Fortum Oyj

Quarterly Report • May 12, 2022

Contents

Operating results down – Fortum prepares for a controlled exit from Russia and takes action to provide
security of supply in Europe	3
Fortum's President and CEO Markus Rauramo's comments	4
Fortum in Russia	5
Financial results	7
Financial position and cash flow	9
Segment reviews	11
Capital expenditures, divestments, and investments in shares	19
Operating and regulatory environment	20
Key drivers and risks	25
Outlook	27
Sustainability	28
Legal actions	28
Shares and share capital	31
Group personnel	31
Annual General Meeting 2022	31
Events after the reporting period	33
Dividend payment	33
Further information	33

Tables to the Interim Report

Condensed consolidated income statement	34
Condensed consolidated statement of comprehensive income	35
Condensed consolidated balance sheet	36
Condensed consolidated statement of changes in total equity	37
Condensed consolidated cash flow statement	38
Change in financial net debt	40
Capital risk management	40
Key figures	41
Notes to the condensed consolidated interim financial statements	42
Definitions and reconciliations of key figures	68
Market conditions and achieved power prices	73
Fortum's production and sales volumes	74

Figures in brackets refer to the comparison period, i.e. the same period last year, unless otherwise stated.

Operating results down − Fortum prepares for a controlled exit from Russia and takes action to provide security of supply in Europe

January–March 2022

• Comparable EBITDA was EUR -104 (1,479) million due to the negative Uniper result
• Comparable operating profit was EUR -438 (1,171) million due to the negative Uniper result
• Operating profit was EUR -2,416 (1,345) million, mainly impacted by changes in fair values of non-hedgeaccounted derivatives and impairments
• Comparable earnings per share were EUR -0.11 (0.94)
• Earnings per share were EUR -2.50 (1.23)
• Impairments of approximately EUR 2.1 billion recorded pre-tax related to the Group's Russian operations including Nord Stream 2
• Cash flow from operating activities totalled EUR -1,529 (831) million due to negative change in working capital in the Uniper segment
• On 22 March, Fortum signed an agreement to sell its 50% ownership in Fortum Oslo Varme AS for approximately EUR 1 billion. Closing expected during the second quarter of 2022.

Summary of outlook

• The Generation segment's Nordic generation hedges: approximately 80% at EUR 35 per MWh for the remainder of 2022, and approximately 55% at EUR 33 per MWh for 2023
• The Uniper segment's Nordic generation hedges: approximately 75% at EUR 26 per MWh for the remainder of 2022, approximately 50% at EUR 31 per MWh for 2023 and approximately 25% at EUR 30 per MWh for 2024*
• Capital expenditure, including maintenance but excluding acquisitions, is expected to be approximately EUR 1,500 million in 2022

* As of the first quarter of 2022, Uniper has changed the reporting on its hedges. See Uniper's quarterly statement Q1 2022 materials for further details.

Key figures

EUR million	I/2022	I/2021	2021	LTM
Reported
Sales	43,623	21,493	112,400	134,530
Operating profit	-2,416	1,345	-588	-4,349
Share of profit/loss of associates and joint ventures	-190	80	192	-78
Net profit	-2,833	1,310	-114	-4,256
Net profit (after non-controlling interests)	-2,222	1,092	739	-2,575
Earnings per share, EUR	-2.50	1.23	0.83	-2.90
Net cash from operating activities	-1,529	831	4,970	2,610
EUR million	I/2022	I/2021	2021	LTM
Comparable
EBITDA	-104	1,479	3,817	2,234
Operating profit	-438	1,171	2,536	927
Share of profit/loss of associates and joint ventures	26	67	154	113
Net profit (after non-controlling interests)	-99	837	1,778	842
Earnings per share, EUR	-0.11	0.94	2.00	0.95
		31 Mar	31 Dec
EUR million		2022	2021	LTM
Financial net debt (at period-end)		2,235	789
Adjusted net debt (at period-end)		4,454	3,227
Financial net debt/comparable EBITDA			0.2	1.0

Fortum's President and CEO Markus Rauramo:

"After a year of extraordinary and volatile market conditions in 2021, developments in the early part of 2022 have been even more dramatic as a consequence of the Russia-Ukraine war. Together with its allies, the EU has responded in a coordinated and decisive manner to support Ukraine and to isolate Russia with broad sanctions, covering also energy. This has caused an upheaval in all commodity markets, with the European front-month gas prices spiking above 200 euro per megawatt hour over possible supply disruptions. Furthermore, high gas prices have clearly increased both demand and prices of other commodities; including oil, coal and power. With markets, political developments and additional sanctions continuously in flux, this has created unprecedented short term challenges for the entire sector in Europe since the war began, as well as far-reaching implications for the longer-term energy system and transition. The resulting industry crisis mode also significantly affects us at Fortum.

Fortum is managing this extreme market volatility and increased uncertainties on the commodity markets by focusing on cash flow optimisation and securing of sufficient liquidity headroom. At the end of the first quarter, we had almost EUR 6 billion of undrawn committed short-term and long-term financing. We will continue to strive for a solid investment-grade rating of at least BBB to preserve financial flexibility. In March, S&P Global Ratings placed Fortum and Uniper on Negative Credit Watch while Fitch reaffirmed our long-term rating BBB with a stable outlook.

Over the recent months, we have also worked hard to reduce the Group's exposure to Russia and to support the European governments in securing and diversifying alternative energy supplies. In addition to the previously announced investment and financing freeze in our Russian subsidiaries, we have decided to pursue a controlled exit from the Russian market. As the preferred path, this decision includes a potential divestment of Fortum's Russian operations. The divestment process for Uniper's Russian subsidiary Unipro is also expected to be resumed as soon as possible. These processes may take some time to conclude and are subject to regulatory approvals. Irrespectively, we have decided to stop using the Fortum brand in Russia.

It is very clear that there is a need to decrease Europe's dependency on Russian energy and move towards a more independent energy system in Europe. Especially Germany is currently highly dependent on the imports of natural gas and as the country's government has repeatedly stated that withdrawing from Russian gas is not immediately possible. We are working on ways to reduce, replace or transform the use and supply of natural gas both in the short

and mid-term. Uniper is in close consultation with the German government and has already taken a series of actions to secure alternative energy supplies. As one example, Uniper contracted additional capacity to land LNG at the Gate terminal in Rotterdam in The Netherlands. We have also agreed to build and operate a floating LNG import terminal in Wilhelmshaven in Germany for the German government. In Finland, the Finnish Fennovoima's Board of Directors decided to terminate the EPC-contract with the Russian RAOS Project on the Fennovoima Hanhikivi 1 nuclear power project at the end of April due to severe delays and unability to deliver the project. Fortum is an indirect shareholder (6.6%) in the project.

These examples demonstrate that a lot is being done by Europe's sector leaders, all of whom want to help address Europe's current energy crisis and support a more independent energy system for Europe. But none of us can do it on our own. These unprecedented times call for an unprecedented level of cooperation – between country governments, between governments and companies. The energy sector needs transparency, guidance and visibility from political bodies on the desired way forward. Clarity is paramount for the sector to make the substantial investments required and to focus on the most promising solutions. While some challenges are being resolved for the short-term at lightning speed, as outlined above, others will take more time and can't be rushed.

In the first quarter, our comparable operating profit turned into a loss of EUR 438 million. The result was mainly weighed down by a phasing effect in the Uniper segment's gas midstream business due to gas storage optimisation that shifted approximately EUR 750 million of profits into coming quarters of the year. However, despite the first quarter loss, Uniper reiterated its full-year 2022 guidance. This quarter's highlight was the Generation segment's good performance that was mainly driven by higher achieved power price following very successful physical optimisation and higher spot prices. City Solutions' result decreased on higher fuel and CO₂ emission allowance prices, lower heat volumes in Finland as well as on structural changes. Consumer Solutions was slightly down mainly due to a reduction in the number of customers and slightly higher cost. While production was running normally in Russia, the Russia segment's result was impacted by weaker rouble and the ending of CSA payments for one unit while the previous year was positively affected by gains from the sale of a solar power project. In our first quarter results we recorded impairments of approximately EUR 2.1 billion related to the Group's Russian assets.

I can't stress enough that these times are very challenging for the European energy sector – and for Fortum. The urgency to accelerate the transition to CO₂-free and clean energy is clearer than ever before. Our strategy is designed to secure a fast and reliable transition to a carbon neutral economy. We will therefore continue to push forward with this execution. In doing so, I want to thank all our employees for their resilience, unwavering commitment and hard work over the past few months."

Fortum in Russia

Fortum is closely monitoring the developments caused by Russia's attack on Ukraine, which has increased the geopolitical tensions, uncertainties and risks in the operating environment. The company is complying with all applicable laws and regulations, including sanctions, and preparing for various scenarios. Fortum and Uniper are in continuous discussions with the Finnish and German Governments about what can be done to secure the energy supply and how the dependence on Russian energy imports will be reduced. Further information on risks is also in the section 'Key drivers and risks' of the interim report.

Exiting operations and investments in Russia

As announced in early March, Fortum has stopped all new investment projects in Russia and is not providing any new financing to its Russian subsidiaries. Likewise, Uniper will also not make any new investments in Russia. Due to existing sanctions imposed by Russia, the Group's Russian operations are subject to significant foreign exchange transfer restrictions, which limits the ability to transfer funds including potential dividend distributions out of Russia.

Fortum is preparing a controlled exit from the Russian market, with potential divestments of its Russian operations as the preferred path. Fortum's subsidiary Uniper has also been preparing a possible divestment of its separately listed subsidiary Unipro (ownership 83.7%). Due to the circumstances in Russia, the divestment of Unipro has been put on hold for the time being, but will be resumed as soon as possible. These processes might take some time and are subject to regulatory approvals.

Fuel supply and sourcing from Russia

In order to secure fuel supplies for its power plants, Fortum and Uniper have taken various measures. In Finland, Fortum does not buy coal, pellets or biomass from Russia for its power plants. However, Fortum buys nuclear fuel for its Loviisa nuclear power plant in Finland from Russian TVEL (part of Rosatom) and it is not possible to quickly change suppliers, e.g. due to required certification and permitting processes. The current supply contract is valid until the end of current operating licences in 2027 (Loviisa 1) and in 2030 (Loviisa 2). At the beginning of March, Fortum announced its decision for a lifetime extension of the Loviisa nuclear power plant. As part of the application for the operating licence, new tendering processes including nuclear fuel, will be initiated according to Fortum's procurement procedures. Uniper is actively working to replace coal procurement from Russia. Uniper has not concluded any new contracts for Russian coal since the start of the war and will terminate existing contracts by the end of August 2022.

In Finland, Fortum stopped its small-scale commercial electricity import from Russia to Finland via the 110 kV Svetogorsk-Imatra line. The commissioning and ongoing ramp up of the Olkiluoto 3 nuclear power plant will reduce overall dependence on imported electricity to Finland. Olkiluoto is operated by TVO (Teollisuuden Voima Oyj) in which Fortum has a minority interest of 26%. Fuel for Olkiluoto is sourced from Western suppliers.

Uniper's gas business and imports from Russia

Fortum's subsidiary Uniper is among the largest importers of natural gas to Europe and plays an essential role in providing security of supply especially in Germany. Today, Germany is more than 90% dependent on natural gas imports. In 2021, Germany imported just under 90 bcm of natural gas and approximately 55% of that amount came from Russia. Uniper's gas midstream business comprises a portfolio of around 370 TWh of long-term gas supply contracts. Of these, about 200 TWh originate from Russia.

Uniper will not enter into any new long-term supply contracts for natural gas with its counterparty Gazprom in Russia. Gas imports from Russia to Central Europe cannot be easily replaced at present, but Uniper is working to diversify natural gas imports, with the goal to move to clean gases overtime. In the short term, Uniper is increasing LNG imports to Europe and is now involved in the building and operating of a new LNG import terminal project in Wilhelmshaven, Germany. Fortum and Uniper are in continuous discussions with the respective European governments on how the companies can support the securing of the energy supply to their European customers.

In the event of a limited and short-term curtailment of gas flows from Russia, Uniper is expected to be able to use its flexible assets, including its gas storage facilities, in such a way that offsets the outage. In contrast, significant interruptions of gas flows would jeopardise the stability of the German gas system and would most likely lead to a declaration of emergency by the German Government. Within this legal framework, the national authority "Bundesnetzagentur" would become the "federal load dispatcher", effectively taking control of the system and issuing instructions to market participants on supply and demand to balance the system in a timely manner. Uniper expects that such measures and events would supersede existing contractual arrangements. For further details on this topic, please see Uniper's quarterly statements Q1 2022.

Uniper is fulfiling its contractual obligations under its Russian gas long-term contracts. With regard to the implementation of the ruble decree, Uniper is in close alignment with the German Government and Gazprom. Uniper has been and will continue to be fully compliant with sanctions and will continue to pay for its gas in euros. As of today and depending on the outcome of the ongoing discussions, it is deemed possible that a solution could be found and implemented that would be compliant with European sanctions.

Fortum's operations and assets in Russia

Fortum and Uniper have 12 power plants in Russia. Fortum's Russia segment comprises its subsidiary PAO Fortum including shares in joint ventures and its shareholding in PAO TGC-1 (ownership of appr. 29%). Uniper's Russia business is operated through its subsidiary Unipro. The Group has a combined power generation capacity of 15.5 gigawatts (GW) and heat production capacity of 10.2 GW. In 2021, the Group generated 71.9 terawatt-hours (TWh) of electricity and produced 19.1 TWh of heat in Russia. Together with its joint venture partners, Fortum has built over 1 GW of wind and solar power in Russia. The Group has approximately 7,000 employees in Russia.

In its first-quarter 2022 results, following Russia's attack and the war in Ukraine and the consequential geopolitical tensions, uncertainties and risks, Fortum recorded pre-tax impairments of approximately EUR 2.1 billion related to the company's Russian operations. The impairments include approximately EUR 0.3 billion related to fixed assets and goodwill for Fortum's Russian division and approximately EUR 0.6 billion for fixed assets from Uniper's Russian

subsidiary Unipro. Further, impairments of approximately EUR 0.2 billion are related to Fortum's ownership in PAO TGC-1 and renewables joint ventures. Fortum and Uniper also recorded impairments of approximately 1.0 billion related to Uniper's outstanding loan receivable related to the Nord Stream 2 project company.

Financial results

Sales by segment

EUR million	I/2022	I/2021	2021	LTM
Generation	710	675	2,899	2,933
Russia	223	264	906	865
City Solutions	390	418	1,302	1,275
Consumer Solutions	1,168	661	2,622	3,129
Uniper	41,484	19,770	105,992	127,707
Other Operations	35	34	138	139
Netting of Nord Pool transactions	-448	-223	-1,128	-1,354
Eliminations	62	-107	-331	-163
Total	43,623	21,493	112,400	134,530

Comparable EBITDA by segment

EUR million	I/2022	I/2021	2021	LTM
Generation	330	315	1,299	1,314
Russia	92	134	404	361
City Solutions	90	132	317	275
Consumer Solutions	54	53	123	124
Uniper	-645	868	1,789	276
Other Operations	-25	-23	-114	-116
Total	-104	1,479	3,817	2,234

Comparable operating profit by segment

EUR million	I/2022	I/2021	2021	LTM
Generation	282	269	1,110	1,123
Russia	61	100	261	223
City Solutions	48	86	135	97
Consumer Solutions	35	36	52	51
Uniper	-833	711	1,120	-424
Other Operations	-32	-31	-142	-143
Total	-438	1,171	2,536	927

Operating profit by segment

EUR million	I/2022	I/2021	2021	LTM
Generation	299	318	1,054	1,035
Russia	-234	100	227	-107
City Solutions	36	86	2,671	2,622
Consumer Solutions	192	59	495	627
Uniper	-2,669	813	-4,901	-8,384
Other Operations	-39	-31	-134	-142
Total	-2,416	1,345	-588	-4,349

Comparable share of profit/loss of associates and joint ventures by segment

EUR million	I/2022	I/2021	2021	LTM
Generation	3	-5	11	18
Russia	13	22	62	52
City Solutions	4	39	42	7
Consumer Solutions	-	-	-	-
Uniper	9	11	39	36
Other Operations	-1	-1	0	-1
Total	26	67	154	113

Share of profit/loss of associates and joint ventures by segment

EUR million	I/2022	I/2021	2021	LTM
Generation	-31	8	36	-3
Russia	-159	22	62	-120
City Solutions	4	39	42	7
Consumer Solutions	-	-	-	-
Uniper	-2	11	51	38
Other Operations	-1	-1	0	-1
Total	-190	80	192	-78

January–March 2022

Sales were EUR 43,623 (21,493) million due to record high commodity prices.

Comparable operating profit was EUR -438 (1,171) million. The loss was mainly attributable to the Uniper segment's midstream gas business, in particular gas storage optimisation. Uniper reduced its anticipated gas storage withdrawals in the first quarter, which resulted in an earnings shift of approximately EUR 750 million from the first quarter into the remaining quarters of 2022. However, despite the first-quarter loss, Uniper reiterated its full-year 2022 guidance. The Uniper segment further contributed to the negative result with an intra-year CO2 emission rights phasing effect that shifted margins from the first quarter to the fourth quarter of the year and by the clearly lower achieved power price in the Nordics. Good performance in Fortum's Generation segment was mainly driven by the higher achieved power price due to successful physical optimisation and higher spot prices.

Operating profit for the period was impacted by EUR -1,978 (174) million of items affecting comparability, the majority of which is related to changes in fair values of non-hedge-accounted derivatives of EUR -1,107 (165) million almost entirely related to the Uniper segment. Items affecting comparability also include EUR 275 million of impairments related to fixed assets and goodwill for the Russia segment, and EUR 555 million of impairments for fixed assets from the Uniper segment's Russian subsidiary Unipro (Note 4 and 13).

Comparable share of profits of associates and joint ventures was EUR 26 (67) million (Note 12). In the first quarter of 2022, the share of profits of associates and joint ventures of EUR -190 million includes EUR 150 million of impairments related to Fortum's ownership in the Russian TGC-1 and EUR 22 million of impairments of the renewables joint ventures in Russia.

Finance costs – net amounted to EUR -956 (36) million. Comparable finance costs - net amounted to EUR 135 (19) million. The change in finance cost - net mainly relates to the EUR 1,003 million impairment of Uniper's financial loan receivable, including accrued interest, for the Nord Stream 2 pipeline project. The receivable was fully written down.

Profit before income taxes was EUR -3,561 (1,460) million. Comparable profit before income taxes was EUR -277 (1,257) million.

Income taxes for the period totalled EUR 728 (tax income) (-150) million. Comparable income taxes were EUR 74 (-260) million (Note 8).

Net profit was EUR -2,833 (1,310) million. Comparable net profit was EUR -99 (837) million after the deduction of adjusted non-controlling interest. Comparable net profit is adjusted for items affecting comparability, adjustments to share of profit of associates and joint ventures, net finance costs, and income tax expenses (Notes 4.2 and 24).

Earnings per share were EUR -2.50 (1.23) and comparable earnings per share were EUR -0.11 (0.94).

For further details, see Segment reviews.

Financial position and cash flow

Cash flow

In January−March, net cash from operating activities decreased by EUR 2,360 million to EUR -1,529 (831) million. The main reason for the negative cash flow was the negative change in working capital in the Uniper segment. Working capital was impacted by payments for CO2 allowances and gas related operational measures taken to improve liquidity in the fourth quarter of 2021. These measures had a reverse cash flow effect in the first quarter of 2022.

Net cash from investing activities was EUR 1,659 (-194) million. The main effect was related to change in margin receivables that was EUR 1,722 (16) million. Capital expenditure decreased by EUR 91 million to EUR 202 (293) million.

Cash flow before financing activities was EUR 130 (637) million.

Net cash from financing activities was EUR -1,287 (655) million. The net decrease in long-term liabilities was EUR 300 (increase 20) million, while the decrease in short-term liabilities was EUR 1,787 (increase 295) million, mainly related to repayments of commercial papers. The change in margin liabilities was EUR 875 (339) million. The net decrease in liquid funds was EUR -1,158 (increase 1,292) million (Note 15).

Assets

At the end of the first quarter, total assets amounted to EUR 206,425 (149,661 at the end of 2021) million. The increase from December 2021 was mainly related to the higher value of derivative financial instruments in the Uniper segment as a result of higher commodity prices. Liquid funds at the end of the first quarter of 2022 decreased and were EUR 6,419 (7,592 at the end of 2021) million.

Equity

Total equity amounted to EUR 8,762 (13,665 at the end of 2021) million. Equity attributable to owners of the parent company totalled EUR 8,036 (12,131 at the end of 2021) million. The change from December 2021 was mainly related to the net loss for the period of EUR 2,222 million, the EUR -691 million impact from fair valuation of cash flow hedges and the dividend of EUR 1,013 million. The dividend of EUR 1.14 euro per share was paid on 6 April 2022 and was recorded as a liability in the first-quarter interim financial statements.

Financing

Fortum has determinedly executed its strategy and taken measures, mainly divestments of non-core assets and businesses during the past years, to strengthen its balance sheet and secure its rating. With these actions, the Group has successfully lowered its financial net debt-to-comparable EBITDA ratio to a level clearly below the target level of <2 times. At the end of March, the ratio was 1.0 times (0.2).

Since the second half of 2021, the very volatile commodity markets with unprecedentedly high prices have resulted in significantly high margining requirements for European energy market participants. To manage this volatility and the high price levels, the Group has taken precautionary financing measures to secure its liquidity position and financial flexibility.

At the end of the first quarter, financial net debt was EUR 2,235 (789 at the end of 2021) million. Adjusted net debt was EUR 4,454 (3,227 at the end of 2021) million.

At the end of the first quarter, the Group's liquid funds totalled EUR 6,419 (7,592 at the end of 2021) million. Liquid funds include EUR 3,897 (2,966 at the end of 2021) million related to the Uniper segment.

In January 2022, Fortum repaid the drawn amount of EUR 500 million of its EUR 800 million revolving credit facility. In March 2022, Fortum repaid EUR 247 million of the nuclear waste fund loans totalling EUR 918 million after the repayment.

In the first quarter, Fortum's total interest-bearing loans decreased by EUR 2,306 million to EUR 13,838 million. Current loans, including the EUR 2,866 million current portion of long-term loans, amounted to EUR 7,727 million. Short-term loans decreased by EUR 1,798 million to EUR 4,860 million at the end of March from EUR 6,658 million at the end of 2021. The use of commercial papers decreased by EUR 1,274 million to EUR 1,855 million from EUR 3,129 million at the end of 2021 (Note 15).

In January 2022, Uniper signed a EUR 2,000 million revolving credit facility maturing in April 2022 with the German state-owned KfW Bank and Fortum signed a EUR 3,000 million revolving credit facility maturing in April 2022, with an extension option of three months. In March 2022, Uniper extended the EUR 2,000 million facility to mature in April 2023. Fortum extended the maturity of its EUR 3,000 million revolving credit facility to July 2022. The EUR 1,750 million revolving credit facility maturing in June 2023 and Uniper's revolving credit facility of EUR 1,800 million maturing in September 2025, were both fully in use at the end of March.

