Finland's Fortum accelerates coal plant closures

Finnish energy company Fortum sign is seen at their headquarters in Espoo, Finland July 17, 2018. REUTERS/Ints Kalnins
  • Posts 83% drop in Q2 comparable operating profit
  • CEO says schedule for coal exit accelerated

HELSINKI, Aug 17 (Reuters) - Finnish energy company Fortum (FORTUM.HE) has accelerated the closure of almost 40% of its coal-fired generation capacity globally, it said on Tuesday, as many countries look to cut coal usage to curb climate change.

Chief Executive Markus Rauramo told Reuters shifting to renewable energy is not easy, as demand for electricity grows and a significant proportion of it has traditionally been produced from burning coal.

He however repeated Uniper was ready to start negotiations with Germany if it wants to revise its coal-exit schedule and offer Uniper compensation for closing the Datteln 4 plant which opened only last year and is set to run until 2038.

Majority state-owned Fortum announced a new strategy in December, saying it aimed to divest its retail businesses and become carbon neutral by 2050. The deadline prompted several environmental organisations to urge the Finnish government to push for an even faster exit from coal.

A spokesperson said Uniper's coal-fired plant in Berezovskaya, Russia, is currently its only site that has no published exit deadline.

Reuters reported in May that Uniper has held talks with Russia's InterRAO (IRAO.MM) on the sale of its coal-powered plants in Russia, citing sources. read more

Fortum also on Tuesday posted a sharp drop in second-quarter operating profit, roughly in line with expectations after biggest unit Uniper was hit by rising costs.

The group's April-June comparable operating profit dropped to 35 million euros ($41 million) from 203 million a year earlier, slightly above the 23 million euro mean estimate from eight analysts in a company-provided poll.

Shares in Fortum, the largest Finnish company by revenue, were 0.2% up in afternoon trade.

($1 = 0.8497 euros)

(This story corrects paragraph 3 to make clear Uniper, not Fortum, is negotiating in Germany)

Reporting by Essi Lehto and Tarmo Virki; Editing by David Evans and David Holmes

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