OSLO Feb 13 Norway's Statkraft plans to invest around $2 billion on upgrading its Norwegian and Swedish hydropower plants over the next five years to keep the ageing plants in operation, the company said in its fourth-quarter report.
Hydropower accounted for 95 percent of state-owned company's total electricity output of 55.9 terawatt-hours (TWh) in 2013, which was down from a record 60 TWh the previous year.
"Within Nordic hydropower, Statkraft is carrying out many major rehabilitation projects, and is planning investments of 12 billion crowns ($2 billion) to upgrade Norwegian and Swedish hydropower plants from 2014 to 2018," the state-owned company said on Thursday.
The upgrades could increase capacity only marginally, while the main goal is to keep production steady for years to come, a spokesman for the company said.
Slightly more than 90 percent of Statkraft's total 2013 output came from the Nordic region, including Norway.
The third-largest power generator in the Nordics also said it planned to make a final investment decision on a proposed British project, the Dudgeon offshore wind farm, in the second half of 2014.
The project, 30 percent owned by Statkraft and 70 percent by Statoil, off the coast of North Norfolk could have a total installed capacity of 400 megawatts (MW).
Statkraft took over operational control of the nearby 317 MW Sheringham Shoal wind power park, which it owns half and half with Statoil, from Jan. 1.
The Norwegian power producer said its total wind power output nearly doubled to 1.4 TWh in 2013 from 0.8 TWh the previous year.
While Statkraft prides itself on being the biggest producer of renewable energy in Europe, it said on Wednesday it would keep its three remaining gas-fired plants in Germany despite a weak power market.
The firm said it was paying some 20 million euros ($27.4 million) a year to keep them open.
In the last two years, Statkraft has already closed the 430 MW Emden and the 510 MW Robert Frank gas-fired plants due to their low competitiveness.
Output from its gas-fired power plants fell to 1.1 TWh in 2013 from 1.5 TWh the previous year, Statkraft said in the report.
Meanwhile, market conditions are expected to remain challenging this year, with Nordic power prices seen "somewhat lower" than in 2013, when it averaged 38.1 euros a megawatt-hour, the company said.