At the end of the first quarter, Fortum had undrawn committed credit facilities amounting to EUR 5,800 million. The undrawn facilities include committed revolving facilities of EUR 3,800 million, of which EUR 3,000 million matures in July 2022 and EUR 800 million matures in December 2022 (with a one-year extension option). Uniper's committed revolving credit facility of EUR 2,000 million matures in April 2023. In addition to the revolving credit facilities, Fortum has EUR 100 million committed overdraft limits that are valid until further notice.

On 14 March 2022, S&P Global Ratings (S&P) placed Fortum's and its subsidiary Uniper's long-term BBB ratings on CreditWatch Negative. Since 2018, Fortum and Uniper have had the investment-grade rating of BBB from S&P.

On 17 March 2022, Fitch affirmed its long-term rating for Fortum to BBB, with a stable outlook.

Segment reviews

Generation

Generation is responsible for Nordic power generation. The segment comprises CO2-free nuclear, hydro, and wind power generation, as well as power portfolio optimisation, trading, market intelligence, thermal power for the capacity reserve, and global nuclear services. The segment does not include the Nordic hydro and nuclear power generation or the trading activities of Uniper. As of February 2022, Generation is responsible for Uniper's hydro asset management and dispatch activities in Sweden. The segment includes Generation's proportionate share of OKG (Note 3).

EUR million	I/2022	I/2021	2021	LTM
Reported
Sales	710	675	2,899	2,933
- power sales	700	627	2,690	2,763
of which Nordic outright power sales*	497	468	1,937	1,966
- other sales	10	48	209	170
Operating profit	299	318	1,054	1,035
Share of profit/loss of associates and joint ventures**	-31	8	36	-3
Capital expenditure and gross investments in shares	34	27	175	182
Number of employees	1,262	1,130	1,116
EUR million	I/2022	I/2021	2021	LTM
Comparable
EBITDA	330	315	1,299	1,314
Operating profit	282	269	1,110	1,123
Share of profit/loss of associates and joint ventures**	3	-5	11	18
Return on net assets, %			18.0	18.3
Net assets (at period-end)	6,246	6,135	6,336

* Nordic outright power sales includes hydro and nuclear generation. It does not include thermal generation, minorities, customer business, or other purchases. ** Power plants are often built jointly with other power producers, and owners purchase power at cost. The share of profit/loss is mainly IFRS adjustments (e.g. accounting for nuclear-related assets and liabilities) and depreciations on fair value adjustments from historical acquisitions (Note 18 in the Consolidated Financial Statements 2021).

Power generation by source

TWh	I/2022	I/2021	2021	LTM
Hydropower, Nordic	5.4	6.7	23.3	22.0
Nuclear power, Nordic	6.3	6.3	23.5	23.5
Thermal power, Nordic	-	0.0	0.0	-
Total	11.7	13.0	46.8	45.5

Nordic sales volumes

TWh	I/2022	I/2021	2021	LTM
Nordic sales volume	13.7	15.0	54.1	52.8
of which Nordic outright power sales volume*	11.3	12.6	45.3	44.0

* The Nordic outright power sales volume includes hydro and nuclear generation. It does not include thermal generation, minorities, customer business, or other purchases.

Achieved power price

EUR/MWh	I/2022	I/2021	2021	LTM
Generation's Nordic achieved power price*	44.1	37.2	42.8	44.7

* Generation's Nordic achieved power price includes hydro and nuclear generation. It does not include thermal generation, minorities, customer business, or other purchases.

January–March 2022

The Generation segment's total power generation in the Nordic countries decreased due to lower hydropower volumes. This was caused by lower inflow to the segment's power generation areas and lower reservoir levels at the beginning of the quarter. The operational performance for nuclear generation was at the same good level as in 2021. CO2-free generation accounted for 100% of the total power generation. In March, TVO's third Olkiluoto nuclear power plant unit (OL3) started electricity production to the grid. During the next four-month test period phase, output volumes will be gradually increased.

The achieved power price in the Generation segment increased by EUR 6.9 per MWh, up by 19%. The achieved power price increased mainly due to the very successful physical optimisation and higher spot prices. While the spot power price increased by 81% in the Generation segment's power generation areas, the positive result effect of the higher achieved power price was dampened by the fairly high hedge levels and a hedge price below the level of the spot price. The achieved power price was also negatively impacted by the record-high price difference in Sweden between high system price and low SE2-area spot price (Sundsvall). Due to low liquidity in SE2 area price products, the hedge level in SE2 area was lower than the system price hedges and SE3 (Stockholm) and FI (Finland) area price hedges and consequently, negatively affected the achieved power price.

Comparable operating profit increased by 5%. The increase was mainly related to the higher achieved power price partly offset by lower hydro volumes. Comparable operating profit included EUR 8 (1) million from the consolidation of the Generation segment's proportionate share of OKG (Note 3).

Operating profit was affected by EUR 17 (49) million of items affecting comparability, mainly related to the fair value change of non-hedge-accounted derivatives (Note 3).

Comparable share of profits of associates and joint ventures totalled EUR 3 (-5) million (Notes 3 and 12).

On 1 February 2022, the Fortum and Uniper joint organisation for the Nordic hydro and physical trading operations was launched as part of the three strategic cooperation areas to ensure focused and effective implementation of the Group strategy. Fortum took responsibility for Uniper's hydropower asset management in Sweden as well as physical trading optimisation and dispatch activities in the Nordics. The ownership of Uniper's hydropower assets stays with Uniper. The new organisation manages the third largest CO₂-free power portfolio in Europe and consists of some 400 employees.

On 3 March 2022, Fortum announced that it had decided to apply for a new operating licence for both units at the nuclear power plant in Loviisa, Finland, until the end of 2050. If approved, the plant is expected to generate up to 170 terawatt-hours of CO2-free electricity over the course of the lifetime extension. Investments related to the continuing of operations and lifetime extension will amount to an estimated one billion euros until 2050. On 18 March 2022, Fortum submitted the Loviisa nuclear power plant operating licence application to the Finnish Government. On 12 March 2022, electricity generation of TVO's third Olkiluoto nuclear power plant unit in Finland started. In April, TVO announced that the start of regular electricity generation was postponed from July to September 2022. The total capacity of the plant is 1,600 MW. Once regular electricity production has started, OL3 will produce approximately 14% of Finland's total electricity consumption (Note 16).

Russia

The Russia segment comprises power and heat generation and sales in Russia. The segment includes Fortum's fully owned power plants, its joint ventures for renewable power generation and joint ventures for power and heat sales, as well as Fortum's more than 29% holding in TGC-1. These joint ventures and the associated company are accounted for using the equity method. The segment does not include Uniper's Russian subsidiary Unipro.

EUR million	I/2022	I/2021	2021	LTM
Reported
Sales	223	264	906	865
- power sales	177	207	761	732
- heat sales	43	56	137	123
- other sales	3	1	8	10
Operating profit	-234	100	227	-107
Share of profit/loss of associates and joint ventures	-159	22	62	-120
Capital expenditure and gross investments in shares	11	7	83	87
Number of employees	2,744	2,960	2,627
EUR million	I/2022	I/2021	2021	LTM
Comparable
EBITDA	92	134	404	361
Operating profit	61	100	261	223
Share of profit/loss of associates and joint ventures	13	22	62	52
Return on net assets, %			12.9	11.3
Net assets (at period-end)	1,970	2,517	2,508

Power generation and heat production for the Russia segment

TWh	I/2022	I/2021	2021	LTM
Russian power generation	8.3	8.4	28.6	28.5
Russian heat production	6.2	7.5	17.1	15.8

Prices for the Russia segment

	I/2022	I/2021	2021	LTM
Average capacity price for CCS and other, tRUB/MW/month*
**	209	182	170	178
Average capacity price for CSA, tRUB/MW/month**	1,217	1,289	1,174	1,152
Average capacity price, tRUB/MW/month	536	636	584	559
Achieved power price for the Russia segment, RUB/MWh	1,913	1,892	2,018	2,027
Achieved power price for the Russia segment, EUR/MWh***	19.3	21.1	23.2	22.7

* Including capacity receiving payments under "forced mode status", regulated tariffs, and bilateral agreements.

** Capacity prices paid for the capacity volumes, excluding unplanned outages, repairs, and own consumption.

*** Translated using the average exchange rate.

January–March 2022

Power generation volumes decreased by 1%. The negative effect of the divestment of the Argayash coal-fired combined heat and power plant (CHP) in the third quarter of 2021 was partially offset by the higher generation of other power plants following higher electricity demand. Heat production volumes decreased by 17% due to the Argayash CHP plant divestment and warmer weather.

Sales decreased by 16%, or EUR 41 million, due to a weaker Russian rouble, expiry of Capacity Supply Agreement (CSA) payments of the Nyagan 1 production unit, the divestment of the Argayash CHP plant and lower heat sales as a consequence of warmer weather. This impact was partly offset by higher power prices. The effect of the change in the Russian rouble exchange rate was EUR -24 million.

Comparable operating profit decreased by 39%, or EUR 39 million. The negative effect from the CSA expiry for Nyagan 1, the EUR -6 million effect of the change in the Russian rouble exchange rate and the lower heat volumes was partly offset by higher power prices. The comparison period includes a EUR 17 million positive effect of the sale of the 116-MW CSA-backed solar power project to the Fortum-RDIF joint venture.

Comparable share of profits of associates and joint ventures totalled EUR 13 (22) million, including the share of profits of the joint ventures for heat distribution of EUR 8 (7) million, the share of profits of EUR 5 (6) million from the joint ventures for renewables power generation and the share of profits of EUR 0 (8) million from TGC-1 (Notes 3 and 12).

On 18 January 2022, Fortum announced that a 1.3 GW portfolio of wind projects is being transferred to a new joint venture. Due to the current geopolitical circumstances, Fortum is looking into revisiting the structure.

As announced on 3 May 2022, following Russia's attack and the war in Ukraine and the consequential geopolitical tensions, uncertainties and risks, Fortum is recording pre-tax impairments related to the company's Russian operations in its first-quarter 2022 results. The impairments include approximately EUR 0.3 billion related to fixed assets and goodwill for Fortum's Russia segment. Further, impairments also include approximately EUR 0.2 billion related to Fortum's ownership in TGC-1 and renewables joint ventures.

City Solutions

City Solutions is responsible for sustainable solutions for urban areas. The segment comprises heating, cooling, waste-to-energy, and other circular economy solutions, as well as solar power generation, services, and development of new biomass-based businesses. The business operations are located in the Nordics, Poland, and India. The segment does not include the operations of Fortum's subsidiary Uniper.

EUR million	I/2022	I/2021	2021	LTM
Reported
Sales	390	418	1,302	1,275
- heat sales	230	247	612	595
- power sales	50	60	205	194
- waste treatment sales*	61	62	250	249
- other sales**	50	49	236	237
Operating profit	36	86	2,671	2,622
Share of profit/loss of associates and joint ventures	4	39	42	7
Capital expenditure and gross investments in shares	25	48	162	140
Number of employees	1,751	2,094	1,766
EUR million	I/2022	I/2021	2021	LTM
Comparable
EBITDA	90	132	317	275
Operating profit	48	86	135	97
Share of profit/loss of associates and joint ventures	4	39	42	7
Return on net assets, %			6.1	4.1
Net assets (at period-end)	1,679	3,305	2,456

* Waste treatment sales comprise gate fees and environmental construction services.

** Other sales mainly comprise operation, maintenance, and other services, the sale of recycled products, as well as fuel sales.

Heat sales by country

TWh	I/2022	I/2021	2021	LTM
Finland	1.1	1.2	3.1	3.0
Poland	1.5	1.6	3.8	3.7
Norway	0.7	0.8	1.8	1.7
Other countries	0.1	0.8	1.3	0.6
Total	3.4	4.4	10.0	9.0

Power sales by country

TWh	I/2022	I/2021	2021	LTM
Finland	0.3	0.7	1.3	0.9
Poland	0.2	0.2	0.7	0.7
Other countries	0.1	0.4	1.3	1.0
Total	0.6	1.3	3.3	2.6

January–March 2022

Heat sales volumes decreased by 23% due to the divestment of the Baltic district heating business and warmer weather conditions. The power sales volumes decreased by 54%, mainly due to higher fossil fuel and CO2 emission allowances prices and structural changes following the divestment of the Baltic district heating business.

Comparable operating profit decreased by 44%, mainly as a result of clearly higher fuel and CO2 emission allowance prices as well as lower heat volumes due to warmer weather, partially offset by higher power prices. Comparable operating profit was negatively affected also by structural changes from the divestments of the Baltic district heating business and 250-MW Pavagada II and the 250-MW Rajasthan solar plants in India.

Operating profit was affected by EUR -12 (-1) million of items affecting comparability, mainly related to the fair value change of non-hedge-accounted derivatives (Note 3).

Comparable share of profits of associates and joint ventures totalled EUR 4 (39) million. The comparison period includes EUR 34 million of share of profits from Stockholm Exergi. Fortum's 50% ownership was divested in September 2021 (Notes 3 and 12).

On 4 February 2022, Fortum announced that it had won the right from Solar Energy Corporation of India (SECI) to build two solar power plants with a total capacity of 600 MW in Karnataka, India. On 16 March 2022, Fortum participated in another solar auction in India and won the right from Gujarat Urja Vikas Nigam Limited (GUVNL) to build a 200-MW solar plant in Gujarat. These projects are planned to be developed together with a partner and are expected to be commissioned by 2024.

On 3 March 2022, Fortum announced that it decided to discontinue the strategic assessment of its Polish district heating business and will continue to develop the business as part of the Group. Moreover, Fortum will evaluate alternatives for further decarbonisation of these assets in line with its target to be carbon neutral in its European power and heat generation by 2035. At the end of 2021, Fortum's coal-based capacity in Poland was 0.1 GW.

On 17 March 2022, Fortum and Microsoft announced the world's largest collaboration to heat homes, services and businesses with sustainable waste heat from the new data centre in the Helsinki metropolitan area in Finland. The concept utilises Fortum's existing district heating infrastructure, the second largest in Finland, for heat capture and distribution. Fortum's district heating infrastructure in this area includes about 900 km of underground pipes that transfer heat to approximately 250,000 users. Once operational, approximately 60% of the area's heating will be generated by climate-friendly waste heat.

On 22 March 2022, Fortum announced that it had signed an agreement to sell its 50% ownership in the district heating company Fortum Oslo Varme AS in Norway to an investor consortium comprising Hafslund Eco, Infranode and HitecVision. The total consideration for Fortum's share is approximately EUR 1 billion on a cash and debt-free basis, and, as part of the transaction, Fortum will deconsolidate a related EUR 210 million loan from the City of Oslo. Fortum expects to record a tax-exempt capital gain of approximately EUR 0.6 billion in the City Solutions segment's results in connection with the closing of the transaction. The transaction is subject to approval by the Oslo City Council (Bystyret), necessary regulatory approvals and fulfilment of the customary closing conditions. The transaction is expected to close during the second quarter of 2022.

Consumer Solutions

Consumer Solutions is responsible for the electricity and gas retail businesses in the Nordics, Poland and Spain, including related customer service and invoicing businesses. Fortum is the largest electricity retail business in the Nordics, with approximately 2.2 million customers across different brands in Finland, Sweden, Norway, Poland and Spain. The business provides electricity, as well as related value-added and digital services, mainly to retail customers.

EUR million	I/2022	I/2021	2021	LTM
Reported
Sales	1,168	661	2,622	3,129
- power sales	977	574	2,253	2,656
- gas sales	136	57	225	304
- other sales	55	31	144	168
Operating profit	192	59	495	627
Capital expenditure and gross investments in shares	16	11	68	72
Number of employees	1,185	1,020	1,176
EUR million	I/2022	I/2021	2021	LTM
Comparable
EBITDA	54	53	123	124
Operating profit	35	36	52	51
Net assets (at period-end)	1,001	721	1,125

Sales volumes

TWh	I/2022	I/2021	2021	LTM
Electricity	9.4	10.8	31.5	30.1
Gas*	1.7	2.0	6.0	5.7

* Not including wholesale volumes.

Number of customers

Thousands*	31 Mar 2022 31 Dec 2021
Electricity	2,110	2,120
E-mobility**	60	70
Gas	40	50
Total	2,210	2,230

* Rounded to the nearest 10,000.

** Measured as average monthly paying customers for the quarter.

January–March 2022

The electricity sales volumes decreased by 13%, mainly due to higher temperatures in the Nordics compared to clearly colder weather in the first quarter of 2021 and a slightly lower customer base. Total sales revenue increased by 77%, driven by significantly higher electricity and gas prices in the Nordics and Poland. The gas sales volumes decreased by 15%, as temperatures were higher than normal and the very high prices decreased demand and consumption in Poland.

Despite the challenging market conditions and prevailing uncertainties, Consumer Solutions' competitiveness continued to strengthen. Several digital services were launched such as a digital smart charging service. New enterprise contracts were signed and renewed with customers in the energy, food processing, real-estate, and retail industries.

Comparable operating profit decreased by 3%, mainly due to a reduction in the number of customers and slightly higher costs.

Operating profit was affected by EUR 157 (23) million of items affecting comparability, due to the fair value change of non-hedge-accounted derivatives (Note 3).

On 3 March 2022, Fortum announced that it had decided to discontinue the strategic review of the electricity retail business Consumer Solutions and will continue to develop the business as part of the Group.

Uniper

The Uniper segment comprises Fortum's majority ownership in Uniper, a subsidiary of Fortum. Uniper is a leading international energy company with activities in more than 40 countries. Its business is the secure provision of energy and related services. Its main activities include power generation in Europe and Russia as well as global energy trading and optimisation, which Uniper reports in three businesses – European Generation, Global Commodities, and Russian Power Generation – in its financial statements. Approximately 50% of the power generating capacity is gasbased, 25% coal-based, approximately 15% hydro- or nuclear-based, and 10% is other. The segment includes Uniper's proportionate share of OKG (Note 3).

EUR million	I/2022	I/2021	2021	LTM
Reported
Sales*	41,484	19,770	105,992	127,707
- power sales	9,615	5,784	28,365	32,197
of which Nordic outright power sales**	87	190	644	541
- heat sales	167	100	437	504
- gas sales	25,565	11,945	59,577	73,198
- other sales	6,137	1,941	17,612	21,809
Operating profit	-2,669	813	-4,901	-8,384
Share of profit/loss of associates and joint ventures	-2	11	51	38
Capital expenditure and gross investments in shares*	82	136	683	629
Number of employees	11,319	11,813	11,494
EUR million	I/2022	I/2021	2021	LTM
Comparable
EBITDA*	-645	868	1,789	276
Operating profit*	-833	711	1,120	-424
Share of profit/loss of associated and joint ventures	9	11	39	36
Return on net assets, %			16.5	-6.2
Net assets (at period-end)	3,662	8,240	4,971

* Uniper includes effects from its Russian business Unipro: Sales of EUR 283 million (I/2021: 240), Comparable EBITDA of EUR 114 million (I/2021: 76), Comparable operating profit of EUR 87 million (I/2021: 54) and Investments of EUR 9 million (I/2021: 25).

** Nordic outright power sales includes hydro and nuclear generation. It does not include thermal generation, minorities, customer business, or other purchases.

Power generation by source

TWh	I/2022	I/2021	2021	LTM
Hydropower, Nordics	2.4	2.3	8.1	8.2
Nuclear power, Nordics	3.4	3.6	12.9	12.7
Hydropower, Central Europe	1.1	1.0	4.9	5.0
Thermal power, Central Europe	11.5	10.7	40.9	41.7
Thermal power, Russia	14.1	12.3	43.2	45.0
Total	32.5	29.9	110.0	112.6

Nordic sales volumes

TWh	I/2022	I/2021	2021	LTM
Nordic sales volume	6.2	6.0	21.4	21.6
of which Nordic outright power sales volume*	5.9	6.0	21.0	20.9

* The Nordic outright power sales volume includes hydro and nuclear generation. It does not include thermal generation, minorities, customer business, or other purchases.

Prices for the Uniper segment

	I/2022	I/2021	2021	LTM
Uniper's Nordic achieved power price, EUR/MWh*	14.8	31.5	30.7	26.0
Average capacity price for Uniper CCS and other,
tRUB/MW/month** ***	202	169	160	167
Average capacity price for Uniper CSA, tRUB/MW/month***	2,245	1,163	1,488	1,702
Average capacity price for Uniper, tRUB/MW/month	365	251	293	321
Achieved power price for Uniper in Russia, RUB/MWh****	1,600	1,320	1,643	1,724
Achieved power price for Uniper in Russia, EUR/MWh****
*	16.1	14.7	18.9	19.3

* Uniper's Nordic achieved power price includes hydro and nuclear generation. It does not include thermal generation, minorities, customer business, or other purchases. ** Including capacity receiving payments under "forced mode status", regulated tariffs, and bilateral agreements.

*** Capacity prices paid for the capacity volumes, excluding unplanned outages, repairs, and own consumption.

**** Comparable prices changed from previously reported.

***** Translated using the average exchange rate.

January–March 2022

Power generation volumes were supported by slightly higher hydro volumes, better availability of the thermal fleet and the return to commercial operation of Berezovskaya 3. In contrast, the coal-fired plant Maasvlakte 3 had lower production due to regulatory restrictions, and nuclear volumes decreased following an outage at Oskarshamn 3.

Comparable operating profit for the Uniper segment amounted to EUR -833 (711) million. The decline in earnings was mainly attributable to the Global Commodities business, particularly gas storage optimisation in the gas midstream business. In view of the current market environment, Uniper reduced its anticipated gas storage withdrawals in the first quarter. This resulted in a EUR 750 million earnings shift from the first quarter to the remaining quarters of 2022. However, despite the first-quarter loss, Uniper reiterated its full-year 2022 guidance. The European Generation business was mainly affected by the sizeable intra-year CO2 emission rights phasing effect that shifted margins from the first quarter to the fourth quarter of 2022 and by the clearly lower achieved power price in the Nordics.

The result of the European Generation business was significantly below the previous year in particular due to the significant intra-year CO2 emission rights phasing effect that shifted margins from the first quarter to the fourth quarter 2022. In the Nordics, the low achieved power price due to the large discrepancy between the system price and the specific Swedish area price lead to significantly lower earnings contributions especially for Nordic hydropower. Lower income from the UK capacity market, higher procurement costs for hard coal, and the disposal of the Schkopau power station in the fourth quarter of 2021 also adversely affected the result. Regulated production restrictions (Urgenda) from 2022 onwards affecting the Maasvlakte power plant also contributed negatively.

The result of the Global Commodities business was significantly affected by gas storage optimisation in the gas midstream business. Uniper reduced its anticipated gas storage withdrawals in the first quarter, which resulted in a significant earnings shift from the first quarter to the remaining quarters of 2022. In the comparison period, the business recorded very strong results boosted by successful optimisation of its international portfolio due to unusually cold temperatures.

The comparable operating profit of the Russian Power Generation business (Unipro) was EUR 87 million, clearly above the result of EUR 54 million in the previous year. The commissioning of the Berezovskaya 3 power plant in the second quarter of 2021 and the corresponding attributable CSA payments and higher prices more than offset the expiry of CSA payments for two units at the Surgutskaya power plants and the negative rouble translation effects. For further financial details on Unipro, please see the footnote in the table on page 16.

