1. Key developments and challenges in the Nordic region - Eurelectric Members’ Day Oluf Ulseth CEO, Energy Norway Brussels, February 6, 2012

2. 2 Electricity Generation in Nordic Countries 2010 Hydro power Nuclear power Fossil fuels Wind power 17 TWh 145 TWh 77 TWh 37 TWh 123 TWh Total 399 TWh Source: ENTSO-E Oher RES Non-identifiable 25 % 75 % 28 % 40 % 17 % 14 % 53 % 19 % 18 % 7 % 3 % 1 % 95 % 4 %1 % 46 % 39 % 5 % 8 % 2 % 72 % 21 % 7 %

3. New generation – more transmission Investments in new emission free generation Swedish-Norwegian joint certificate market established in 2012 New RES targets in Denmark 2011 Substantial nuclear capacity under way in Finland Integrated markets Nordic system price - 12 price zones Several interconnection projects under construction (NO-DK, NO-SW, FI-ES, SW-LI) Projected power surplus in 2020, increases need for more transmission capacity with rest of Europe Nordic TSO initiative on common balancing management Active consumers using new technology Smart meters introduced in Sweden and Finland, under way in Norway Nordic power retail market in progress -> 2015?

4. Long term Nordic strategy for reduction of CO2-emissions Electricity and district heating industries in the Nordic countries fully committed to EU:s emission targets by 2020 Carbon neutral power generation and heat production before 2050 Three pillars: 1) Energy Efficiency, 2) low carbon technologies and 3) better connected European grid ETS + binding national targets for the non-ETS sector the main tools Climate targets for 2030 and 2040 in line with the 2050 target – important to decide on the ambition NOW!

5. European Agenda for 2012 Adopt the Energy Efficiency Directive Adopt council conclusions on energy, transportation, climate and resources Roadmaps 2050 with a 2030 and 2040 GHG target to guide investments to decarbonize the power sector before 2050 Adopt energy tax directive based on CO 2 -emissions and targeted for non-ETS sector Adopt Horizon 2020 programme 5,8 bn euro for energy R&D Adopt conclusions on energy, transportation, climate and resources Roadmaps 2050 Strengthen the functioning of the internal electricity market Develop a coherent view on the electricity market analyze the effects of different RES, energy efficiency, security of supply etc. targets and national interests on the electricity market Ensure a framework for energy use of biomass

6. Key messages Substantial investments in new emission free generation, leading to a power surplus in 2020, underlining the need for more transmission The Nordic strategy to meeting climate targets build on a European ETS and binding targets in non-ETS sectors The European agenda for 2012 is all about adopting key legislative proposals and roadmaps, while strengthening the internal electricity market