the Areva-Siemens consortium. Grid connection is now scheduled for October 2021, with regular electricity production due to start in February 2022.

"Areva continues to prepare a financial solution to complete the project until the end of the guarantee period," TVO said. "In addition, the negotiations with the Areva-Siemens consortium concerning the terms for completing the project continue."

"TVO's shareholders are strongly committed to the OL3 EPR Project, which once completed, will cover circa 14% of Finland's demand for electricity. The Olkiluoto 1 and 2 plant units currently produce circa 17% of Finland's demand for electricity, and their operating licences are valid until 2038. Olkiluoto's three nuclear power plants enable the production of carbon dioxide-free electricity far into the future," said TVO CEO Jarmo Tanhua.

TVO was founded in 1969 by a number of companies to build and operate large power plants, supplying the electricity to shareholders at cost. The company is 27% owned by Fortum and 57% owned by Pohjolan Voima Oy (the major shareholders of which are pulp and paper manufacturers UPM Oyj and Stora Enso Oyj). Owners take their shares of electricity at cost, any unwanted portion being sold by them into the Nordic market. This means that output is effectively contracted to each owner over the life of the plant. The private owners are mostly heavy industry with a high demand for base-load power, and hence low costs are critical for them.