Operating profit was affected by EUR -1,836 (102) million of items affecting comparability, mainly related to the fair value change of non-hedge-accounted derivatives and impairment charges (Note 3). The Uniper segment's future cash flows are largely hedged with forward sell contracts; however, as hedge accounting is not applied for most of the contracts, unrealised changes in the fair values of these derivative instruments are presented in items affecting comparability.

Comparable share of profits of associates and joint ventures totalled EUR 9 (11) million (Notes 3 and 12).

On 4 January 2022, Fortum announced that to manage any further market volatility and significant commodity price increases, Uniper took precautionary measures to secure additional liquidity and financial flexibility primarily for the winter season. Fortum provided Uniper with intra-group financing, comprising a shareholder loan and parent company

guarantee up to EUR 8 billion on arm's length terms. Uniper drew its existing EUR 1.8 billion revolving credit facility in full, and agreed with the German state-owned KfW-Bank on a revolving credit facility of up to EUR 2 billion. In March 2022, Uniper and KfW Bank agreed to continue the facility at an unchanged amount until April 30, 2023.

On 21 February 2022, Uniper announced that its Board of Management resolved to propose to its Annual General Meeting, taking place on 18 May 2022, a dividend payment of EUR 0.07 per share (2020: EUR 1.37) for the year 2021, corresponding to a total planned dividend of approximately EUR 26 million (2020: EUR 501 million). At the same time, Uniper also provided earnings guidance for 2022.

On 16 March 2022, Uniper announced that, starting from October 2022, it will increase the capacity rights at the Gate terminal B.V. in the Netherlands by 1 billion cubic meters annually for a three-year period.

On 26 April 2022, Uniper published a stock exchange release ('ad-hoc') with a negative profit warning related to its first-quarter 2022 results. The deviation is mainly attributable to the gas midstream business, in particular due to gas storage optimisation. This resulted in a EUR 750 million earnings shift from the first quarter to the remaining quarters of 2022. Despite the deviation in the first-quarter results, Uniper reiterated its full-year result guidance for 2022.

For further information, see Uniper's January−March 2022 results published on 3 May 2022.

Capital expenditures, divestments, and investments in shares

In the first quarter of 2022, capital expenditures and investments in shares totalled EUR 174 (251) million. Capital expenditures were EUR 162 (228) million (Notes 3 and 6).

Fortum expects to start, or has started, power and heat production capacity of new power plants and expects to upgrade its existing plants as follows:

	Type	Electricity capacity, MW	Heat capacity, MW	Supply starts/started	Latest announced
Generation
Pjelax-Böle and Kristinestad Norr, Finland	Wind	380		II/2024	22 Dec 2021
Uniper
Irsching 6, Germany*	Gas	300		I/2023	3 May 2022
Scholven, Germany	Gas	137	125	IV/2022	6 Feb 2020
Killingholme and Grain, UK	Grid stability			II/2022 and III/2022	3 May 2022

*held in reserve by the transmission system operator

Generation

On 3 March 2021, Fortum announced a substantial investment in dam safety in Sweden for an extensive rebuild of the over 100-year-old Forshuvud hydropower plant. Fortum is investing more than SEK 450 million (approximately EUR 44 million) during 2021–2025. This investment guarantees an extended lifetime for the power plant as a supplier of renewable electricity and balancing power for more weather-dependent types of power.

On 22 December 2021, Fortum announced the first investment by the joint team of Fortum and Uniper for wind and solar businesses in Europe. Fortum decided to construct the 380-MW Pjelax-Böle and Kristinestad Norr wind parks in Närpes and Kristinestad in Finland in partnership with the Finnish energy company Helen Ltd. Construction started in January 2022, and the wind parks are expected to be fully operational at the latest in the second quarter of 2024. Fortum has a 60% majority and Helen holds a 40% minority ownership in the project; the investment will be consolidated on Fortum's balance sheet. The total capital expenditure of the project is approximately EUR 360 million, of which Fortum's share is EUR 216 million.

Russia

Due to the current geopolitical situation, the ongoing Russia-Ukraine war and consequent supply chain constraints, Fortum is monitoring and assessing potential delays and the ability to complete ongoing projects. Fortum has stopped all new investment projects in Russia.

Fortum's Russian wind and solar portfolio (either in joint venture or direct ownership) comprises 1.2 GW of operational CSA-backed capacities, 0.3 GW of projects under construction and 1.9 GW of projects under development.

The investment decision for the 0.3 GW wind and solar capacities was made in 2021. The capacities under construction include wind parks of 250 MW in the Samara and Volgograd regions in Russia. The commissioning of the wind parks was originally planned to be in the fourth quarter of 2022. However, the timeline for completion is currently unclear. In addition, 38 MW of solar capacities in Kalmykia is planned to be commissioned in the third quarter of 2022.

The future of the 1.9 GW of wind capacities under development is undecided. As Fortum has stopped all new investment projects in Russia, these projects are not proceeding.

City Solutions

On 22 March 2022, Fortum announced that it had signed an agreement to sell its 50% ownership in the district heating company Fortum Oslo Varme AS in Norway to an investor consortium comprising Hafslund Eco, Infranode and HitecVision. The total consideration for Fortum's share is approximately EUR 1 billion on a cash and debt-free basis, and, as part of the transaction, Fortum will deconsolidate a related EUR 210 million loan from the City of Oslo. The consideration is based on a 100% enterprise value of approximately EUR 2 billion. Fortum expects to record a taxexempt capital gain of approximately EUR 0.6 billion in the City Solutions segment's results in connection with the closing of the transaction. The transaction is subject to approval by the Oslo City Council (Bystyret), necessary regulatory approvals and fulfilment of the customary closing conditions. The transaction is expected to close during the second quarter of 2022.

Uniper

In order to drive a reliable energy transition and in line with the Group strategy, Uniper actively supports transmission system operators (TSO) to balance the power grid and ensure security of supply by providing grid services in Germany.

In January 2019, Uniper announced that it will construct a new gas-fired power plant, Irsching 6 (300 MW) which will be available only for the TSO. It is expected to be commissioned in the first quarter of 2023.

In January 2020, Uniper announced it was awarded four six-year contracts to deliver innovative grid stability services in Killingholme and Grain in the UK. Power generation at these plants is expected to start during the second quarter and third quarter of 2022.

In July 2021, Uniper announced that it will convert its power plant in Scholven in Germany from coal-fired to gas-fired generation through the construction of a modern combined-cycle gas turbine (CCGT) for the supply of industrial customers in the region with significantly lower CO2 emissions. This is expected to be ready in the second half of 2022. In the next phase, the Scholven power plant will be converted from gas-fired to eventually fully using green hydrogen by 2030.

Operating and regulatory environment

European power markets

On 24 February 2022, Russia attacked Ukraine. Since then the global economy, commodity and raw material prices have been impacted by various sanctions or by the possibility of sanctions. During the first quarter of 2022, this was reflected in all-time high power prices in several countries. These record-high prices were reached despite a mild and windy winter both in the Nordics and in Continental Europe.

According to preliminary statistics, power consumption in the Nordic countries was 112 TWh (120) TWh during the first quarter of 2022. The lower power demand in the Nordics was mainly caused by milder weather, with temperatures two degrees above the long-term average compared to the first quarter of 2021.

In Central Western Europe (Germany, France, Austria, Switzerland, Belgium, and the Netherlands), power consumption in the first quarter of 2022 was 361 (375) TWh, according to preliminary statistics. Power demand was impacted by the mild winter in Continental Europe.

In the long term, electricity is expected to continue to gain a significantly higher share of total energy consumption. The electricity demand growth rate will largely be determined by classic drivers, such as macroeconomic and demographic development, but also increasingly by decarbonisation of the industrial, transport and heating sectors through direct electrification and green hydrogen.

At the beginning of the first quarter of 2022, Nordic water reservoirs were at 73 TWh, which is 11 TWh below the longterm average and 32 TWh lower than in the previous year. The deficit in water reservoirs decreased, owing to below normal hydro power production. At the end of the first quarter, the reservoir levels were at 35 TWh, which is 6 TWh below the long-term average and 20 TWh lower than in the previous year.

In the first quarter of 2022, power prices were at exceptionally high levels. The average system spot price in Nord Pool was EUR 110.0 (42.1) per MWh. The average area price in Finland was EUR 91.8 (48.6) per MWh, in the SE3 area in Sweden (Stockholm) EUR 99.9 (45.7) per MWh. However in the SE2 area in Sweden (Sundsvall) the average area price was EUR 24.8 (37.5) per MWh due to high precipitation and wind production. In Germany, the average spot price in the first quarter of 2022 was EUR 184.6 (49.6) per MWh.

In early May 2022, the Nordic system electricity forward price on Nasdaq Commodities for the remainder of 2022 was around EUR 97 per MWh and for 2023 around EUR 75 per MWh. The Nordic water reservoirs were at 29 TWh, which is about 7 TWh below the long-term average and 19 TWh lower than one year earlier. The German electricity forward price for the remainder of 2022 was around EUR 224 per MWh and for 2023 around EUR 203 per MWh.

European commodity markets

In the first quarter of 2022, gas demand in Central Western Europe was 699 (802) TWh. The Central Western European gas storage levels decreased significantly: from 293 TWh at the beginning of the quarter to 137 TWh at the end of the quarter, which is 14 TWh lower than one year ago and 60 TWh lower than the five-year average (2017– 2021).

Continuing tightness in the gas market, combined with the overhanging risk of disruptions in Russian pipeline gas flows to Europe, lifted European gas prices to unprecedented levels amid high volatility. The average gas front month price (TTF) in the first quarter of 2022 was EUR 101 (18) per MWh. The 2023 forward price increased from EUR 41 per MWh at the beginning of the quarter to EUR 72 per MWh at the end of the quarter, which is EUR 55 per MWh higher than one year earlier.

The volatility was high also in the EUA (EU Allowance) market during the first quarter of 2022, despite the rather small price difference between the start and end of the quarter. The price decreased from EUR 81 per tonne at the beginning of the quarter to EUR 77 per tonne at the end of the quarter, after first climbing to EUR 97 per tonne and then dropping to EUR 58 per tonne during the quarter. The EUA market closed the quarter EUR 34 per tonne higher than one year earlier.

Coal prices increased even more than gas prices during the first quarter. The forward quotation for coal (ICE Rotterdam) for 2023 increased from USD 88 per tonne at the beginning of the quarter to USD 190 per tonne at the end of the quarter, which is USD 121 per tonne above the price one year earlier.

In early May 2022, the TTF forward price for gas for the remainder of 2022 was EUR 95 per MWh. The forward quotation for EUAs for 2022 was at the level of EUR 85 per tonne. The forward price for coal (ICE Rotterdam) for the remainder of 2022 was USD 245 per tonne.

Russian power market

Fortum's Russia segment operates thermal power plants mainly in the Tyumen and Khanty-Mansiysk area of western Siberia, where industrial production is dominated by the oil and gas industries, and in the Chelyabinsk area of the Urals, which is dominated by the metal industry. Uniper's Russian subsidiary Unipro PJSC operates in the Smolensk, Moscow, Sverdlovsk, and Krasnoyarsk regions, as well as in the Khanty-Mansiysk Autonomous District.

The Russian market is divided into two price zones; Fortum's Russia division operates in the first price zone (European and Urals part of Russia), while Uniper operates in both the first and second price zones.

According to preliminary statistics, Russian power consumption was 303 (297) TWh during the first quarter of 2022. The corresponding figure for the first price zone was 229 (224) TWh and for the second price zone 61 (59) TWh. The 2.2% increase in consumption was caused by a 5.5% increase in economic growth.

In the first quarter of 2022, the average electricity spot price, excluding capacity prices, increased by 6.6% to RUB 1,449 (1,360) per MWh in the first price zone and by 19.9% to RUB 1,100 (918) in the second price zone. The spot price in the Urals hub increased by 11% and was RUB 1,284 (1,158) per MWh.

The Russian Government increased the gas price by 3% in July 2021.

In Russia, capacity payments based on Capacity Supply Agreements (CSA) are a key driver of earnings, as CSA payments are considerably higher than for capacities selected in Competitive Capacity Selection (CCS) auctions. Currently, Fortum's Russia segment's CSA capacity amounts to 1,472 MW, including 70 MW of solar and wind capacity. These capacities do not include those related to the joint ventures. Correspondingly, Uniper's CSA capacity amounts to 800 MW.

Thermal power plants are entitled to clearly higher CSA payments starting approximately six years after commissioning. In 2022, there is a decrease in CSA payments for four units of Fortum's Russia segment's generation fleet and for one unit of Fortum's Uniper segment's generation fleet. After the CSA period ends, the units can receive CCS payments from CCS auctions. See the corresponding changes in the table below:

Fortum's Russia segment's units	CSA start date	Higher CSA starts	CSA expiry date
Nyagan, unit 2	1 Dec 2013	1 Aug 2018	31 Dec 2022
Nyagan, unit 3	1 Jan 2015	1 Jan 2021	31 Dec 2025
Chelyabinsk CHP 4, unit 1	1 Dec 2015	1 Jan 2021	31 Dec 2024
Chelyabinsk CHP 4, unit 2	1 Mar 2016	1 Jan 2021	31 Dec 2024
Ulyanovsk*	1 Jan 2018	n/a	30 Nov 2031
Bugulchansk**	Nov 2016 – Mar 2017	n/a	Nov 2030 – Nov 2031
Pleshanovsk**	1 Mar 2017	n/a	30 Nov 2031
Grachevsk**	1 Mar 2017	n/a	30 Nov 2031

* Wind CSA. ** Solar CSA.

CSA start date Higher CSA starts	CSA expiry date
1 Nov 2014 1 Nov 2020	31 Oct 2024
Jun 2022 n/a	Feb 2038
Dec 2026 n/a	Nov 2042
Dec 2027 n/a	Nov 2043
Dec 2025 n/a	Nov 2041
Sep 2024 n/a	Aug 2040

* Started receiving CSA payments from 1 May 2021 when returning to the market after repairs.

** Modernisation CSA 2.

Fortum's Russia segment's generation capacity not receiving CSA payments, a total of 3,199.7 MW, is allowed to participate in the annual CCS auctions. Uniper's generation capacities allowed to participate in the CCS auction totalled 10,445 MW. The next CCS auction, for the year 2027, is expected to be held in November 2023.

Year	2020	2021	2022	2023	2024	2025	2026
CCS auction price, tRUB/MW/month, first price zone*	115	134	168	171	182	193	195
CCS auction price, tRUB/MW/month, second price
zone*	191	225	264	267	279	303	299
Fortum's Russia segment
Selected in CCS auction, MW, first price zone	2,331	2,848	3,451	3,904	3,904	4,351	4,852
Fortum's Uniper segment
Selected in CCS auction, MW,
first price zone	7,190	8,829	8,035	8,035	7,225	6,427	5,617
Selected in CCS auction, MW,
second price zone	1,600	1,600	1,600	1,600	2,400	2,400	2,400

* Excluding inflation.

Due to the current geopolitical situation, the ongoing Russia-Ukraine war and consequent supply chain constraints, Fortum is monitoring and assessing potential delays and the ability to complete ongoing projects. Fortum has stopped all new investment projects in Russia.

Fortum's Russian wind and solar portfolio (either in joint venture or direct ownership) comprises 1.2 GW of operational capacities and 0.3 GW under construction. However, as Fortum has stopped all new investment projects in Russia, the future of 1.9 GW of capacities under development is undecided.

In the June 2017 CSA auction, the Fortum-Rusnano wind investment fund won the right to build 1,000 MW of wind capacity. The wind parks were to be commissioned during 2018–2022 and will receive a guaranteed CSA price corresponding to approximately RUB 7,000–9,000 per MWh for a period of 15 years. In the June 2018 CSA auction, the Fortum-Rusnano wind investment fund won the right to build 823 MW of wind capacity. The wind parks were to be commissioned during 2019–2023 and will receive a guaranteed CSA price corresponding to approximately RUB 7,000–8,000 per MWh for a period of 15 years. The timeline for completion of the 0.8 GW projects originally planned to be commissioned in 2022 and 2023 is currently unclear.

In the June 2018 and 2019 CSA auctions, Fortum won the right to build 110 MW and 6 MW of solar capacity. On 2 March 2021, Fortum announced that Fortum and the Russian Direct Investment Fund (RDIF) will build the 116 MW solar power plant in Kalmykia in southern Russia. The power plants will receive a guaranteed CSA price for a period of 15 years, corresponding to approximately RUB 15,000 per MWh and RUB 14,000 per MWh, respectively. In December 2021, 78 MW of the capacity was commissioned and the remaining part is planned to be commissioned in the third quarter of 2022.

Fortum holds the right of CSA-backed capacities corresponding to approximately 1.4 GW of new wind projects awarded in a wind auction held in September 2021 and which were originally planned to be commissioned in 2025- 2027. As Fortum has stopped all new investment projects in Russia, these projects are not proceeding.

More detailed information about the market fundamentals is included in the tables at the end of the report.

Regulatory environment

The European Commission plans to reduce energy dependency on Russia

As a response to Russia's attack on Ukraine, the European Commission published the 'REPowerEU' Communication at the beginning of March with the objective to reduce EU demand for Russian gas by two-thirds by the end of the year. To reach the goal, the Commission is proposing to diversify gas supplies while simultaneously reducing the overall fossil fuel dependence. Diversification of gas supplies includes the use of liquefied natural gas (LNG) and higher production of biomethane and renewable hydrogen.

As part of a fast-track adoption process, the Commission issued a gas legislative proposal with the main goal to ensure that gas storage facilities are sufficiently filled by next winter, including a 90% gas storage filling obligation. In mid-May, this proposal will be followed by another proposal to optimise the electricity market design and a concrete plan to phase out Russian fossil fuels.

The European Parliament scrutinises the taxonomy rules on nuclear and natural gas

In mid-March, the Complementary Delegated Act, which sets the criteria for nuclear and gas under the EU taxonomy framework, was officially published by the Commission. This launched a scrutiny period during which both the Council and the European Parliament can reject the Act until mid-July 2022.

Even if parts of the Complementary Delegated Act require further clarification, it lays an important basis for the recognition of nuclear in achieving Europe's objective of carbon neutrality. Thus, Fortum has been advocating in favour of the adoption of the Act. However, debate is still ongoing on the inclusion of nuclear and gas under EU Taxonomy in particular in the European Parliament with the possibility of a veto not to be ruled out.

Swedish electrification strategy published

In February 2022, the Swedish Government presented a national electrification strategy. The strategy aims at presenting a comprehensive view on what is needed in order for the energy sector to grow and provide sufficient power for the electrification of industrial and transport sectors. Electrification is crucial in order to reach Sweden's goal of net zero greenhouse gas emissions by 2045. The strategy consists of 67 different assignments to be finalised during 2022-2024 in order to facilitate faster deployment of infrastructure, to provide for security of supply, to remove obstacles for new power production and to develop the electricity market.

Germany is taking measures to ensure security of supply

In late February, the German Federal Ministry of Economics and Climate Protection suspended the certification process for Nord Stream 2 in the context of the geopolitical situation. Furthermore, sanctions have been issued that do not allow the pipeline to be operated. In the interest of security of supply, the ministry introduced comprehensive measures including a precautionary plan that safeguards oil, gas and coal stocks through mandatory minimum reserves. In addition, the first of three stages of an emergency plan was activated at the end of March in order to prepare for a possible delivery stop. With this, the government continues to monitor the gas markets, but will not intervene for the time being.

Like other countries, Germany is suffering from higher energy prices. Efforts are being made to minimise dependency on Russian energy imports as quickly as possible and to ensure security of supply. In order to meet these challenges, lifetime extensions of coal-fired power plants are being considered and there is increasing support for the expansion of renewable energy. Gas is still seen as a necessary transitional fuel, but it will be procured from new supplier countries. Accordingly, the development of the LNG infrastructure is also supported by the federal government.

Germany accelerates its energy transition with a legislative "Easter package"

In January 2022, the Federal Ministry for Economic Affairs and Climate Action presented the German energy policy path. It was stated that Germany needs to take significant measures to reach targets set out in the Climate Protection Act 2021 and to meet the goal of climate neutrality in 2045. Therefore an "Immediate Climate Action Programme" consisting of two legislative packages ("Easter" and "Summer") was presented. The recently published "Easter package" consists of a series of proposals, such as the Renewable Energy Sources Act (EEG), the Amendment to the EEG as well as a reform of wind and solar expansion policies. The Easter package should be adopted before the summer.

Finnish climate and energy strategy published

The Finnish Government published the draft national climate and energy strategy and circulated it for comments on 14 April 2022. The strategy is a comprehensive programme of measures by which Finland will achieve the climate neutrality goal by 2035. In addition to the conventional emission reduction measures, the strategy discusses several specific themes: system integration and electrification, hydrogen and electric fuels, the heating system of the future, offshore wind power and evolving nuclear energy. The chapter on hydrogen also serves as a separate national hydrogen strategy and sets targets for the electrolysis capacity: 200 MW by 2025 and at least 1,000 MW by 2030. After the circulation for comments, the strategy will be passed to the parliament.

Appeals on the Finnish river basin management plans proceeding

Following the adoption of the river basin management plans (RBMP) by the Finnish Government in December 2021, Fortum made two appeals in January to the Supreme Administrative Court regarding the lower part of the Oulujoki water body and the Klobbfjärden water body which is the sea area around the Loviisa nuclear power plant. The main

reason for the appeals was the inadequacy in the classification of water bodies. Relevant authorities have submitted their statements during the first half of 2022 and Fortum is preparing its written replies to these statements to be submitted during the second quarter of 2022. Court decisions are expected during 2022.

Government permit granted for the final repository for spent nuclear fuel in Sweden

In January 2022, the Swedish Government made a decision to give the go-ahead to the final repository for spent nuclear fuel in Forsmark in Östhammar municipality and to an encapsulation plant in Oskarshamn. The next step in the licensing process is for the Land and Environment Court to establish conditions for the facilities; a building and operation permit on the interim storage facility is expected in June/July 2022. The Swedish Radiation Safety Authority will also decide on permit conditions under the Swedish Nuclear Activities Act. Construction can start once all licences are in place, after which time, it will take about 10 years to build the spent fuel repository.

Key drivers and risks

Fortum's financial results are exposed to a number of financial, operational, strategic and sustainability-related risks. Fortum is exposed to these risks both directly and indirectly through its subsidiaries, associated companies, and joint ventures. The principal associated companies and joint ventures are TVO, Forsmarks Kraftgrupp AB, Kemijoki Oy and TGC-1. For more information, please see each respective company's annual report.

Fortum is the majority shareholder of Uniper. However, Uniper remains a separate listed company operating under German law and regulations and with its own risk management systems. For more information about Uniper's risk management systems and risk exposures, please see Uniper's quarterly statement for the first quarter of 2022 and Annual report for 2021.

Russia's attack on Ukraine on 24 February 2022 has severely impacted Fortum's and Uniper's current and future businesses. Fortum has announced that no further investments will be made in Russia and that existing contracts will not be renewed when they expire. The company is also pursuing a controlled exit from the Russian market with potential divestments of its Russian operations as the preferred path. The divestment process for Uniper's Russian subsidiary Unipro is also expected to be resumed as soon as possible. These processes might take some time and are subject to regulatory approvals. However, the likelihood of a number of geopolitical risks that could negatively impact Fortum's current business has increased, and in some cases risks have been fully or partly realised.

The unpredictable nature of sanctions and possible countermeasures by Russia pose a significant risk for Fortum. The EU, US and UK have already implemented a number of sanctions towards Russia, targeting, among other things, the financial and energy sectors. The sanctions imposed so far restrict the possibility to make cross-border payments from Fortum's and Uniper's Russian units, which may affect repatriation of future dividends from the Russian operations, Group internal loan repayments and interest rate payments.

As a result of the imposition of US sanctions on Nord Stream 2 AG, Uniper and Fortum recorded a full impairment on the book value of the full outstanding receivable as well as the accrued interest towards Nord Stream 2 AG of approximately one billion euros in the first quarter results. Fortum also recorded EUR 275 million of impairments related to fixed assets and goodwill for the Russia segment, and EUR 555 million of impairments for fixed assets from the Uniper segment's Russian subsidiary Unipro. In addition, EUR 150 million impairments related to Fortum's ownership in the Russian TGC-1 and EUR 22 million of impairments on the joint ventures for renewables power generation in Russia were recorded.

A further widening of sanctions against Russia, and possible countermeasures, may impact current or future business relations. The curtailment risk on the physical supply of gas, coal, oil and other fuels from Russia could have follow-on implications, e.g. on the availability of Fortum's power plants and the physical deliveries to customers. In particular, curtailment of Russian gas could have a significant impact on Uniper's gas business. If this was to materialise it may require Uniper to source gas in the market at elevated prices to serve its customers. The German government is currently working on an amendment of the German Energy Security Law which is aimed at providing security for energy companies and their customers in case of a sudden energy emergency also with regards to a potential adjustment of gas prices. In case the curtailment of gas flows would be significant and cause a lack of a balance between gas supply and demand, the German authorities may declare a state of emergency. In this case the regulator (BNetzA), as so called federal load distributor (Bundeslastverteiler), would take control of the system and all market participants would have to act upon instructions of the federal load distributor. Already at the end of March, the early warning level according to the Emergency Gas Plan was declared by Federal Minister of Economics Robert Habeck.

Uniper is actively monitoring the situation and discussing risk mitigation measures with the responsible authorities. In addition, both Fortum and Uniper are committed to ensuring continued compliance with prevailing rules and applicable sanctions laws and are constantly preparing mitigation measures to minimise the impact an escalation would have on Fortum.

Since the Ukraine invasion, owning and operating profitable power and heat generation business in Russia has become challenging. For Fortum's Russian businesses, the key drivers are economic growth, the rouble exchange rate, interest rates (which also impact capacity payments) and the regulation of the power and heat business. Risks relating to these drivers are all partly realising driven by the deterioration of the overall economic and business environment including GDP growth and rising interest rates. The profitability of Fortum's Russian businesses in euro terms has been negatively impacted by the current geopolitical situation, and the risk of further deterioration increases with a prolonged conflict or further escalation. There is an increasing risk of countermeasures aimed at enabling nationalisation of foreign-owned assets in Russia in retaliation for Western sanctions. Such countermeasures could result in loss of control or, in extreme case, expropriation of Fortum's Russian assets. Fortum is preparing for such a scenario by ensuring Russian businesses are able to operate independently and in compliance with applicable laws, regulations and sanctions.

One of the key factors influencing Fortum's business performance is the Nordic electricity wholesale price. In the Nordics, power prices exhibit significant short- and long-term variations on the back of several factors, including but not limited to weather conditions, outage patterns in production and transmission lines, CO2 emission allowance prices, commodity prices, and the supply-demand balance. The Russian invasion into the Ukraine drove commodity prices to new heights and has further increased volatility. As a result, Fortum's portfolio value increased during the first quarter of 2022, which is generally positive for future earnings. However, the higher value combined with increased price volatility has led to an increase in the commodity price risk. Fortum hedges its exposure to commodity market prices and reports on the hedging levels of its outright power on a quarterly basis (see 'Outlook').

Fortum is exposed to liquidity and refinancing risks primarily through the need to finance the Group's business operations, including margining and collaterals issued for commercial activities. Following the elevated prices and increased volatility since the summer of 2021, the margining requirements from Fortum's hedges concluded via exchanges or under bilateral margining agreements decreased during the first quarter of 2022, but remain at a high level. The sensitivity to market price movement has significantly reduced since year-end 2021 due to expired positions and further mitigating actions taken to reduce the positions exposed to margin calls.

On 14 March, S&P Global Ratings placed Fortum's and Uniper's BBB ratings on Credit Watch Negative. The key risk factors indicated by S&P that could lead to weakening credit metrics and potentially trigger rating downgrades include the heightened risk of disruption to Uniper's natural gas procurements from Russia, the risk of increased working capital swings as a result of commodity price volatility and potential inability to transfer earnings outside of Russia.

In case of a rating downgrade, a lowering of the rating by one-notch is the most likely for both entities; however, a twonotch downgrade cannot be fully excluded. A lowering of credit ratings, in particular to below investment grade level (BB+ or below), would trigger counterparties' rights (mainly in Uniper's Global Commodities business) to demand additional cash or non-cash collateral. In addition, a downgrade could negatively affect access to the capital markets and increase the cost of new financing. Fortum targets to have a solid investment grade rating of at least BBB.

Fortum's business activities include energy generation, storage, distribution, and control of operations, as well as the construction, modernisation, maintenance and decommissioning of power plants or other energy industry facilities. Any unwanted operational event (which could be caused by e.g. technical failure, human or process error, natural disasters, sabotage, failure of key suppliers, or terrorist attack) can endanger personal safety or lead to environmental or physical damage, business interruptions, project delays and possible third-party liability. The associated costs can be high, especially in the Group's largest units and projects.

For further information about Fortum's risks and risk management systems, see Fortum's Financial Statements for 2021.

Outlook

Hedging

At the end of the first quarter of 2022, approximately 80% of the Generation segment's estimated Nordic power sales volume was hedged at EUR 35 per MWh for the remainder of 2022 (at the end of 2021: 75% at EUR 34 per MWh) and approximately 55% at EUR 33 per MWh for 2023 (at the end of 2021: 50% at EUR 31 per MWh).

At the end of the first quarter of 2022, approximately 75% of the Uniper segment's estimated Nordic power sales volume was hedged at EUR 26 per MWh for the remainder of 2022 (at the end of 2021: 80% at EUR 18 per MWh), approximately 50% at EUR 31 per MWh for 2023 (at the end of 2021: 60% at EUR 18 per MWh) and approximately 25 % at EUR 30 per MWh for 2024 (at the end of 2021: 20% at EUR 30 per MWh).

The reported hedge ratios are based on the hedges and power generation forecasts of the Generation segment and the forecasts of the Uniper segment's Nordic generation. The underlying generation assets and definition of hedges differ to some extent and thus are not fully comparable.

The reported hedge ratios may vary significantly, depending on Fortum's and Uniper's actions on the electricity derivatives markets. Hedges are mainly financial contracts, most of which are electricity derivatives quoted on Nasdaq Commodities and traded either with Nasdaq Commodities or with bilateral counterparties.

Capital expenditure

Fortum estimates its capital expenditure, including maintenance but excluding acquisitions, to be approximately EUR 1,500 million in 2022, of which the share of maintenance capital expenditure is estimated to be approximately EUR 800 million, well below the level of depreciation.

Generation

The Generation segment's achieved Nordic power price typically depends on factors such as hedge ratios, hedge prices, spot prices, availability and utilisation of Fortum's flexible generation portfolio, as well as currency fluctuations. Excluding the potential effects from changes in the power generation mix (currently approximately 45 TWh), a EUR 1 per MWh change in the Generation segment's achieved Nordic power price will result in an approximately EUR 45 million change in the segment's annual comparable operating profit. The achieved power price also includes the results of optimisation of Fortum's hydro and nuclear generation, as well as operations in the physical and financial commodity markets.

Uniper

Excluding the potential effects from changes in the power generation mix, a EUR 1 per MWh change in the Uniper segment's power sales price for outright generation (hydro and nuclear, currently approximately 25 TWh) will result in an approximately EUR 25 million change in the segment's annual comparable operating profit. Uniper also has generation other than hydro and nuclear power, and the sensitivity for that generation is different and is not included in the previously mentioned sensitivity.

With regard to Uniper, reference is made to the guidance that the company publishes quarterly.

Russia

In the Russia segment, the financial effect of the CSAs is expected to be negative in 2022 compared to 2021, due to the impact of the expiry of the CSA period of the Nyagan 1 generation unit, partly offset by a higher bond yield.

Income taxation

In 2022, the comparable effective income tax rate (excluding items affecting comparability) for Fortum is estimated to be in the range of 22-25%. Following the consolidation of Uniper, the weight of the profit in different jurisdictions has resulted in an upward trend in the lower end of the range of the tax rate guidance currently driven by the higher nominal tax rates in the Group's major operating countries.

Possible impacts, if any, of a global minimum tax as stated in the proposed EU directive from 20 December 2021, are not taken into account in this guidance.

Sustainability

In this interim report, selected sustainability key performance indicators that include Uniper are disclosed.

Fortum highlights the importance of decarbonisation and climate change mitigation, while at the same time the necessity to secure reliable and affordable energy for all. Fortum also gives balanced consideration in its operations to the promotion of energy efficiency and a circular economy, as well as its impacts on personnel and societies.

Based on the above-mentioned priorities, Fortum's sustainability priority areas are:

Climate and resources	Personnel and society	Governance
Climate change and GHG emissions	Health, safety and wellbeing	Business ethics and
		compliance
Emissions to air, land and water	Diversity, equity and inclusion	Corporate governance
Energy efficiency	Fair and attractive employer	Innovation and digitalisation
Circular economy and waste	Human rights	Shared value creation
management
Biodiversity	Stakeholder engagement	Customer rights and
		satisfaction
Secure and affordable energy supply	Just transition
Water use and optimisation	Corporate citizenship

Fortum's sustainability performance is monitored and disclosed in interim and annual reporting. Fortum publishes an annual Sustainability Report with more extensive information on Fortum's sustainability performance.

Sustainability targets

Fortum updated its climate targets aligned with the goals of the Paris Agreement in December 2020 and is committed to carbon neutrality by 2050 at the latest. The target covers direct CO2 emissions (Scope 1) and indirect CO2 emissions (Scope 2 and 3). Fortum's roadmap to reduce emissions in Europe has also been defined. Fortum is committed to at least a 50% CO2 emissions reduction (Scope 1 and 2) in its European generation by 2030 (compared to base year 2019) and to carbon neutrality (Scope 1 and 2) by 2035 at the latest.

Scope 3 emissions play a significant role in Fortum's total emissions. In December 2021, Fortum committed to reduce Scope 3 greenhouse gas emissions by 35% by 2035 at the latest (compared to base year 2021).

In 2022, Fortum's target is to develop a science-based strategy to measure and enhance the biodiversity impacts of the Group's operations and the new developments.

For Fortum, excellence in safety and caring about both its own employees and contractors is the foundation of the company's business and an absolute prerequisite for efficient and interruption-free production. Fortum's safety targets are measured as:

• Zero severe occupational accidents
• Total Recordable Injury Frequency (TRIF), for own personnel and contractors; the ambitious goal is <1.0 by the end of 2025
• Severity rate per TRI (i.e. number of lost days divided by number of Total Recordable Injuries), for own personnel and contractors: ≤11 in 2022

Fortum employees are committed to getting involved and becoming an active part of creating a new joint safety culture. For that purpose, in 2022 Fortum is launching the Safety Culture Programme that includes trainings, webinars and workshops for all organisational levels:

• New Safety eLearning training for all Fortum employees to be launched in quarter two of 2022
• Safety Leadership Programme 2022 for Executives, including ten workshops for about 250 Fortum Executives in Espoo and Düsseldorf, to be launched in quarter two of 2022
• Middle-management training in 2023

Fortum's minimum goal for completion of the trainings (Safety eLearning and Safety Leadership Programme for Executives) is 85% in 2022.

Both Fortum and Uniper are supporters of the Task Force on Climate-related Financial Disclosures (TCFD). Fortum has a long-standing focus on mitigating climate change and adopted the reporting recommendations of the TCFD starting from the financial year 2019.

Fortum's Climate Lobbying Review was published in December 2021 and is publicly disclosed on Fortum's website. The summary of the review was also published as part of Fortum's Sustainability 2021 report.

The table below shows Fortum's sustainability performance with selected key indicators.

Group sustainability performance 2022

	I/2022	I/2021	2021
Climate and resources
Total CO2 emissions, million tonnes	20.5	20.3	68.7
Specific CO2 emissions from total energy production, gCO2/kWh	319	307	312
Asset availability of power generation plants, %	85.8	85.2	80.8
Major environmental incidents*, no.	1	1	4
Personnel and society
Total Recordable Injury Frequency (TRIF), own personnel and contractors	2.2	1.6	2.2
Severity rate per TRI**, own personnel and contractors	10.2	-	-
Severe occupational accidents, no.	0	1	3
Safety eLearning***, %	0	-	-
Safety Leadership Programme for Executives****, %	0	-	-
Sickness-related absences, %	5.3	3.5	3.6

* Number of environmental incidents that resulted in significant harm to the environment (ground, water, air) or an environmental non-compliance with legal or regulatory requirements. The figures for 2021 exclude Uniper.

** Number of lost days divided by number of Total Recordable Injuries (TRI)

*** Completion rate. The figure excludes Uniper. Training to be launched in the second quarter of 2022.

**** Completion rate. Training to be launched in the second quarter of 2022.

Fortum's goal is to achieve excellent financial performance in strategically selected core areas through strong competence and responsible ways of operating. Fortum received a score of A- in the CDP Climate Change 2021 rating, and Uniper received a score of B. In the MSCI ESG Ratings assessment, Fortum received a "BBB" rating in 2021 and Uniper a "BB" rating in 2022. Both companies have also participated in the ISS ESG Corporate Rating, where Fortum received a "Prime B-" rating and Uniper a "Medium C" rating. In 2022, Fortum was awarded Gold EcoVadis Medal. Uniper has received the same rating in EcoVadis 2021 assessment. In 2022, Fortum has also been rated 62 points out of a maximum 100 points by Moody's ESG Solutions. In addition, Fortum is listed on the Nasdaq Helsinki exchange and is included in the STOXX Global ESG Leaders, OMX Sustainability Finland, and ECPI® indices.

Climate and resources

Fortum's key performance indicators for climate and resources are related to CO2 emissions, security of supply, biodiversity, and major Environmental, Health and Safety (EHS) incidents. Operational-level activities follow the requirements set forth in the ISO 14001 environmental management standard, and 100% of Fortum's power and heat production worldwide has ISO 14001 certification.

Fortum Group's power generation is mainly based on natural gas-fired generation and on carbon dioxide-free hydro and nuclear power. Fortum targets to rapidly reduce the share of coal in power generation. A minor share of Fortum's power generation is currently based on solar and wind, but Fortum targets significant growth in this area over the next five years.

Fortum is also a large district heat producer in several cities. Heat is mainly produced at natural gas-fired and energyefficient combined heat and power (CHP) plants. In addition, Uniper operates a large commodities trading business and has natural gas storage sites, which play an important role in ensuring a secure and flexible gas supply. Fortum wants to enable the energy transition by providing a reliable and affordable supply of low-carbon energy. In the future, the energy system – and Fortum's asset portfolio – will be based on renewable energy, increasingly clean gas (e.g. hydrogen), and nuclear power. In addition, Fortum will continue to offer industrial and infrastructure solutions, e.g., waste-to-energy, grid stability services, as well as energy sales and storage.

In January−March 2022, Fortum's direct CO² emissions were 20.5 (20.3) Mt. Of the total CO2 emissions, 7.9 (8.1) Mt were within the EU and UK emissions trading system (ETS). The estimate for Fortum's free emission allowances in 2022 is approximately 0.3 (0.4) Mt.

Fortum's total CO2 emissions* (million tonnes, Mt)	I/2022	I/2021	2021
Total emissions	20.5	20.3	68.7
Emissions subject to ETS	7.9	8.1	28.9
Free emission allowances	-	-	0.4
Emissions not subject to ETS in Europe	0.2	0.2	0.7
Emissions in Russia	12.4	11.9	39.0

In January−March 2022, Fortum's specific CO2 emissions from total energy production were 319 (307) gCO2/kWh.

An uninterrupted and reliable energy supply is critical for society to function. In January−March 2022, the asset availability of Fortum's gas-fired and coal-fired power plants was, on average, 85.8 (85.2)%.

In 2022, the definition of major environmental incidents was aligned between Fortum and Uniper. The figure now includes environmental incidents that resulted in causing significant harm to the environment (ground, water, air) and environmental non-compliances with legal or regulatory requirements. In January−March 2022, there was one major environmental incident in Fortum's hydropower operations in Sweden. The environmental incident was related to the breach of minimum discharge, and it did not have significant environmental impacts.

Personnel and society

Fortum's key performance indicators for personnel and society are related to operational and occupational safety and to employee health and wellbeing.

Fortum strives to be a safe workplace for the employees, contractors, and service providers who work for the company. A certified ISO 45001 safety management system covers 99.1% of Fortum's power and heat production worldwide.

In January−March 2022, Fortum's TRIF (Total Recordable Injury Frequency) for own personnel and contractors was 2.2 (1.6). The severity rate per TRI for own personnel and contractors was 10.2, which was below the set target: ≤11 for 2022. Fortum's LTIF (Lost Time Injury Frequency) for own personnel and contractors was 1.2 (1.2). Fortum strives for zero severe occupational accidents. In January−March 2022, there were no (1) severe occupational accidents in the operations.

Fortum's goal regarding workplace wellbeing activities is to promote the health and occupational safety of employees and the functionality of the work community. In January-March 2022, Fortum's percentage of sickness-related absences was 5.3 (3.5).

Fortum and Uniper expect their business partners to act responsibly and to comply with the requirements set forth in their respective Codes of Conduct and Supplier Codes of Conduct. Fortum assesses the performance of its business partners with supplier qualification and supplier audits. In January−March 2022, Fortum, excluding Uniper, conducted two on-site supplier audits in China. Due to the Covid-19 pandemic and travel restrictions, the possibilities to conduct

on-site supplier audits have been very limited. Uniper applies its own processes for ESG Due Diligence and Know Your Counterparty. Both companies are members of the Bettercoal Initiative and use the Bettercoal tools to improve sustainability in the coal supply chain.

Legal actions

There were no material changes in the ongoing legal actions during the first quarter of 2022. For further information on legal actions, see Note 21.

Shares and share capital

Fortum shares on Nasdaq Helsinki

January–March 2022	No. of shares traded	Total value EUR	High EUR	Low Average EUR		Last EUR
FORTUM	141,926,051	2,843,236,505	27.18	14.14	20.02	16.53
* Volume weighted average.
				31 March 2022		31 March 2021
Market capitalisation, EUR million				14.7		20.2
Number of shareholders				194,586		205,540
Finnish State holding, %				50.8		50.8
Nominee registrations and direct foreign shareholders, %				27.6		24.5
Households, %				11.6		13.0
Financial and insurance corporations, %				1.5		2.1
Other Finnish investors, %				8.5		9.6

In addition to Nasdaq Helsinki, Fortum shares were traded on several alternative market places, for example Boat, Cboe and Turquoise, and on the OTC market. In January−March 2022, approximately 72% of Fortum's shares were traded on markets other than Nasdaq Helsinki (source Bloomberg).

On 31 March 2022, Fortum Corporation's share capital was EUR 3,046,185,953 and the total number of registered shares was 888,294,465. Fortum Corporation does not hold any of the company's own shares.

Group personnel

The operations of the Fortum Group are mainly based in the Nordic countries, Central Europe, Russia, United Kingdom, and Poland. The total number of employees at the end of March 2022 was 19,260 (19,140 at the end of 2021).

At the end of March 2022, the Generation segment had 1,262 (1,116 at the end of 2021) employees, Russia 2,744 (2,627 at the end of 2021), City Solutions 1,751 (1,766 at the end of 2021), Consumer Solutions 1,185 (1,176 at the end of 2021), Uniper 11,319 (11,494 at the end of 2021, of which 4,267 in Russia), and Other Operations 999 (961 at the end of 2021).

Annual General Meeting 2022

The Annual General Meeting of Fortum Corporation (AGM) was held at the company headquarters in Espoo, Finland, on 28 March 2022 under special arrangements. The Annual General Meeting adopted the Financial Statements and the Consolidated Financial Statements for the financial period 1 January−31 December 2021 and discharged from

liability for the year 2021 all the persons who had served as members of the Board of Directors and as President and CEO during the year 2021.

The AGM resolved that a dividend of EUR 1.14 per share will be paid for the financial year that ended on 31 December 2021. The record date was 30 March 2022 and the dividend was paid on 6 April 2022.

The AGM resolved to approve the remuneration report for the company's governing bodies for 2021. The resolution is advisory.

The AGM resolved that the annual fee of the Chair, Deputy Chair and other members of the Board of Directors will be changed as follows:

• for the Chair EUR 88,800 per year,
• for the Deputy Chair EUR 63,300 per year,
• for a Member EUR 43,100 per year, and
• for the Chair of the Audit and Risk Committee: EUR 63,300 per year, provided that he/she does not simultaneously act as Chair or Deputy Chair of the Board of Directors.

In addition to the aforementioned annual fee, fixed fees will be paid for the Committee work as follows:

• for a Member of the Audit and Risk Committee EUR 3,000 per year,
• for the Chair of the Nomination and Remuneration Committee EUR 5,000 per year,
• for a Member of the Nomination and Remuneration Committee EUR 2,000 per year,
• for the Chair of any additional Committee established by a Board decision EUR 5,000 per year, and
• for a Member of any additional Committee established by a Board decision EUR 2,000 per year.

The meeting fee payable to a Board member, also for the Committee meetings will be EUR 800 for each meeting, or EUR 1,600 if the member travels to the meeting outside his/her country of residence. When a member participates in the meeting via remote connection, or for the decisions that are confirmed without convening a meeting, the meeting fee will be EUR 800. The travel expenses of Board members are compensated in accordance with the company's travel policy. The annual fee for the Board work of the Board members will be paid in company shares and in cash in such a way that approximately 40 % of the amount of the annual fee will be payable in shares acquired on behalf and in the name of the Board members, and the remainder in cash. The company will pay the costs and the transfer tax related to the purchase of the company shares. The shares will be acquired on behalf and in the name of the Board members within two weeks following the publication of the company's first-quarter 2022 interim report. If share purchases cannot be carried out within the aforementioned schedule due to a reason related to the company or a Board member, the shares will be acquired later, or the annual fee will be paid fully in cash. The meeting fees and the fixed fees for the Committee work will be paid fully in cash.

The AGM resolved that the Board of Directors will consist of nine members. Veli-Matti Reinikkala as Chair, Anja McAlister as Deputy Chair, and Luisa Delgado, Essimari Kairisto, Teppo Paavola, Philipp Rösler, Annette Stube were re-elected as members. Ralf Christian and Kimmo Viertola were elected as new members.

In addition, Deloitte Oy was re-elected as the auditor. The auditor's fee is paid pursuant to an invoice approved by the company.

The AGM authorised the Board of Directors to decide on the repurchase and disposal of the company's own shares, up to 20,000,000 shares, which corresponds to approximately 2.25 per cent of all the shares in the company. Only the unrestricted equity of the company can be used to repurchase own shares on the basis of the authorisation. These authorisations cancelled the authorisations resolved by the AGM 2021 and will be effective until the next Annual General Meeting and in any event no longer than for a period of 18 months.

The AGM authorised the Board of Directors to decide on contributions in the total maximum amount of EUR 500,000 for charitable or similar purposes, and to decide on the recipients, purposes and other terms of the contributions. The authorisation will be effective until the next Annual General Meeting.

Board decisions

At its meeting held after the Annual General Meeting, Fortum's Board of Directors elected, from among its members, to the Nomination and Remuneration Committee Veli-Matti Reinikkala as Chair and Luisa Delgado, Anja McAlister,

and Kimmo Viertola as members. Furthermore, the Board elected to the Audit and Risk Committee Essimari Kairisto as Chair and Teppo Paavola, Philipp Rösler, Annette Stube, and Ralf Christian as members.

Events after the reporting period

On 5 May 2022, Uniper announced that the company has been chosen to build and operate Germany's first LNG terminal in Wilhelmshaven. Uniper will invest around EUR 65 million in the project. In addition, a letter of intent was signed by all contracting parties in the project for the purchase of two floating storage and regasification units (FSRU). Uniper had optioned both FSRUs on the market for the German Government. The plan is to have the terminal in use in the winter 2022-2023. Through the project, Uniper is supporting the German government in its plans to diversify its supply sources of natural gas in order to decrease its dependence on natural gas supplied from Russia. Germany plans to develop a green energy hub in Wilhelmshaven. Uniper is supporting this initiative with its Green Wilhelmshaven project.

Dividend payment

The AGM 2022 decided to pay a dividend of EUR 1.14 per share for the financial year that ended 31 December 2021. The record date for the dividend payment was 30 March 2022 and the dividend payment date 6 April 2022.

Espoo, 11 May 2022

Fortum Corporation Board of Directors

Further information:

Investor Relations and Financial Communications: Ingela Ulfves, tel. +358 40 515 1531, Rauno Tiihonen, tel. +358 10 453 6150, Carlo Beck, tel. +49 172 751 2480, Nora Hallberg, tel. +358 40 720 1775, Pirjo Lifländer, tel. +358 40 643 3317, and investors@fortum.com

Media: Fortum News Desk, tel. +358 40 198 2843

The condensed Interim Report has been prepared in accordance with International Accounting Standard (IAS) 34, Interim Financial Reporting, as adopted by the EU. The interim financials have not been audited.

Financial calendar in 2022

Fortum will publish its interim reports in 2022:

• January–June on 12 August 2022 at approximately 9.00 EEST
• January–September 10 November 2022 at approximately 9.00 EET

Uniper will publish its interim reports in 2022:

• Financial Results January–June 2022 on 2 August 2022
• Financial Results January–September 2022 on 3 November 2022

Distribution:

Nasdaq Helsinki Key media www.fortum.com

More information, including detailed quarterly information, is available at www.fortum.com/investors

Interim Financial Statements are unaudited.

Condensed consolidated income statement

EUR million	Note	I/2022	I/2021	2021	LTM
Sales	3	43,623	21,493	112,400	134,530
Other income		4,839	1,666	12,380	15,554
Materials and services		-43,618	-19,491	-105,170	-129,297
Employee benefits		-360	-372	-1,561	-1,549
Depreciation and amortisation	3	-334	-308	-1,281	-1,307
Other expenses		-4,589	-1,817	-14,232	-17,004
Comparable operating profit	3	-438	1,171	2,536	927
Items affecting comparability	3, 4	-1,978	174	-3,124	-5,276
Operating profit	3	-2,416	1,345	-588	-4,349
Share of profit/loss of associates and joint ventures	3, 12	-190	80	192	-78
Interest expense		-68	-47	-202	-223
Interest income		26	37	156	145
Other financial items - net		-914	46	154	-806
Finance costs - net	7	-956	36	107	-884
Profit before income tax		-3,561	1,460	-289	-5,310
Income tax expense	8	728	-150	175	1,054
Net profit		-2,833	1,310	-114	-4,256
Attributable to:
Owners of the parent		-2,222	1,092	739	-2,575
Non-controlling interests		-610	218	-852	-1,681
		-2,833	1,310	-114	-4,256
Earnings per share for profit attributable to the equity owners of the company (EUR per share)
Basic		-2.50	1.23	0.83	-2.90

As Fortum currently has no dilutive instruments outstanding, diluted earnings per share is the same as basic earnings per share.

EUR million	Note	I/2022	I/2021	2021	LTM
Comparable operating profit		-438	1,171	2,536	927
Impairment charges and reversals		-830	-1	-83	-911
Capital gains and other related items		3	51	2,681	2,634
Changes in fair values of derivatives hedging future cash flow		-1,107	165	-5,424	-6,696
Other		-44	-41	-299	-302
Items affecting comparability	3, 4	-1,978	174	-3,124	-5,276
Operating profit		-2,416	1,345	-588	-4,349

See Note 24 Definitions and reconciliations of key figures.

Condensed consolidated statement of comprehensive income

EUR million	Note	I/2022	I/2021	2021	LTM
Net profit		-2,833	1,310	-114	-4,256
Other comprehensive income
Items that may be reclassified to profit or loss in subsequent periods:
Cash flow hedges
Fair value gains/losses 1)		-1,780	-35	-1,365	-3,110
Transfers to income statement		598	63	117	653
Transfers to inventory/property, plant and equipment		1	1	1	1
Deferred taxes		346	-8	265	618
Net investment hedges
Fair value gains/losses		19	3	-15	1
Deferred taxes		-5	0	1	-5
Exchange differences on translating foreign operations 2)		-334	125	322	-137
Share of other comprehensive income of associates and joint ventures		22	8	8	22
Other changes		-	52	20	-32
		-1,134	208	-646	-1,988
Items that will not be reclassified to profit or loss in subsequent periods:
Remeasurement of investments		-15	3	-6	-24
Actuarial gains/losses on defined benefit plans		189	133	226	283
Actuarial gains/losses on defined benefit plans in associates and joint ventures		2	-	29	31
		176	136	250	290
Other comprehensive income/expense for the period, net of deferred taxes		-957	343	-397	-1,697
Total comprehensive income/expense for the period		-3,790	1,653	-510	-5,953
Total comprehensive income/expense attributable to:
Owners of the parent		-3,048	1,355	185	-4,218
Non-controlling interests		-742	299	-695	-1,735
		-3,790	1,653	-510	-5,953

1) Fair valuation of cash flow hedges mainly relates to fair valuation of derivatives, such as futures and forwards, hedging commodity price for future transactions, where hedge accounting is applied. When commodity price is higher (lower) than the hedging price, the impact on equity is negative (positive).

2) Translation differences from translation of foreign entities, mainly RUB and SEK.

Condensed consolidated balance sheet

EUR million	Note	31 Mar 2022	31 Dec 2021
ASSETS Non-current assets
Intangible assets	10	1,954	2,167
Property, plant and equipment and right-of-use assets	11	17,111	19,049
Participations in associates and joint ventures	12	2,225	2,461
Shares in Nuclear Waste Funds	16	3,399	3,515
Other non-current assets		579	570
Deferred tax assets		3,180	2,149
Derivative financial instruments	5	38,217	17,096
Long-term interest-bearing receivables	14	1,321	2,392
Total non-current assets		67,987	49,399
Current assets
Inventories		3,895	2,275
Derivative financial instruments	5	105,593	65,392
Short-term interest-bearing receivables	14	640	715
Income tax receivables		170	161
Margin receivables	15	7,441	9,163
Trade and other receivables		13,323	14,856
Liquid funds	15	6,419	7,592
Total current assets		137,482	100,155
Assets held for sale	6	956	108
Total assets		206,425	149,661
EQUITY
Equity attributable to owners of the parent
Share capital		3,046	3,046
Share premium		73	73
Retained earnings		6,479	10,062
Other equity components		-1,563	-1,050
Total		8,036	12,131
Non-controlling interests		727	1,534
Total equity		8,762	13,665
LIABILITIES
Non-current liabilities
Interest-bearing liabilities	15	7,026	8,701
Derivative financial instruments	5	32,853	16,657
Deferred tax liabilities		679	827
Nuclear provisions	16	3,840	3,891
Other provisions	17	4,666	4,108
Pension obligations, net	18	931	1,190
Other non-current liabilities Total non-current liabilities		460 50,455	397 35,771
Current liabilities
Interest-bearing liabilities	15	7,849	8,519
Derivative financial instruments	5	117,224	71,947
Other provisions	17	3,018	2,299
Margin liabilities	15	1,864	985
Trade and other payables		16,892	16,477
Total current liabilities		146,847	100,226
Liabilities related to assets held for sale	6	360	-
Total liabilities		197,662	135,997
Total equity and liabilities		206,425	149,661

Condensed consolidated statement of changes in total equity

			Retained earnings			Other equity components
							OCI items
				Translation			associates		Non
	Share	Share	Retained	of foreign	Cash flow	Other OCI	and joint	Owners of	controlling	Total
EUR million	capital	premium	earnings	operations	hedges	items	ventures	the parent	interests	equity
Total equity 1 January 2022	3,046	73	12,830	-2,768	-1,138	34	54	12,131	1,534	13,665
IS Net profit			-2,222					-2,222	-610	-2,833
Translation differences				-313	5	1		-307	-27	-334
Other comprehensive income					-691	149	23	-519	-104	-623
Total comprehensive income for the period			-2,222	-313	-686	150	23	-3,048	-742	-3,790
Cash dividend			-1,013					-1,013		-1,013
Transactions with non-controlling interests			-37					-37	-66	-103
Other			3					3		3
BS Total equity 31 March 2022	3,046	73	9,560	-3,081	-1,824	184	77	8,036	727	8,762
Total equity 1 January 2021	3,046	73	13,097	-2,948	-158	-175	18	12,953	2,624	15,577
IS Net profit			1,092					1,092	218	1,310
Translation differences				93	2	5		100	25	125
Other comprehensive income					21	135	7	163	55	218
Total comprehensive income for the period			1,092	93	23	140	7	1,355	299	1,653
Transactions with non-controlling interests			-9					-9	-17	-26
Other			5					5	3	8
BS Total equity 31 March 2021	3,046	73	14,184	-2,855	-136	-35	25	14,303	2,910	17,213
Total equity 1 January 2021	3,046	73	13,097	-2,948	-158	-175	18	12,953	2,624	15,577
IS Net profit			739					739	-852	-114
Translation differences				180	2	2		184	137	322
Other comprehensive income					-982	207	37	-738	20	-718
Total comprehensive income for the period			739	180	-980	209	37	185	-695	-510
Cash dividend			-995					-995	-171	-1,166
Transactions with non-controlling interests			-15					-15	-221	-236
Other			3					3	-3	0
BS Total equity 31 December 2021	3,046	73	12,830	-2,768	-1,138	34	54	12,131	1,534	13,665

Translation differences

Translation of financial information from subsidiaries in foreign currency is done using the average rate for the income statement and the end rate for the balance sheet. The exchange rate differences arising from translation (mainly related to RUB and SEK) to EUR are recognised in equity. For information regarding exchange rates used, see Note 1.4 Key exchange rates used in consolidated financial statements.

Cash flow hedges

The impact on equity attributable to owners of the parent from fair valuation of cash flow hedges mainly relates to fair valuation of commodity derivatives, such as futures and forwards, hedging commodity sales price of future transactions, where hedge accounting is applied. When commodity market price is higher (lower) than the hedging price, the impact on equity is negative (positive).

Cash dividends

A dividend for 2021 of EUR 1.14 per share, amounting to a total of EUR 1,013 million, was decided in the Annual General Meeting on 28 March 2022. The dividend was paid on 6 April 2022. See Note 9 Dividend per share.

Condensed consolidated cash flow statement

EUR million	Note	I/2022	I/2021	2021	LTM
Cash flow from operating activities
IS Net profit		-2,833	1,310	-114	-4,256
Adjustments:
Income tax expense		-728	150	-175	-1,054
Finance costs - net		956	-36	-107	884
Share of profit/loss of associates and joint ventures	12	190	-80	-192	78
Depreciation and amortisation	3	334	308	1,281	1,307
Operating profit before depreciations (EBITDA)		-2,082	1,653	693	-3,042
Items affecting comparability	3, 4	1,978	-174	3,124	5,276
Comparable EBITDA		-104	1,479	3,817	2,234
Non-cash and other items 1)		386	278	1,506	1,615
Interest received		14	13	75	76
Interest paid		-95	-61	-202	-237
Dividends received		1	6	124	119
Income taxes paid		-158	-93	-493	-558
Funds from operations 1)		45	1,621	4,827	3,250
Change in working capital 1)		-1,574	-790	144	-640
Net cash from operating activities		-1,529	831	4,970	2,610
Cash flow from investing activities
Capital expenditures	3	-202	-293	-1,178	-1,087
Acquisitions of shares 2)	6	-12	-22	-294	-284
Proceeds from sales of property, plant and equipment		75	14	20	81
Divestments of shares and capital returns	6	6	129	3,863	3,740
Shareholder loans to associated companies and joint ventures	14	26	-19	-8	36
Change in margin receivables		1,722	16	-7,964	-6,258
Change in other interest-bearing receivables	14	44	-19	-166	-103
Net cash from/used in investing activities		1,659	-194	-5,727	-3,873
Cash flow before financing activities		130	637	-756	-1,264
Cash flow from financing activities
Proceeds from long-term liabilities	15	0	62	3,439	3,377
Payments of long-term liabilities	15	-300	-42	-2,315	-2,574
Change in short-term liabilities	15	-1,787	295	5,364	3,282
Dividends paid to the owners of the parent	9	0	0	-995	-995
Dividends paid to non-controlling interests		0	0	-171	-171
Change in margin liabilities		875	339	649	1,184
Other financing items		-75	1	43	-33
Net cash from/used in financing activities		-1,287	655	6,013	4,071
Net increase(+)/decrease(-) in liquid funds		-1,158	1,292	5,256	2,807
Liquid funds at the beginning of the period	15	7,592	2,308	2,308	3,618
Foreign exchange differences in liquid funds		-15	18	29	-4
Liquid funds at the end of the period 3)	15	6,420	3,618	7,592	6,420

1) In IV/2021, CO2 emission allowances included in Intangible assets were reclassified to Inventories. The change is also reflected in Change in working capital and Non-cash and other items. Comparatives have been reclassified accordingly.

2) From I/2022, acquisition of additional shares in Uniper are presented in cash flow from financing activities to better reflect the requirements of IAS 7 Statement of cash flows. Until IV/2021 acquisition of additional shares in Uniper were presented in cash flow from investing activities. Comparatives have not been restated.

3) Includes liquid funds of EUR 1 million relating to assets held for sale at 31 March 2022. See Note 6.3 Assets held for sale.

Additional cash flow information

Change in working capital

EUR million	I/2022	I/2021	2021	LTM
Change in interest-free receivables, decrease(+)/increase(-)	1,457	-3	-5,892	-4,432
Change in inventories, decrease(+)/increase(-) 1)	-1,619	-83	-192	-1,728
Change in interest-free liabilities, decrease(-)/increase(+)	-1,412	-704	6,227	5,519
CF Total 1)	-1,574	-790	144	-640

1) In IV/2021, CO2 emission allowances included in Intangible assets were reclassified to Inventories. The change is also reflected in Change in working capital and Non-cash and other items. Comparatives have been reclassified accordingly.

Capital expenditure in cash flow

EUR million	I/2022	I/2021	2021	LTM
Capital expenditure	162	228	1,116	1,050
Change in not yet paid investments, decrease(+)/increase(-)	42	74	78	45
Capitalised borrowing costs	-2	-9	-16	-8
CF Total	202	293	1,178	1,087

Acquisition of shares in cash flow

Acquisition of shares, net of cash acquired, amounted to EUR 12 million during I/2022 (I/2021: 22). For additional information, see Note 6.1 Acquisitions. From I/2022, acquisition of additional shares in Uniper are presented in cash flow from financing activities to better reflect the requirements of IAS 7 Statement of cash flows. Until IV/2021 acquisition of additional shares in Uniper were presented in cash flow from investing activities. Comparatives have not been restated.

Divestment of shares in cash flow

EUR million	I/2022	I/2021	2021	LTM
Proceeds from sales of subsidiaries, net of cash disposed	0	128	932	804
Proceeds from sales and capital returns of associates and joint ventures	0	0	2,903	2,903
Proceeds from sales of other investments	6	-	28	34
CF Total	6	129	3,863	3,740

There were no material divestments during I/2022. During 2021, Fortum completed the divestment of the 50% stake in the Swedish district heating and cooling company Stockholm Exergi, the district heating business in the Baltics, the Pavagada II and the Rajasthan solar power plants in India, the 80% stake in the Sørfjord wind park in Norway and eight small hydropower plants in Sweden. For further information, see Note 6.2 Disposals.

Change in financial net debt

EUR million	Note	I/2022	2021
Financial net debt, beginning of the period		789	7,023
Comparable EBITDA		-104	3,817
Non-cash and other items		386	1,506
Paid net financial costs and dividends received		-80	-3
Income taxes paid		-158	-493
Change in working capital		-1,574	144
Capital expenditures		-202	-1,178
Acquisitions		-12	-294
Divestments and proceeds from sale of property, plant and equipment		81	3,883
Change in interest-bearing receivables		70	-174
Dividends to the owners of the parent		0	-995
Dividends to non-controlling interests		0	-171
Other financing activities		-75	43
Net cash flow ('-' increase in financial net debt)		-1,668	6,084
Foreign exchange rate differences and other changes		-222	-150
Financial net debt, end of the period	15	2,235	789

Excludes financial net debt relating to assets held for sale. See Note 6 Acquisitions, disposals and assets held for sale.

Capital risk management

The long-term financial targets are:

• • Financial net debt/comparable EBITDA below 2x
• Hurdle rates for new investments of WACC
• − +100 bps for green investments
  • − +200 bps for other investments

Comparable EBITDA is defined as an alternative performance measure and used as a component in the capital structure target 'Financial net debt-to-Comparable EBITDA'.

Fortum targets to have a solid investment grade rating of at least BBB.

In January 2022, S&P Global Ratings affirmed both Fortum's and Uniper's rating of BBB with a stable outlook. Fortum's dividend policy 'is to pay a stable, sustainable, and over time increasing dividend'.

On 14 March 2022, S&P Global Ratings placed Fortum's and Uniper's BBB ratings on Credit Watch Negative. The key risk factors indicated by S&P which could lead to weakening credit metrics and potentially trigger rating downgrades include the heightened risk of disruption to Uniper's natural gas procurements from Russia, the risk of increased working capital swings as a result of commodity price volatility and potential inability to transfer earnings outside of Russia. In case of a rating downgrade, a lowering of the rating by one-notch is the most likely for both entities, however, a two-notch downgrade cannot be fully excluded. A lowering of credit ratings, in particular to below investment grade level (BB+ or below), would trigger counterparties' rights (mainly in Uniper's Global Commodities business) to demand additional cash or non-cash collateral. In addition, a downgrade could negatively affect access to the capital markets and increase the cost of new financing.

On 17 March 2022, Fitch affirmed its long-term rating for Fortum to BBB, with a stable outlook.

Financial net debt/comparable EBITDA

EUR million	Note 2021	LTM
+ Interest-bearing liabilities	17,220	14,875
- BS Liquid funds	7,592	6,419
- Non-current securities	111	106
- Collateral arrangement securities	549	537
- Securities in interest-bearing receivables	660	643
- BS Margin receivables	9,163	7,441
+ BS Margin liabilities	985	1,864
+/- Net margin liabilities/receivables	-8,179	-5,578
Financial net debt	15 789	2,235
IS Operating profit	-588	-4,349
+ IS Depreciation and amortisation	1,281	1,307
EBITDA	693	-3,042
- IS Items affecting comparability	3,124	5,276
Comparable EBITDA	3,817	2,234
Financial net debt/comparable EBITDA	0.2	1.0

See Note 4 Comparable operating profit and comparable net profit for details on items affecting comparability, and Note 15 Interest-bearing net debt, including further details of the financing and liquidity status.

Key figures

EUR million or as indicated	I/2022	I/2021	2021	LTM
Reported
IS Sales	43,623	21,493	112,400	134,530
IS Operating profit	-2,416	1,345	-588	-4,349
IS Share of profit/loss of associates and joint ventures	-190	80	192	-78
IS Net profit	-2,833	1,310	-114	-4,256
IS Net profit (after non-controlling interests)	-2,222	1,092	739	-2,575
Earnings per share (basic), EUR	-2.50	1.23	0.83	-2.90
CF Net cash from operating activities	-1,529	831	4,970	2,610
Capital expenditure and gross investments in shares, EUR million	174	252	1,407	1,329
Capital expenditure, EUR million	162	228	1,116	1,050
Number of employees	19,260	20,036	19,140
EUR million or as indicated	I/2022	I/2021	2021	LTM
Comparable
EBITDA	-104	1,479	3,817	2,234
IS Operating profit	-438	1,171	2,536	927
Share of profit/loss of associates and joint ventures	26	67	154	113
Net profit (after non-controlling interests)	-99	837	1,778	842
Earnings per share (basic), EUR	-0.11	0.94	2.00	0.95
EUR million		31 Mar 2022 31 Dec 2021		LTM
Financial net debt, EUR million		2,235	789
Adjusted net debt, EUR million		4,454	3,227
Financial net debt/comparable EBITDA			0.2	1.0
Equity per share, EUR		9.05	13.66
Average number of shares, 1,000 shares		888,294	888,294
Diluted adjusted average number of shares, 1,000 shares		888,294	888,294

Number of registered shares, 1,000 shares 888,294 888,294

Notes to the condensed consolidated interim financial statements

1. Significant accounting policies

1.1 Basis of preparation

The unaudited condensed interim financial statements have been prepared in accordance with International Accounting Standard (IAS) 34, Interim Financial Reporting, as adopted by the EU. The condensed interim financial report should be read in conjunction with the consolidated financial statements for the year ended 31 December 2021.

The figures in the consolidated interim financial statements have been rounded and consequently the sum of individual figures may deviate from the sum presented. Key figures have been calculated using exact figures.

Part of Fortum's business operations are seasonal, with the comparable operating profit usually being higher for the first and fourth quarter of the year. Columns labelled as 'LTM' or 'last twelve months' present figures for twelve months preceding the reporting date.

The following symbols show which amounts in the notes reconcile to the items in the income statement, balance sheet and cash flow statement:

IS = Income statement BS = Balance sheet CF = Cash flow

1.2 Alternative performance measures

According to the ESMA Guidelines on Alternative Performance Measures, an Alternative Performance Measure (APM) is understood as a financial measure of historical or future financial performance, financial position, or cash flows, other than a financial measure defined or specified in the applicable financial reporting framework.

Fortum uses APMs, such as Comparable operating profit and Comparable EBITDA, in the financial target setting and forecasting, management's follow-up of financial performance of segments and the Group, as well as for the allocation of resources in the Group's performance management process. Items affecting comparability are excluded from Comparable operating profit and Comparable EBITDA and disclosed separately in Fortum's consolidated income statement to support the transparency of underlying business performance when comparing results between periods. See Note 4 Comparable operating profit and comparable net profit and Note 24 Definitions and reconciliations of key figures.

Fortum's long-term financial target for capital structure is Financial net debt to comparable EBITDA (see Capital risk management and Note 24 Definitions and reconciliations of key figures).

1.3 Accounting policies

The same accounting policies that were applied in the preparation of the consolidated financial statements for the year ended 31 December 2021, have been applied in these condensed interim financial statements. New standards, amendments and interpretations effective from 1 January 2022 have not had a material impact on Fortum's consolidated financial statements.

1.4 Key exchange rates used in consolidated financial statements

The balance sheet date rate is based on the exchange rate published by the European Central Bank for the closing date. The average exchange rate is calculated as an average of daily closing rates from the European Central Bank. The European Central Bank stopped publishing rouble (RUB) rates from 2 March 2022. From 2 March 2022, the daily spot rate at 17:15 EET from the market has been used.

Key exchange rates used in consolidated financial statements:

	Jan-Mar	Jan-Dec	Jan-Sept	Jan-June	Jan-Mar
Average rate	2022	2021	2021	2021	2021
United Kingdom (GBP)	0.8364	0.8596	0.8636	0.8680	0.8739
Norway (NOK)	9.9247	10.1633	10.2280	10.1759	10.2584
Poland (PLN)	4.6230	4.5652	4.5473	4.5374	4.5457
Russia (RUB)	99.1783	87.1527	88.5335	89.5502	89.6675
Sweden (SEK)	10.4807	10.1465	10.1528	10.1308	10.1202
United States (USD)	1.1217	1.1827	1.1962	1.2053	1.2048
	31 Mar	31 Dec	30 Sept	30 June	31 Mar
Balance sheet date rate	2022	2021	2021	2021	2021
United Kingdom (GBP)	0.8460	0.8403	0.8605	0.8581	0.8521
Norway (NOK)	9.7110	9.9888	10.1650	10.1717	9.9955
Poland (PLN)	4.6531	4.5969	4.6197	4.5201	4.6508
Russia (RUB)	91.5833	85.3004	84.3391	86.7725	88.3175
Sweden (SEK)	10.3370	10.2503	10.1683	10.1110	10.2383
United States (USD)	1.1101	1.1326	1.1579	1.1884	1.1725

2. Critical accounting estimates and judgements

The preparation of interim financial statements requires management to make judgements, estimates and assumptions that affect the reported amounts of assets and liabilities, income and expense. Actual results may differ from these estimates. In preparing these interim financial statements, significant judgements made by management in applying the Group's accounting policies and the key sources of estimation uncertainty were the same as those that applied to the consolidated financial statements for the year ended 31 December 2021, except as described below.

Geopolitical uncertainties

On 24 February 2022, Russia started a widespread invasion into Ukraine. Given the uncertainty and risks arising from the geopolitical situation, including imposed sanctions and possible future sanctions and counter sanctions and their consequences, there may be significant impact to the recoverable amounts and economic lives of assets, especially to assets located in or closely related to Russia; as well as on the fair values of derivatives and the related margining requirements in Europe. See also section 'Key drivers and risks'.

The increasing geopolitical tensions could lead to curtailments of physical gas deliveries. The Uniper segment has, amongst others, long-term gas import contracts from Russia. The Uniper segment's long-term gas contracts have been partially fair valued. See Note 5 Financial risk management.

On 14 March 2022, S&P Global Ratings placed Fortum's and Uniper's BBB ratings on credit watch negative. The underlying reasons for the credit watch negative are severe geopolitical tensions and uncertainty following Russia's attack on Ukraine and the risk of possible curtailments of gas supplies from Russia. A lowering of credit ratings would trigger counterparties' rights (mainly in the Uniper segment's Global Commodities business) to demand additional cash or non-cash collateral. See also section 'Capital risk management'.

Due to the sanctions imposed by the Russian Federation, Fortum's Russian subsidiaries are subject to foreign exchange transfer restrictions, which currently limit the transfer of funds, such as potential dividend distributions, into the EU. Accordingly, cash and cash equivalents held by Fortum's Russian subsidiaries in Russia, a total of EUR 242 million, are not available to the other Group companies. The sanctions currently do not, however, restrict Fortum from exercising its voting rights at the general meetings of the Russian subsidiaries (including Uniper's subsidiary Unipro). Hence, Fortum's Russian subsidiaries continue to be classified as subsidiaries at 31 March 2022.

In I/2022, Fortum has assessed the impact of the Russia-Ukraine war and related uncertainties, risks and sanctions to the fair values of its Russian assets and recorded the following impairments:

• Impairments of EUR 1,002 million on non-current Russian assets. See Note 13 Impairment of non-current assets.
• Write-down of EUR 1,003 million financial loan receivable, including accrued interest, related to the Nord Stream 2 pipeline project. See Note 14 Interest-bearing receivables.

In addition, expected credit losses of EUR 86 million were recognised on Russian receivables in I/2022.

The remaining book value of Fortum's Russian assets (net of impairments) was approximately EUR 3.3 billion at 31 March 2022 (31 Dec 2021: 5.5).

3. Segment information

Fortum's reportable segments under IFRS are Generation, Russia, City Solutions, Consumer Solutions and Uniper. Other Operations includes corporate functions, R&D and technology development projects.

The Swedish nuclear subsidiary, OKG Aktiebolag (OKG AB), is split between the Generation segment and the Uniper segment according to ownership.

Quarter

							Consumer				Other
		Generation1)	Russia		City Solutions1)		Solutions		Uniper4)		Operations		Total
EUR million Note	I/2022	I/2021	I/2022	I/2021	I/2022	I/2021	I/2022	I/2021	I/2022	I/2021	I/2022	I/2021	I/2022	I/2021
Income statement data by segment
Power sales 1)	700	627	177	207	50	60	977	574	9,615	5,784	-	-	11,519	7,252
Heat sales		- -	43	56	230	247	-	-	167	100	-	-	439	403
Gas sales		- 37	-	-	-	0	136	57	25,565	11,945	-	-	25,701	12,039
Waste treatment sales		- 0	-	-	61	62	-	-	-	-	-	-	61	62
Other sales	10	11	3	1	50	48	55	31	6,137	1,941	35	34	6,289	2,067
Sales	710	675	223	264	390	418	1,168	661	41,484	19,770	35	34	44,010	21,823
Internal eliminations	129	-63	-1	-1	-6	-12	-14	-3	-20	0	-27	-28	62	-107
Netting of Nord Pool transactions 2)													-448	-223
IS External sales	838	612	222	263	384	406	1,154	659	41,464	19,770	8	6	43,623	21,493
								-
Comparable EBITDA	330	315	92	134	90	132	54	53	-645	868	-25	-23	-104	1,479
IS Depreciation and amortisation	-47	-46	-31	-35	-42	-46	-19	-17	-188	-157	-7	-7	-334	-308
IS Comparable operating profit	282	269	61	100	48	86	35	36	-833	711	-32	-31	-438	1,171
Impairment charges and reversals		- -	-275	-	0	-	-	-	-555	-1	-	-	-830	-1
Capital gains and other related items		0 50	0	0	0	0	0	0	0	1	2	0	3	51
Changes in fair values of derivatives
hedging future cash flow	17	-2	0	0	-14	-1	157	23	-1,267	144	-	0	-1,107	165
Other		0 1	-21	-	1	-	-	-	-15	-41	-10	-	-44	-41
IS Items affecting comparability	4 17	49	-296	0	-12	-1	157	23	-1,836	102	-7	0	-1,978	174
IS Operating profit	299	318	-234	100	36	86	192	59	-2,669	813	-39	-31	-2,416	1,345
Comparable share of profit/loss of
associates and joint ventures 4, 12		3 -5	13	22	4	39	-	-	9	11	-1	-1	26	67
IS Share of profit/loss of associates
and joint ventures	12 -31	8	-159	22	4	39	-	-	-2	11	-1	-1	-190	80
Gross investments / divestments by segment
Gross investments in shares 3)	6	0 0	7	0	0	-	-	-	0	3	6	20	12	23
Capital expenditure 4)	34	27	4	6	25	48	16	11	82	133	1	3	162	228
Gross divestments of shares	6	- 129	0	17	0	0	0	0	6	0	-	0	6	146

1) Sales, both internal and external, include effects from realised hedging contracts. Effect on sales can be negative or positive depending on the difference between average contract price and realised spot price. Power sales contains realised result from commodity derivatives, which have not had hedge accounting status under IFRS 9, but have been considered operatively as hedges.

2) Sales and purchases with Nord Pool Spot are netted on Group level on an hourly basis and posted either as revenue or cost depending on if Fortum is a net seller or net buyer during any particular hour.

3) From I/2022, acquisition of additional shares in Uniper are not included in gross investments in shares. For additional information, see Note 6.1 Acquisitions.

4) Uniper includes effects from Russian operations: Sales EUR 283 million (I/2021: 240), Comparable EBITDA EUR 114 million (I/2021: 76), Comparable operating profit EUR 87 million (I/2021: 54) and Investments EUR 9 million (I/2021: 25).

Last twelve months

								Consumer				Other
		Generation1)		Russia		City Solutions1)		Solutions		Uniper4)		Operations		Total
EUR million	Note	LTM	2021	LTM	2021	LTM	2021	LTM	2021	LTM	2021	LTM	2021	LTM	2021
Income statement data by segment
1) Power sales		2,763	2,690	732	761	194	205	2,656	2,253	32,197	28,365	0	0	38,542	34,274
Heat sales		-	-	123	137	595	612	-	-	504	437	-	-	1,222	1,186
Gas sales		130	167	-	-	0	1	304	225	73,198	59,577	-	-	73,632	59,970
Waste treatment sales		0	0	-	-	249	250	-	-	-	-	-	-	249	250
Other sales		40	42	10	8	237	235	168	144	21,809	17,612	139	138	22,402	18,179
Sales		2,933	2,899	865	906	1,275	1,302	3,129	2,622	127,707	105,992	139	138	136,047	113,860
Internal eliminations		49	-143	-3	-3	-33	-39	-25	-14	-48	-29	-103	-104	-163	-331
Netting of Nord Pool transactions 2)														-1,354	-1,128
IS External sales		2,982	2,756	862	903	1,242	1,264	3,104	2,608	127,659	105,964	36	34	134,530	112,400
Comparable EBITDA		1,314	1,299	361	404	275	317	124	123	276	1,789	-116	-114	2,234	3,817
IS Depreciation and amortisation		-191	-189	-139	-142	-177	-182	-74	-71	-700	-668	-27	-28	-1,307	-1,281
IS Comparable operating profit		1,123	1,110	223	261	97	135	51	52	-424	1,120	-143	-142	927	2,536
Impairment charges and reversals		-	-	-310	-35	0	-	-	-	-601	-48	-	-	-911	-83
Capital gains and other related items		0	50	0	1	2,608	2,608	0	0	8	9	16	14	2,634	2,681
Changes in fair values of derivatives
hedging future cash flow		-88	-107	0	0	-85	-72	576	443	-7,100	-5,688	0	-	-6,696	-5,424
Other		0	1	-21	-	1	-	-	-	-267	-294	-15	-6	-302	-299
IS Items affecting comparability	4	-88	-56	-330	-34	2,524	2,536	576	443	-7,960	-6,021	1	8	-5,276	-3,124
IS Operating profit		1,035	1,054	-107	227	2,622	2,671	627	495	-8,384	-4,901	-142	-134	-4,349	-588
Comparable share of profit/loss of
associates and joint ventures	4, 12	18	11	52	62	7	42	-	-	36	39	-1	0	113	154
IS Share of profit/loss of associates
and joint ventures	12	-3	36	-120	62	7	42	-	-	38	51	-1	0	-78	192
Gross investments / divestments by segment
Gross investments in shares 3)	6	7	7	42	36	1	2	-	-	7	9	223	237	279	290
Capital expenditure 4)		175	168	45	47	138	161	72	68	622	673	13	15	1,050	1,116
Gross divestments of shares	6	0	129	0	18	3,870	3,870	0	0	93	88	19	19	3,982	4,122

1) Sales, both internal and external, include effects from realised hedging contracts. Effect on sales can be negative or positive depending on the difference between average contract price and realised spot price. Power sales contains realised result from commodity derivatives, which have not had hedge accounting status under IFRS 9, but have been considered operatively as hedges.

2) Sales and purchases with Nord Pool Spot are netted on Group level on an hourly basis and posted either as revenue or cost depending on if Fortum is a net seller or net buyer during any particular hour.

3) From I/2022, acquisition of additional shares in Uniper are not included in gross investments in shares. For additional information, see Note 6.1 Acquisitions.

4) Uniper includes effects from Russian operations: Sales EUR 1,053 million (2021: 1,010), Comparable EBITDA EUR 380 million (2021: 342), Comparable operating profit EUR 261 million (2021: 229) and Investments EUR 114 million (2021: 130).

Segment assets and liabilities

								Consumer				Other
		Generation		Russia		City Solutions		Solutions		Uniper1)		Operations		Total
		31 Mar	31 Dec	31 Mar	31 Dec	31 Mar	31 Dec	31 Mar	31 Dec	31 Mar	31 Dec	31 Mar	31 Dec	31 Mar	31 Dec
EUR million	Note	2022	2021	2022	2021	2022	2021	2022	2021	2022	2021	2022	2021	2022	2021
Non-interest-bearing assets		5,718	6,066	1,699	1,923	1,961	2,874	1,468	1,496	26,063	26,616	261	283	37,170	39,258
BS Participations in associates and joint ventures	12	988	1,005	458	678	84	74	-	-	665	671	31	32	2,225	2,461
Eliminations														-354	-386
Total segment assets		6,706	7,071	2,157	2,601	2,044	2,949	1,468	1,496	26,727	27,286	292	315	39,040	41,333
Interest-bearing receivables	14													1,961	3,107
BS Deferred tax assets														3,180	2,149
Other assets														155,824	95,481
BS Liquid funds														6,419	7,592
BS Total assets														206,425	149,661
Segment liabilities		460	735	187	93	365	492	467	371	23,065	22,315	185	190	24,729	24,196
Eliminations														-354	-386
Total segment liabilities														24,375	23,810
BS Deferred tax liabilities														679	827
Other liabilities														157,734	94,140
Total liabilities included in capital employed														182,788	118,777
Interest-bearing liabilities	15													14,875	17,220
BS Total equity														8,762	13,665
BS Total equity and liabilities														206,425	149,661
Number of employees		1,262	1,116	2,744	2,627	1,751	1,766	1,185	1,176	11,319	11,494	999	961	19,260	19,140

1) Uniper includes effects from Russian operations: Segment assets EUR 1,484 million (31 Dec 2021: 2,241) and segment liabilities EUR 107 million (31 Dec 2021: 116).

Comparable operating profit including Comparable share of profits from associates and joint ventures and Comparable return on net assets

		Generation		Russia		City Solutions		Consumer Solutions		Uniper
EUR million	Note	LTM	31 Dec 2021	LTM	31 Dec 2021	LTM	31 Dec 2021	LTM	31 Dec 2021	LTM	31 Dec 2021
Comparable operating profit		1,123	1,110	223	261	97	135	51	52	-424	1,120
Comparable share of profit/loss of associates and joint ventures	4, 12	18	11	52	62	7	42	-	-	36	39
Comparable operating profit including comparable share of profit/loss of associates and joint ventures		1,141	1,121	275	323	104	177	51	52	-387	1,160
Segment assets at the end of the period		6,706	7,071	2,157	2,601	2,044	2,949	1,468	1,496	26,727	27,286
Segment liabilities at the end of the period		460	735	187	93	365	492	467	371	23,065	22,315
Comparable net assets		6,246	6,336	1,970	2,508	1,679	2,456	1,001	1,125	3,662	4,971
Comparable net assets average 1)		6,224	6,221	2,424	2,516	2,515	2,915	833	746	6,267	7,021
Comparable return on net assets, %		18.3	18.0	11.3	12.9	4.1	6.1	6.1	6.9	-6.2	16.5

1) Average net assets are calculated using the opening balance of the financial year and each quarter's closing value.

4. Comparable operating profit and comparable net profit

4.1 Reconciliation of operating profit to comparable operating profit

Quarter

	Unadjusted		Impairment charges and reversals		Capital gains and other related items		Changes in fair values of derivatives hedging future cash flow		Other		Reported
EUR million	I/2022	I/2021	I/2022	I/2021	I/2022	I/2021	I/2022	I/2021	I/2022	I/2021	I/2022	I/2021
Sales	71,121	22,872	-	-	-	-	-27,497	-1,379	-	-	43,623	21,493
Other income	29,442	6,879	-	1	-3	-51	-24,514	-5,161	-86	-2	4,839	1,666
Materials and services	-95,169	-20,935	-	-	-	-	51,556	1,433	-5	11	-43,618	-19,491
Employee benefits	-373	-371	-	-	-	-	-	-	13	-1	-360	-372
Depreciation and
amortisation	-1,164	-308	830	-	-	-	-	-	-	-	-334	-308
Other expenses	-6,273	-6,791	-	-	-	-	1,562	4,942	121	32	-4,589	-1,817
IS Comparable operating profit			830	1	-3	-51	1,107	-165	44	41	-438	1,171
IS Items affecting comparability			-830	-1	3	51	-1,107	165	-44	-41	-1,978	174
IS Operating profit	-2,416	1,345									-2,416	1,345

Last twelve months

	Unadjusted		reversals	Impairment charges and	Capital gains and other related items		cash flow	Changes in fair values of derivatives hedging future	Other		Reported
EUR million	LTM	2021	LTM	2021	LTM	2021	LTM	2021	LTM	2021	LTM	2021
Sales		214,467 166,218	-	-	-	-	-79,935	-53,817	-		- 134,530 112,400
Other income	92,772	70,209	-3	-2	-2,634	-2,682	-74,363	-55,010	-220	-136	15,554	12,380
Materials and services	-291,749 -217,515		-	-	-		- 162,321 112,198		132		148 -129,297 -105,170
Employee benefits	-1,720	-1,718	-	-	-	-	-	-	170	156	-1,549	-1,561
Depreciation and amortisation	-2,220	-1,364	913	83	-	-	-	-	-	-	-1,307	-1,281
Other expenses	-15,901	-16,419	-	-	1	1	-1,326	2,054	220	131	-17,004	-14,232
IS Comparable operating profit	-	-	911	83	-2,634	-2,681	6,696	5,424	302	299	927	2,536
IS Items affecting comparability	-	-	-911	-83	2,634	2,681	-6,696	-5,424	-302	-299	-5,276	-3,124
IS Operating profit	-4,349	-588									-4,349	-588

Impairment charges and reversals

Impairment charges and reversals of previously recognised impairments are adjusted from depreciation and amortisation and presented in items affecting comparability. Impairments in I/2022 include EUR 275 million impairment in the Russia segment, and EUR 555 million impairment in the Uniper segment. See Note 13 Impairment of non-current assets. Impairments in 2021 included EUR 40 million impairment in connection with the sale of the Schkopau lignite power plant in Germany (Uniper segment), and a tax-deductible non-cash impairment of EUR 35 million in connection with the sale of the Argayash CHP plant in Russia (Russia segment).

Capital gains and other related items

Capital gains and other related items in 2021 included EUR 2,350 million gain from the sale of the 50% stake in the Swedish district heating and cooling company, Stockholm Exergi Holding AB, EUR 254 million gain from the sale of the district heating business in the Baltics, and EUR 50 million gain from the sale of eight small hydropower plants in Sweden (see Note 6.2 Disposals).

Changes in fair values of derivatives hedging future cash flow

Unrealised changes in the fair values of financial derivative instruments hedging future cash flows that do not qualify for hedge accounting, and physical contracts that are treated as derivatives, are recognised in items affecting comparability.

Impacts from settlement of physical contracts that have been treated as derivatives are adjusted to sales and materials and services to reflect the contract pricing as opposed to market pricing ("contract pricing adjustment"). Adjustments are needed to improve the understanding of the financial performance when comparing results from one period to another.

Other

Other includes mainly restructuring expenses, adjustments to certain provisions and reversals of temporary reductions in current assets.

4.2 Reconciliation from operating profit to comparable net profit

EUR million	Note	I/2022	I/2021	2021	LTM
IS Operating profit		-2,416	1,345	-588	-4,349
IS Items affecting comparability	4.1	1,978	-174	3,124	5,276
IS Comparable operating profit		-438	1,171	2,536	927
IS Share of profit/loss of associates and joint ventures		-190	80	192	-78
Adjustments to share of profit/loss of associates and joint ventures	12	216	-13	-38	191
Comparable share of profit/loss of associates and joint ventures		26	67	154	113
IS Finance costs - net		-956	36	107	-884
Adjustments to finance costs - net	7	1,090	-17	-146	961
Comparable finance costs - net		135	19	-38	77
Comparable profit before income tax		-277	1,257	2,651	1,116
IS Income tax expense		728	-150	175	1,054
Adjustments to income tax expense		-654	-110	-780	-1,325
Comparable income tax expense		74	-260	-605	-270
IS Non-controlling interests		610	-218	852	1,681
Adjustments to non-controlling interests		-507	57	-1,121	-1,685
Comparable non-controlling interests		104	-161	-268	-4
Comparable net profit		-99	837	1,778	842
Comparable earnings per share, EUR	24	-0.11	0.94	2.00	0.95

Comparable share of profit/loss of associates and joint ventures

Share of profit/loss of associates and joint ventures is adjusted for significant items, similar to adjustments made to arriving at comparable net profit, in those entities that are classified as Fortum's principal associates and joint ventures. For more information on Fortum's principal associates and joint ventures, see Note 18 Participations in associated companies and joint ventures in the 2021 consolidated financial statements. In I/2022, the share of profits of associates and joint ventures include EUR 150 million impairments related to Fortum's ownership in the Russian TGC-1 and EUR 22 million of impairments of the renewables joint ventures in Russia. See Note 13 Impairment of noncurrent assets.

Comparable finance costs - net

Finance costs – net are adjusted for e.g. nuclear-related items recognised in other financial items - net, fair value changes on financial items, as well as impairment charges and reversals of previously recorded impairment charges on financial items. In I/2022, the amount includes EUR 1,003 million impairment of a financial loan receivable, including accrued interest, related to the Nord Stream 2 pipeline project.

Comparable income tax expense

Income tax expense is adjusted for tax impacts on items affecting comparability, adjustments to finance costs – net, tax rate changes and other onetime adjustments.

See also Note 24 Definitions and reconciliations of key figures.

5. Financial risk management

Fortum continues discussions with Uniper and reviews its risk management systems and policies for the combined Group. See Fortum Group's consolidated financial statements for the year ended 31 December 2021 for current financial risk management objectives and policies.

Fair value hierarchy information

Financial instruments that are measured in the balance sheet at fair value are presented according to following fair value measurement hierarchy:

Level 1: quoted prices (unadjusted) in active markets for identical assets or liabilities;

Level 2: inputs other than quoted prices included within Level 1 that are observable for the asset or liability, either directly (i.e. as prices) or indirectly (i.e. derived from prices);

Level 3: inputs for the asset or liability that is not based on observable market data (unobservable inputs).

See also accounting policies in the consolidated financial statements 2021, in Note 15 Financial assets and liabilities by fair value hierarchy.

Financial assets

	Level 1		Level 2		Level 3		Netting 1)		Total
EUR million	31 Mar 2022	31 Dec 2021	31 Mar 2022	31 Dec 2021	31 Mar 2022	31 Dec 2021	31 Mar 2022	31 Dec 2021	31 Mar 2022	31 Dec 2021
In non-current assets
Other investments 2)	67	71	43	46	108	99			218	216
Derivative financial instruments
Commodity derivatives
Hedge accounting			1	62				-9	1	53
Non-hedge accounting	10,483	5,136	24,477	11,708	3,209	207	-32	-96	38,137	16,955
Interest rate and currency derivatives
Hedge accounting			40	54					40	54
Non-hedge accounting			40	34					40	34
Interest-bearing receivables	106	111			23	36			128	147
Total in non-current assets	10,656	5,318	24,600	11,904	3,340	342	-32	-105	38,563	17,460
In current assets
Derivative financial instruments
Commodity derivatives
Hedge accounting	675	50	742	572			-382	-207	1,035	416
Non-hedge accounting	45,352	22,876	60,024	45,575	5,029	326	-6,256	-4,028	104,149	64,750
Interest rate and currency
derivatives
Hedge accounting			66	57					66	57
Non-hedge accounting			343	170					343	170
Other receivables			11	13					11	13
Interest-bearing receivables	591	596			4	4			594	600
Total in current assets	46,618	23,522	61,186	46,387	5,033	330	-6,638	-4,235	106,199	66,006
Total in assets	57,273	28,840	85,786	58,291	8,372	672	-6,670	-4,340	144,762	83,465

1) Receivables and liabilities from electricity and other commodity standard derivative contracts against exchanges with same delivery period are netted in Fortum, except in Uniper-segment.

2) Other investments mainly include shares in unlisted companies.

Financial liabilities

	Level 1		Level 2		Level 3		Netting 1)		Total
EUR million	31 Mar 2022	31 Dec 2021	31 Mar 2022	31 Dec 2021	31 Mar 2022	31 Dec 2021	31 Mar 2022	31 Dec 2021	31 Mar 2022	31 Dec 2021
In non-current liabilities
Interest-bearing liabilities 2)			1,483	1,669					1,483	1,669
Derivative financial instruments
Commodity derivatives
Hedge accounting			5	257				-9	5	248
Non-hedge accounting	7,179	4,874	25,330	11,336	324	259	-32	-96	32,801	16,373
Interest rate and currency derivatives
Hedge accounting			40	27					40	27
Non-hedge accounting			8	8					8	8
Total in non-current liabilities	7,179	4,874	26,866	13,297	324	259	-32	-105	34,336	18,326
In current liabilities
Interest-bearing liabilities			537	549					537	549
Derivative financial instruments
Commodity derivatives
Hedge accounting	2,462	420	2,873	2,721			-382	-207	4,952	2,934
Non-hedge accounting	42,876	20,316	75,420	52,531	102	86	-6,256	-4,028	112,142	68,905
Interest rate and currency derivatives
Hedge accounting			19	4					19	4
Non-hedge accounting			112	103					112	103
Total in current liabilities	45,338	20,736	78,961	55,908	102	86	-6,638	-4,235	117,762	72,496
Total in liabilities	52,517	25,610	105,827	69,205	426	345	-6,670	-4,340	152,098	90,822

1) Receivables and liabilities from standard electricity and other commodity derivative contracts against exchanges with same delivery period are netted in Fortum,

except in Uniper-segment. 2) Fair valued part of bonds when hedge accounting is applied (fair value hedge).

At the end of March 2022, the net fair value of commodity derivatives was EUR -6,485 million, including assets of EUR 143 billion and liabilities of EUR 150 billion (EUR -6,225 million in December 2021, including assets of EUR 82 billion and liabilities of EUR 88 billion). The increase from December 2021 mainly relates to derivative financial instruments in the Uniper segment resulting from increased market prices for commodities.

Net fair value amount of interest rate and currency derivatives was EUR 310 million, including assets of EUR 488 million and liabilities of EUR 178 million. Fortum has cash collaterals based on collateral agreements with some counterparties. At the end of March 2022, Fortum had received EUR 260 million from collateral agreements. The received cash was booked as a short-term liability.

Regarding derivative financial instruments, see Note 4 Comparable operating profit and comparable net profit and Note 17 Other provisions. Regarding the interest-bearing receivables and liabilities, see Note 14 Interest-bearing receivables, Note 15 Interest-bearing net debt and Note 20 Pledged assets and contingent liabilities.

Commodity derivatives, fair values of EUR 7.4 billion, have been transferred from level 2 to level 3 in the fair value hierarchy because certain input factors that are necessary to calculate the credit value adjustment according to IFRS 13 became illiquid during I/2022. There were no transfers out of level 3.

Changes in fair value hierarchy Level 3

	1 Jan 2022	Purchases	Sales	Settle ments	Gains / losses in income statement	Transfers into level 3	Gains / losses in OCI	31 Mar 2022
On balance sheet, net
Other investments	99	6	-17		19		1	108
Commodity derivatives, fair values	764		2		245	7,378		8,389
Commodity derivative, day-1 gains and
losses	-575	-4			2			-577
Interest-bearing receivables	40			-4	-10			26
Total on balance sheet, net	328	2	-15	-4	256	7,378	1	7,946

6. Acquisitions, disposals and assets held for sale

6.1 Acquisitions

EUR million	I/2022	I/2021	2021	LTM
Gross investments in shares in subsidiary companies	3	19	210	195
Gross investments in shares in associated companies and joint ventures	3	1	44	46
Gross investments in other shares	6	3	36	38
Total	12	23	290	279

There were no material acquisitions in I/2022. Acquisition of subsidiary shares in 2021 mainly relate to the acquisition of Uniper shares. From I/2022, acquisition of additional shares in Uniper are not included in gross investments in shares. This reflects the change in presentation in the cash flow where the acquisition of additional shares are from I/2022 presented in cash flow from financing activities to better reflect the requirements of IAS 7 Statement of cash flows. Until IV/2021 acquisition of additional shares in Uniper were presented in cash flow from investing activities. Comparatives have not been restated.

6.2 Disposals

EUR million	I/2022	I/2021	2021	LTM
Gross divestments of shares in subsidiary companies	0	146	1,196	1,051
Gross divestments of shares in associated companies and joint ventures	0	0	2,898	2,898
Gross divestments of other investments	6	-	28	34
Total	6	146	4,122	3,982

Disposals during 2022

There were no material divestments in I/2022.

Disposals during 2021

On 22 June 2021, Fortum announced that it had signed an agreement to divest the 250-MW Pavagada II and the 250- MW Rajasthan solar power plants in India to Actis. The total consideration from the divestment on a debt and cashfree basis, including the effect of deconsolidating of the net debt amounted to approximately EUR 280 million. The sale of Pavagada II was concluded in October 2021 and the first phase of Rajasthan divestment in November 2021. Fortum recorded a tax-exempt sales gain of EUR 11 million in the forth quarter 2021 comparable operating profit of the City Solutions segment.

In February 2020, Uniper signed an agreement with Saale Energie GmbH, a subsidiary of the Czech company Energetický a průmyslový holding, a. s., on the sale of the interest in the Schkopau lignite-fired power plant in Germany. Uniper is the operator of the power plant and holds a stake of about 58%. Saale Energie holds a stake of around 42% in the Schkopau power plant and took over Uniper's stake effective 1 October 2021.

On 20 September 2021, Fortum concluded the sale of its 50% ownership in the Swedish district heating and cooling company Stockholm Exergi Holding AB (publ) to a consortium of European institutional investors of APG, Alecta, PGGM, Keva, and AXA. The total consideration of the sale amounted to SEK 29.5 billion (approximately EUR 2.9 billion). Fortum recorded a tax-exempt capital gain of EUR 2,350 million in the City Solutions segment's third-quarter 2021 results.

On 12 March 2021, Fortum announced that it had signed an agreement to sell its district heating business in the Baltics to Partners Group. On 2 July 2021, Fortum concluded the sale. The total consideration of the sale amounted to approximately EUR 710 million. Fortum recorded a tax-exempt capital gain of EUR 254 million in the City Solutions segment's third-quarter 2021 results.

On 2 March 2021, Fortum announced it had decided to construct the largest solar power plant in Russia through a joint venture established with RDIF. In December 2021, 78 MW of the capacity was commissioned and the remaining capacity will be commissioned in the second half of 2022. The power plant is based on capacities won by Fortum in CSA auctions in 2018 and 2019. In March 2021, Fortum sold the CSA-backed solar power project to the joint venture

with RDIF, which had a positive effect of EUR 17 million in the first quarter 2021 comparable operating profit of the Russia segment.

In December 2020, Fortum decided to sell eight small hydropower plants in Sweden with an average annual power generation of 0.1 TWh to Downing Renewables & Infrastructure Trust plc. The total purchase price on a debt and cash free basis is EUR 64.5 million. The transaction closed on 2 February 2021.

In December 2019, Fortum and Credit Suisse Energy Infrastructure Partners (CSEIP) signed an agreement whereby funds advised by CSEIP acquired an 80% stake in Fortum's Nordic wind portfolio. The transaction, excluding the Sørfjord wind park, which was still under construction, was closed on 14 May 2020. The transaction on Sørfjord wind park was closed on 20 January 2021.

6.3 Assets held for sale

Assets held for sale at 31 March 2022 include the 50% ownership in the district heating company Fortum Oslo Varme AS in Norway (City Solutions segment), the equity investment in Javelin, UK (Uniper segment), and the Öresundverket power plant in Malmö, Sweden (Uniper segment). Assets held for sale at 31 December 2021 included equity investment in Javelin, UK (Uniper segment), and the Öresundverket power plant in Malmö, Sweden (Uniper segment).

On 22 March 2022, Fortum announced that it had signed an agreement to sell its 50% ownership in the district heating company Fortum Oslo Varme AS in Norway to an investor consortium comprising Hafslund Eco, Infranode and HitecVision. The total consideration for Fortum's share is approximately EUR 1 billion on a cash and debt free basis and as part of the transaction, Fortum will deconsolidate a related EUR 210 million loan from the City of Oslo. Fortum expects to record a tax-exempt capital gain of approximately EUR 0.6 billion in the City Solutions segment's results in connection with closing of the transaction. The closing of the transactions is expected during the second quarter of 2022.

EUR million	31 Mar 2022	31 Dec 2021
Assets held for sale
Intangible assets and property, plant and equipment and right-of-use assets	789	25
Other non-current and current assets	166	83
Liquid funds	1	-
BS Total	956	108
Liabilities related to assets held for sale
Interest-bearing liabilities	223	-
Deferred tax liabilities	51	-
Pension and asset retirement obligations	5	-
Other liabilities and provisions	80	-
BS Total	360	-

7. Finance costs - net

EUR million	I/2022	I/2021	2021	LTM
Interest expense
Borrowings	-51	-45	-170	-177
Leasing and other interest expenses	-18	-11	-49	-55
Capitalised borrowing costs	2	9	16	8
IS Total	-68	-47	-202	-223
Interest income
Loan receivables and deposits	6	31	135	111
Leasing and other interest income	19	6	21	34
IS Total	26	37	156	145
Other financial items - net
Return from nuclear funds, nuclear fund adjustment and unwinding of nuclear
provisions	-98	12	146	37
Fair value changes, impairments and reversals	-1,017	5	-1	-1,022
Unwinding of discounts on other provisions and pension obligations	93	25	3	71
Other financial expenses and income	108	4	5	109
IS Total	-914	46	154	-806
IS Finance costs - net	-956	36	107	-884
EUR million	I/2022	I/2021	2021	LTM
IS Finance costs - net Adjustments to finance costs - net	-956	36	107	-884
Return from nuclear funds, nuclear fund adjustment and unwinding of nuclear
provisions	98	-12	-146	-37
Fair value changes, impairments and other reversals	992	-5	1	998
Comparable finance costs - net	135	19	-38	77

Interest expenses on borrowings in I/2022 totalled EUR 51 million (I/2021: 45) including interest expenses on loans of EUR 42 million (I/2021: 41), and EUR 9 million (I/2021: 4) interest cost – net from derivatives hedging the loan portfolio. Interest expenses from leases were EUR 7 million (I/2021: 11) and other interest expenses were EUR 11 million (I/2021: 0).

Interest income in I/2022 of EUR 26 million (I/2021: 37) includes EUR 9 million (I/2021: 29) interest income from shareholder loan receivables and other loan receivables, and EUR -3 million (I/2021: 2) from deposits. Interest income from leases was EUR 3 million (I/2021: 5) and other interest income was EUR 16 million (I/2021: 1).

Return from Nuclear Funds include interest income from the Finnish Nuclear waste fund and changes in fair values in the Swedish Nuclear waste fund. The change between I/2022 and I/2021 in unwinding of discount on other provisions and pension obligations comes mainly from a positive effect of changes in discount rates on other provisions in the Uniper segment.

Fair value changes, impairments and reversals in I/2022 include EUR 1,003 million write down of financial loan receivable, including accrued interest, related to the Nord Stream 2 pipeline project.

8. Income taxes

Income taxes during I/2022 totalled EUR 728 million (tax income) (I/2021: -150 tax expense). The effective income tax rate according to the income statement was 20.5% (I/2021: 10.3%). The comparable effective income tax rate was 24.5% (I/2021: 21.9%).

Fortum has paid taxes in previous years regarding ongoing tax disputes. The appeal processes are ongoing and based on legal analysis and legal opinions the payments are booked as a receivable, EUR 113 million (31 Dec 2021: 113), included in Income tax receivables. For additional information see Note 21 Legal actions and official proceedings.

9. Dividend per share

A dividend for 2021 of EUR 1.14 per share, amounting to a total of EUR 1,013 million, was decided in the Annual General Meeting on 28 March 2022. The dividend was paid on 6 April 2022 and is recorded as a liability in these interim financial statements in Trade and other payables.

A dividend for 2020 of EUR 1.12 per share, amounting to a total of EUR 995 million, was decided in the Annual General Meeting on 28 April 2021. The dividend was paid on 7 May 2021.

10. Intangible assets

EUR million	31 Mar 2022	31 Dec 2021
Goodwill	816	1,021
Contract-based	502	514
Other	636	632
BS Total	1,954	2,167

Change in goodwill in I/2022 mainly relates to EUR 124 million impairment charge (see Note 13 Impairment of noncurrent assets), transfer to assets held for sale, as well as translation differences.

11. Property, plant and equipment, and right-of-use assets

Property, plant and equipment, and right-of-use assets amounted to EUR 17,111 million (31 Dec 2021: 19,049). Changes in I/2022 mainly relate to EUR 701 million impairment charge (see Note 13 Impairment of non-current assets), as well as transfer to assets held for sale, depreciation, and translation differences; partly offset by capital expenditures.

12. Participations in associates and joint ventures

12.1 Participations in associates and joint ventures

Changes in participations in associates and joint ventures

EUR million	31 Mar 2022	31 Dec 2021
Opening balance 1 January	2,461	2,912
Investments	3	44
Share of profit of associates and joint ventures	-190	192
Dividend income received	-2	-113
Divestments and capital returns 1)	0	-569
Reclassifications	-5	-58
OCI items in associates and joint ventures	23	38
Translation differences and other adjustments	-66	14
BS Closing balance	2,225	2,461

1) Divestments and capital returns in 2021 mainly related to the sale of Stockholm Exergi AB, for additional information see Note 6.2 Disposals.

In I/2022, the share of profits of associates and joint ventures include EUR 150 million impairments related to Fortum's ownership in the Russian TGC-1 and EUR 22 million of impairments of the renewables joint ventures in Russia. See Note 13 Impairment of non-current assets.

12.2 Share of profit/loss of associates and joint ventures

EUR million	I/2022	I/2021	2021	LTM
TGC-1	-150	8	33	-125
Stockholm Exergi AB	-	34	28	-6
Other associates and joint ventures	-40	38	131	53
IS Share of profit/loss of associates and joint ventures	-190	80	192	-78

EUR million	I/2022	I/2021	2021	LTM
IS Share of profit/loss of associates and joint ventures	-190	80	192	-78
Adjustments to share of profit/loss of associates and joint ventures	216	-13	-38	191
Comparable share of profit/loss of associates and joint ventures	26	67	154	113

13. Impairment of non-current assets

The carrying values of goodwill, other intangible assets, property, plant and equipment, right-of-use assets, participations in associates and joint ventures, and non-financial investments are reviewed regularly for indication of impairment. Impairment testing is performed if there is an indication of impairment; and the asset is written down to its recoverable amount if its carrying amount is greater than the estimated recoverable amount. See Note 19 Impairment testing in the 2021 consolidated financial statements for further information on the accounting policy and assumptions related to impairment testing.

On 24 February 2022, Russia started a widespread invasion into Ukraine. As a consequence, the US, the EU and the UK, amongst others, imposed sanctions targeting Russia's ability to access capital and financial markets, sanctioning numerous individuals and banks; as well as trading in general. The war, the resulting sanctions, and the impact on trading is considered as an impairment indicator, which triggered impairment testing on the Russia and the Unipro cash-generating units (CGU) at 31 March 2022.

For goodwill, other intangible assets, property, plant and equipment, and right-of-use assets, Fortum uses value in use to establish the recoverable amount of CGUs. Value in use is determined by discounting future cash flows expected to be derived from group of assets. In order to reflect the uncertainty related to the Russia-Ukraine geopolitical uncertainties at 31 March 2022, Fortum is using the expected cash flow approach with three different probabilityweighted cash flow scenarios prepared by the management: the base scenario with 40% weighting, as well as two

different downside scenarios, each with 30% weighting. Cash flows used for annual impairment testing at the previous year end were based on the most likely scenario. In addition, Fortum updated the discount rate for Russia CGUs. Discount rate from 11% to 31% is applied on a reducing scale over the cash flow period, with higher discount rate in the first three years (31 Dec 2021: 11.7%).

The recoverable amount of the Russian associate TCG-1 is based on fair value less costs of disposal using two different probability-weighted scenarios prepared by the management. The scenarios are consistent with external sources of information, the recoverable amount corresponding to fair value hierarchy level 3.

The recoverable amounts of the Russia (Russia segment) and Unipro (Uniper segment) CGUs were below the respective book values resulting in EUR 447 million impairment charge in the Russia CGU, and EUR 555 million impairment charge in the Unipro CGU in I/2022. Russia CGU's impairment was recognised against goodwill, property, plant and equipment and participations in associates and joint ventures; and Unipro CGU's impairment against property, plant and equipment. The remaining book value of Fortum's Russian assets (net of impairments) was approximately EUR 3.3 billion at 31 March 2022 (31 Dec 2021: 5.5).

14. Interest-bearing receivables

EUR million	31 Mar 2022	31 Dec 2021
Interest-bearing receivables	1,828	2,971
Finance lease receivables	133	136
Total	1,961	3,107

	Carrying amount	Fair value	Carrying amount	Fair value
EUR million	31 Mar 2022	31 Mar 2022	31 Dec 2021	31 Dec 2021
Long-term loan receivables from associates and joint ventures	1,039	1,077	1,138	1,185
Non-current securities	106	106	111	111
Other long-term interest-bearing receivables	60	59	1,024	1,024
Total long-term interest-bearing receivables	1,204	1,242	2,273	2,320
Collateral arrangement securities	537	537	549	549
Other short-term interest-bearing receivables	87	87	149	149
Total short-term interest-bearing receivables	624	624	698	698
Total	1,828	1,865	2,971	3,018

Long-term interest-bearing receivables from associated companies and joint ventures, EUR 1,039 million (31 Dec 2021: 1,138), include EUR 849 million from Swedish nuclear companies, Forsmarks Kraftgrupp AB and Ringhals AB (31 Dec 2021: 955), which are mainly funded with shareholder loans, pro rata to each shareholder's ownership.

The decrease in Other long-term interest-bearing receivables from 31 December 2021 is mainly due to EUR 1,003 million write down of a financial loan receivable, including accrued interest, related to the Nord Stream 2 pipeline project.

15. Interest-bearing net debt

Financial net debt and adjusted net debt

EUR million	31 Mar 2022	31 Dec 2021
+ Interest-bearing liabilities	14,875	17,220
- BS Liquid funds	6,419	7,592
- Non-current securities	106	111
- Collateral arrangement securities	537	549
- Securities in interest-bearing receivables	643	660
- BS Margin receivables	7,441	9,163
+ BS Margin liabilities	1,864	985
+/- Net margin liabilities/receivables	-5,578	-8,179
Financial net debt	2,235	789
+ BS Pension obligations	931	1,190
+ Other asset retirement obligations	848	872
- BS Share of Finnish and Swedish Nuclear Waste Funds	3,399	3,515
+ BS Nuclear provisions	3,840	3,891
+ Nuclear provisions net of assets in Nuclear Waste Funds	441	375
+ Total provisions net of assets in Nuclear Waste Funds	2,219	2,438
Adjusted net debt	4,454	3,227

Financial net debt increased during the quarter by EUR 1,446 million from EUR 789 million to EUR 2,235 million in March 2022. Liquid funds decreased by EUR 1,173 million from EUR 7,592 million to EUR 6,419 million in March 2022. Net margin receivables decreased by EUR 2,601 million from EUR 8,179 million to EUR 5,578 million in March 2022. Interest-bearing liabilities decreased by EUR 2,345 million from EUR 17,220 million to EUR 14,875 million in March 2022.

Fortum has a collateral arrangement to release cash from the Nordic Power Exchange. This arrangement is presented with equal amounts, EUR 537 million (31 Dec 2021: 549), as a short-term interest-bearing liability and an interestbearing receivable.

Underfunded pension obligations and asset retirement obligations, net of share in nuclear waste funds, are included in adjusted net debt.

Interest-bearing liabilities

EUR million	31 Mar 2022	31 Dec 2021
Non-current loans	6,112	7,756
Current loans	7,727	8,389
Total loans	13,838	16,144
Non-current lease liabilities	914	945
Current lease liabilities	123	130
Total lease liabilities	1,036	1,075
Total	14,875	17,220

Loans

	Carrying amount	Fair value	Carrying amount	Fair value
EUR million	31 Mar 2022	31 Mar 2022	31 Dec 2021	31 Dec 2021
Bonds	3,669	3,659	3,705	3,919
Loans from financial institutions	4,179	4,215	4,183	4,222
Reborrowing from the Finnish State Nuclear Waste Management Fund 1)	918	999	1,165	1,213
Other long-term interest-bearing liabilities	213	248	433	463
Total long-term loans 2)	8,978	9,120	9,487	9,817
Collateral arrangement liability	537	537	549	549
Other short-term interest-bearing liabilities	4,323	4,323	6,109	6,109
Total short-term loans	4,860	4,860	6,658	6,658
Total	13,838	13,981	16,144	16,475

1) The reborrowing from the Finnish State Nuclear Waste Management Fund includes the part relating to Loviisa nuclear power plant as well as borrowing done through TVO.

2) Includes current portion of long-term liabilities of EUR 2,866 million (31 Dec 2021: 1,731).

In January 2022, Fortum repaid the drawn amount of EUR 500 million of its EUR 800 million revolving credit facility. In March 2022, Fortum repaid EUR 247 million of the nuclear waste fund loans totalling EUR 918 million after the repayment.

Current loans, EUR 7,727 million (31 Dec 2021: 8,389), include the current portion of long-term loans, EUR 2,866 million (31 Dec 2021: 1,731), and short-term loans, EUR 4,860 million (31 Dec 2021: 6,658).

Current portion of long-term loans, EUR 2,866 million, consist of EUR 1,000 million bond maturing in September 2022 and EUR 1,000 million bond maturing in February 2023, EUR 450 million term loan maturing in October 2022, and EUR 416 million other loans.

Short-term loans have decreased by EUR 1,798 million, from EUR 6,658 million on 31 December 2021 to EUR 4,860 million on 31 March 2022. The use of commercial paper programmes decreased by EUR 1,274 million to EUR 1,855 million.

The average interest rate for the portfolio of EUR loans was 0.7% at the balance sheet date (31 Dec 2021: 0.6%). The average interest rate on total loans and derivatives was 1.0% at the balance sheet date (31 Dec 2021: 1.3%).

Maturity of loans

EUR million	31 Mar 2022
2022	6,324
2023	3,844
2024	867
2025	18
2026	757
2027 and later	2,028
Total	13,838

Loans maturing in 2022 include EUR 1,855 million commercial papers, EUR 1,800 million drawn amount of the revolving credit facility and EUR 1,468 million current portion of long-term loans. Maturities in 2022 also include EUR 829 million loans with no contractual due date.

Maturity of undiscounted lease liabilities

EUR million	31 Mar 2022
Due within a year	124
Due after one year and within five years	433
Due after five years	762
Total	1,319

Liquid funds

EUR million	31 Mar 2022	31 Dec 2021
Deposits and securities with maturity more than 3 months	53	47
Cash and cash equivalents	6,366	7,545
BS Total	6,419	7,592

At the end of the reporting period, the Group's liquid funds totalled EUR 6,419 million (31 Dec 2021: 7,592). Liquid funds include EUR 3,897 million held by the Uniper segment (31 Dec 2021: 2,966). Russian subsidiaries held EUR 242 million (31 Dec 2021: 300) of liquid funds in the form of cash and bank deposits.

Liquid funds totalling EUR 6,046 million (31 Dec 2021: 7,342) are placed with counterparties that have an investment grade credit rating.

Payment transactions with the Russian Federation are subject to general restrictions as of 31 March 2022. Accordingly, cash and cash equivalents held by Fortum's Russian subsidiaries in Russia, a total of EUR 242 million, are not available to the other Group companies.

Committed credit facilities

At the end of the first quarter, Fortum had undrawn committed credit facilities amounting to EUR 5,800 million. The undrawn facilities include committed revolving facilities of EUR 3,800 million, of which EUR 3,000 million matures in July 2022, and EUR 800 million which matures in December 2022 (with an extension option of one year). Uniper's committed revolving credit facility of EUR 2,000 million matures in April 2023. In addition to the revolving credit facilities, Fortum has EUR 100 million committed overdraft limits that are valid until further notice.

The EUR 1,750 million revolving credit facility with maturity in June 2023 and Uniper's revolving credit facility of EUR 1,800 million with maturity in September 2025 were both totally in use in March 2022.

16. Nuclear-related assets and liabilities

Fortum owns Loviisa nuclear power plant in Finland, OKG Aktiebolag (OKG) and Barsebäck Kraft AB (Barsebäck) nuclear power companies in Sweden.

On Fortum's consolidated balance sheet, Share in the Nuclear Waste Fund and the Nuclear provisions relate to Loviisa, OKG and Barsebäck nuclear power plants. Fortum also has minority interests in other nuclear power companies, i.e. Teollisuuden Voima Oyj (TVO) in Finland and Forsmarks Kraftgrupp AB (Forsmark) in Sweden. The minority shareholdings are classified as associated companies and joint ventures and are consolidated with equity method. Both the Finnish and the Swedish companies are non-profit making, i.e. electricity production is invoiced to the owners at cost according to local GAAP.

In Finland and Sweden nuclear operators are legally obligated for the decommissioning of the plants and the disposal of spent fuel (nuclear waste management). In both countries, the nuclear operators are obligated to secure the funding of nuclear waste management by paying to government managed nuclear waste funds. The nuclear operators also have to give securities to guarantee that sufficient funds exist to cover future expenses of decommissioning of the power plant and the disposal of spent fuel.

16.1 Nuclear-related assets and liabilities for consolidated nuclear power plants

EUR million	31 Mar 2022	31 Dec 2021
Carrying values on the balance sheet
BS Nuclear provisions	3,840	3,891
BS Fortum's share of the Nuclear Waste Funds	3,399	3,515
Fortum's share of the fair value of the net assets in the Nuclear Waste Funds in Finland and Sweden	3,820	3,924
Share of fund not recognised on the balance sheet	421	408

Nuclear provision and fund accounted for according to IFRS

Nuclear provisions include the provision for the decommissioning and the provision for the disposal of spent fuel. Provisions are based on the total cost estimate in which future costs are discounted to net present value.

The carrying value of nuclear provisions, calculated according to IAS 37, decreased by EUR 51 million compared to 31 December 2021, totalling EUR 3,840 million at 31 March 2022.

Fortum's share of the Nuclear Waste Funds are from an IFRS perspective overfunded by EUR 421 million, since Fortum's share of the Funds on 31 March 2022 was EUR 3,820 million and the carrying value on the balance sheet was EUR 3,399 million. The Fund on Fortum's balance sheet can at maximum be equal to the amount of the provisions according to IFRS. As long as the Fund is overfunded from an IFRS perspective, other financial items are adjusted positively if the provisions increase more than the Fund, and negatively if the provision decreases below the actual value of the fund.

Legal liability for Loviisa nuclear power plant

The legal liability on 31 March 2022, decided by the Ministry of Economic Affairs and Employment in December 2021, was EUR 1,148 million.

The legal liability is based on a cost estimate, which is updated every year; and a technical plan, which is updated every three years. The legal liability is determined by assuming that the decommissioning would start at the beginning of the year following the assessment year and discounting is not applied in determining the amount.

Fortum's share in the Finnish Nuclear Waste Management Fund

According to the Nuclear Energy Act, Fortum is obligated to contribute funds in full to the State Nuclear Waste Management Fund to cover the legal liability. Fortum contributes funds to the Finnish State Nuclear Waste Management Fund based on the yearly funding obligation target decided by the governmental authorities in connection with the decision of size of the legal liability. The current funding obligation target decided in December 2021 is EUR 1,148 million.

Borrowing from the State Nuclear Waste Management Fund

Participants in the Finnish State Nuclear Waste Management Fund are allowed to borrow from the fund according to certain rules. Fortum uses the right to borrow back and has pledged shares in Kemijoki Oy as security for the loans. The loans are renewed annually. See Note 15 Interest-bearing net debt and Note 20 Pledged assets and contingent liabilities.

OKG and Barsebäck nuclear power plants in Sweden

In Sweden, Svensk Kärnbränslehantering AB (SKB), a company owned by the nuclear operators, takes care of all nuclear waste management-related activities on behalf of nuclear operators. SKB receives its funding from the Swedish Nuclear Waste Fund, which in turn is financed by the nuclear operators.

Nuclear waste fees and guarantees are normally updated every three years by governmental decision after a proposal from the Swedish Radiation Safety Authority (SSM). From September 2018, the proposal is prepared by the National Debt Office. The proposal is based on cost estimates done by SKB and the license holders. An updated technical plan

for nuclear waste management was decided by SKB in September 2019 and was handed in to SSM in the end of 2019. In December 2020, the Swedish government decided the waste fees and guarantees for year 2021 only, and in January 2022 for 2022-2023. Nuclear waste fees paid by licensees with a unit/units that are still in operation are currently based on future costs with the assumed lifetime of 50 years for each unit of a nuclear power plant. The fee is calculated in relation to the energy delivered and set as an amount of öre (1 öre = SEK 0.01) per kWh delivered. For Barsebäck, which have no units in operation, the fee is determined as a fixed fee in SEK per year.

16.2 Nuclear power plants in associated companies and joint ventures

Forsmark and TVO are non-profit making companies, i.e. electricity production is invoiced to the owners at cost. Invoiced cost is accounted according to local GAAP. In addition to the invoiced electricity production cost, Fortum makes IFRS adjustments to comply with Fortum's accounting principles. These adjustments include also Fortum's share of the companies' nuclear waste funds and nuclear provisions.

The tables below present the 100% figures relating to nuclear funds and provisions for the companies as well as Fortum's net share.

Nuclear-related assets and liabilities relating to associated companies (100%)

	31 Mar 2022	31 Dec 2021
Carrying values with Fortum assumptions
Nuclear provisions	4,319	4,347
Share of the Nuclear Waste Fund	3,413	3,556
of which Fortum's net share consolidated with equity method	-251	-215
Fortum's share of the fair value of the net assets in the Nuclear Waste Funds	1,105	1,150

TVO's legal liability, provision and share of the fund are based on same principles as described above for Loviisa nuclear power plant.

Participants in the Finnish State Nuclear Waste Management Fund are allowed to borrow from the fund according to certain rules. Fortum is using the right to reborrow funds through TVO based on its ownership. See more information in Note 15 Interest-bearing net debt.

Forsmark's provision and share of the fund are based on same principles as described above for OKG and Barsebäck nuclear power plants.

Status of TVO's Olkiluoto 3 project in Finland

Fortum is participating in the country's fifth nuclear power plant unit, Olkiluoto 3 (OL3), through the shareholding in Teollisuuden Voima Oyj (TVO) with an approximately 25% share representing some 400 MW in capacity. Olkiluoto 3 (OL3), currently under test production phase, was procured as a fixed-price turnkey project from a consortium (Plant Supplier) formed by Areva GmbH, Areva NP SAS and Siemens AG. As stipulated in the plant contract, the consortium companies have joint and several liability for the contractual obligations.

In March 2018, TVO signed a comprehensive settlement agreement with the plant supplier consortium companies Areva NP, Areva GmbH, and Siemens AG as well as with Areva Group parent company Areva SA, a company wholly owned by the French State. The settlement agreement was amended with agreements signed in June 2021. The supplier consortium companies committed to ensuring that the funds dedicated to the completion of the OL3 project will be adequate and will cover all applicable guarantee periods, including setting up a trust mechanism funded by Areva companies to secure the financing of the costs of completing the OL3 project. During the period under review, the fund, which was previously replenished in July 2021, has been used to cover costs incurred to the Areva companies for the completion of the OL3 project in accordance with the settlement agreement.

In December 2021, the Radiation and Nuclear Safety Authority (STUK) granted TVO permission for making the reactor critical and conducting low power tests, after which the startup of OL3's reactor took place. On 12 March 2022, the plant unit was connected to the national grid at a power output of 103 megawatts, which is when OL3's electricity production started. On 30 March 2022, STUK granted TVO permission to increase OL3's power level to 60 percent and carry out new power tests at power levels between 30-60 percent. During the upcoming approximately four-month test production phase, the OL3 plant unit's power output will be gradually increased to 1,600 megawatts. The power

output varies considerably during test production. OL3 produces approximately 3-4 terawatt hours of electricity during the test production phase. According to information received from the plant supplier in the end of April, the regular electricity production starts in September 2022, instead of the previously estimated start at the end of July.

17. Other provisions

EUR million	31 Mar 2022	31 Dec 2021
Supplier- and customer-related	4,435	2,893
Asset retirement	848	872
Power production-related	616	653
Gas distribution-related	343	354
Environmental remediation and similar	249	253
Personnel-related	371	368
Other	823	1,013
Total	7,684	6,406
BS Of which current provisions	3,018	2,299
BS Of which non-current provisions	4,666	4,108

Additions to supplier-related provisions mainly relate to Uniper segment's electricity sales contracts for which the ownuse exemption under IFRS 9 is applied. The provision increased to account for increased electricity prices and the associated higher purchasing costs. Purchases are, however, hedged using derivative financial instruments whose fair value measurement has offsetting effects recognised in items affecting comparability (see Note 4 Comparable operating profit and comparable net profit). Future cash outflows from the utilisation of the provision are offset by cash inflows from the hedges.

18. Pension obligations

Fortum Group has a number of pension schemes in accordance with local conditions and practices in the countries in which it operates, including defined benefit plans where the pension obligation is based on actuarial calculations using assumptions for discount rate, future salary and pension increases, inflation and mortality.

Changes during 2022 mainly relate to changes in discount rates and fair value of plan assets.

Net defined benefit liability

EUR million	31 Mar 2022	31 Dec 2021
Present value of defined benefit obligation	3,884	4,437
Fair value of plan assets	3,000	3,290
Net defined benefit liability	886	1,146
Of which Germany	796	1,051
Presented on the balance sheet as follows:
BS Pension obligations, net	931	1,190
Pension assets in Other non-current assets	46	44

Discount rates

The following discount rates have been used for the calculation of the present value of the defined benefit obligation:

%	31 Mar 2022	31 Dec 2021
Germany	2.0	1.2
United Kingdom	2.8	2.0
Finland	1.8	1.0

19. Capital and other commitments

Capital and other commitments are contractual or regulatory obligations that are not recognised as liabilities on the balance sheet, or disclosed as contingent liabilities.

Capital commitments

EUR billion	31 Mar 2022	31 Dec 2021
Property, plant and equipment and intangible assets	1.0	1.0

Long-term purchase commitments

Fortum has long-term contractual purchase obligations of approximately EUR 107.8 billion at 31 March 2022 (31 Dec 2021: 88.8), of which EUR 22.9 billion is due within one year (31 Dec 2021: 16.3). These contracts are generally takeor-pay in nature and primarily relate to the purchase of natural gas. Price paid for natural gas is normally tied to market reference prices, as dictated by market conditions and the procurement behaviour of wholesale market customers. The conditions of these long-term contracts are reviewed at certain specific intervals (usually every three years) as part of contract negotiations and may thus change accordingly. The increase in contractual purchase obligations is primarily attributable to price increases in long-term gas contracts.

Other commitments

Teollisuuden Voima Oyj (TVO) built Olkiluoto 3, the nuclear power plant funded through external loans, share issues and shareholder loans according to shareholders' agreement between the owners of TVO. At 31 March 2022, Fortum had EUR 232 million (31 Dec 2021: 232) outstanding receivables regarding Olkiluoto 3, and is additionally committed to providing at maximum EUR 100 million. TVO shareholder loan is classified as participation in joint ventures. For more information, see Note 16 Nuclear-related assets and liabilities.

For more information on other commitments, see Note 35 Capital and other commitments of the consolidated financial statements 2021.

20. Pledged assets and contingent liabilities

Fortum has issued direct and indirect guarantees and warranties on own behalf and on behalf of associated companies and joint ventures, which may obligate Fortum to make payments on the occurrence of certain events. For the Swedish nuclear companies there are two types of guarantees given. The Financing Amount is given to cover Fortum's share of the uncovered part in the Nuclear Waste Fund, assuming no further production and that no further nuclear waste fees are paid in. The uncovered amount is calculated by the authorities and is based on the difference between the expected costs and the funds to cover these costs at the time of the calculation. The Supplementary Amount constitutes a guarantee for deficits that can arise as a result of unplanned events.

The guarantee given on behalf of Teollisuuden Voima Oyj to the Finnish State Nuclear Waste Management Fund amounts to EUR 122 million (31 Dec 2021: 122). The guarantee covers the unpaid legal liability due to periodisation, as well as risks for unexpected future costs. For more information, see Note 16 Nuclear-related assets and liabilities.

Further, Fortum has pledged certain assets for debt and other commitments, both on own behalf and on behalf of others, including EUR 269 million (31 Dec 2021: 269) for shares pledged in Kemijoki Oy as a security for borrowing from the Finnish State Nuclear Waste Management Fund, and EUR 81 million (31 Dec 2021: 81) of real estate mortgages for the liability to the Finnish State Nuclear Waste Management Fund.

On 14 March 2022, S&P Global Ratings placed Fortum's and Uniper's BBB ratings on credit watch negative. A lowering of credit ratings, in particular, to below investment grade level would trigger counterparties' rights (mainly in Uniper segment's Global Commodities business) to demand additional cash or non-cash collateral. See also section 'Capital risk management'.

For more information, see Note 36 Pledged assets and contingent liabilities of the consolidated financial statements 2021.

21. Legal actions and official proceedings

Various routine court actions, arbitration proceedings, tax and regulatory investigations and proceedings are currently pending against entities of the Group, and further actions or proceedings may be instituted or asserted in the future. In addition to disputes under public law, this in particular includes legal actions and proceedings on contract amendments and price adjustments initiated in response to market upheavals and the changed economic situation in the gas and electricity sectors (also as a consequence of the energy transition) and concerning anticompetitive and fraudulent practices, as well as general commercial contract disputes.

The aforementioned proceedings include several court and arbitration proceedings with major customers and major suppliers, also initiated in some instances by the Group, concerning contract amendments and price adjustments in long-term supply contracts and procurement options for electricity and gas, as well as long-term contracts for storage capacity in response to the altered situation brought about by market upheavals, and also reimbursements of costs. In some of these cases, the validity of the price-adjustment clauses applied, and of the contracts in their entirety is in dispute. Long-term LNG and gas procurement contracts generally include the option for producers and importers to adjust the terms in line with changed market conditions. On this basis, the Group is currently involved in court and arbitration proceedings and continuously conducts extensive negotiations with producers. The possibility of further legal disputes cannot be excluded. Applying the provisions of IAS 37.92, Fortum is making no additional disclosures on the proceedings presented or on the associated risks or measures taken, particularly because such disclosure could prejudice their outcome.

Furthermore, proceedings are pending concerning the clarification of regulatory requirements. Applying the provisions of IAS 37.92, Fortum is making no additional disclosures on the proceedings presented or on the associated risks or measures taken, particularly because such disclosure could prejudice their outcome.

Public-law disputes are pending, in particular, in connection with the operating license and the planning basis for the hard-coal power plant in Datteln, Germany. Applying the provisions of IAS 37.92, Fortum is making no additional disclosures on the proceedings presented or on the associated risks or measures taken, particularly because such disclosure could prejudice their outcome.

Tax cases in Belgium

On 16 June 2020, the Court of Appeal of Ghent, Belgium, ruled in favour of Fortum on Fortum's income tax assessments in Belgium for the year 2008. The decision concerns Fortum's Belgian financing company, Fortum EIF NV, which granted internal financing to a Swedish group company for financing of an acquisition in Russia. The Belgian tax authorities argued that Fortum EIF should not benefit from the notional interest deduction regime in Belgium and disagreed with the Court of Appeal ruling. In September 2020, the Belgian tax authorities filed an appeal to the Supreme Court.

The additional taxes claimed for 2008 amount to EUR 36 million. Fortum has similar tax cases pending for the years 2009-2012 and expects the remaining years to follow the decisions for 2008. The disputed amount for years 2008- 2012 totals EUR 113 million. All taxes have been paid and recognised as income tax receivables. Should the decision from the Court of Appeal of Ghent become final, the possible repayment of the disputed amounts of EUR 113 million would have a positive cash flow effect for Fortum.

22. Related party transactions

Related parties are described in more detail in the consolidated financial statements for the year ended 31 December 2021.

Transactions with associates, joint ventures and other related parties

EUR million	I/2022	I/2021	2021	LTM
Sales	4	120	230	114
Purchases	259	187	773	845
Other income	7	36	342	313
Interest income on loan receivables	5	6	25	24

Balances with associates, joint ventures and other related parties

EUR million	31 Mar 2022	31 Dec 2021
Long-term interest-bearing loan receivables	1,039	1,138
Trade and other receivables	322	110
Long-term loan payables	229	228
Short-term loan payables	79	131
Trade and other payables	183	114

Other related parties are entities that are not consolidated on materiality grounds. For more information, see Note 1 Significant accounting policies of the consolidated financial statements 2021.

In addition, Fortum has long-term purchase commitments of approximately EUR 1.9 billion at 31 March 2022 from associates and joint ventures.

Other transactions with related parties

At the end of 2021, the Finnish State owned 50.76% of Fortum's shares. There has been no change in the number of shares the Finnish State owns in Fortum during 2022.

On 18 January 2022, Fortum announced that 1.3 GW portfolio of wind projects is being transferred to a new joint venture. Due to the current geopolitical circumstances, Fortum is looking into revisiting the structure.

In June 2021, the Fortum-Rusnano wind investment fund sold the 200-MW Kalmykia wind parks to the Fortum-Russian Direct Investment Fund (RDIF) joint venture. Fortum recorded a gain of EUR 11 million from the transfer in the share of profits from associates and joint ventures.

On 2 March 2021, Fortum announced it had decided to construct the largest solar power plant in Russia through a joint venture established with RDIF. The power plant is based on capacities won by Fortum in CSA auctions in 2018 and 2019. In March 2021, Fortum sold the CSA-backed solar power project to the joint venture with RDIF.

23. Events after the balance sheet date

There have been no material events after the balance sheet date.

24. Definitions and reconciliations of key figures

Alternative performance measures

Business performance	Definition	Reason to use the measure	Reference to reconciliation
Comparable EBITDA	Operating profit + depreciations and amortisations - items affecting comparability	Comparable EBITDA is representing the underlying cash flow generated by the total Group and segments. Used as a component in the capital structure target of Financial net debt to Comparable EBITDA.	Key ratios after cash flow statement
Comparable operating profit	Operating profit - items affecting comparability	Comparable operating profit is used in financial target setting and forecasting, management's follow up of financial performance and allocation of resources in the group's performance management process.	Income statement
Items affecting comparability	Impairment charges and reversals + capital gains and other related items + changes in fair values of derivatives hedging future cash flow + other	Component used in calculating comparable operating profit and comparable EBITDA.	Income statement
Impairment charges and reversals	Impairment charges and related provisions (mainly dismantling), as well as the reversal of previously recorded impairment charges. Impairment charges are adjusted from depreciation and amortisation, and reversals from other income.	Component used in calculating comparable operating profit and comparable EBITDA.	Income statement
Capital gains and other related items	Capital gains and transaction costs from acquisitions, which are adjusted from other income and other expenses respectively. Profits are reported in comparable operating profit, if this reflects the business model.	Component used in calculating comparable operating profit and comparable EBITDA.	Income statement
Changes in fair values of derivatives hedging future cash flow	Effects from financial derivatives hedging future cash flows where hedge accounting is not applied or own use exemption cannot be used according to IFRS 9 and are adjusted from other income or expense to sales and materials and services respectively when calculating Fortum's alternative performance measures.	Component used in calculating comparable operating profit and comparable EBITDA.	Income statement
Other	Restructuring and cost management expenses, and other miscellaneous non-operating items, which are adjusted mainly from materials and services or employee benefits.	Component used in calculating comparable operating profit and comparable EBITDA.	Income statement

Fortum Corporation Notes to the condensed consolidated interim financial statements

Business performance	Definition	Reason to use the measure	Reference to reconciliation
Comparable share of profit/loss of associates and joint ventures	Share of profit/loss of associates and joint ventures +/- significant adjustments for share of profit /loss in principal associates and joint ventures.	Component used in calculating comparable net profit and comparable return on net assets.	Note 4 Comparable operating profit and comparable net profit
Comparable finance costs – net	Finance costs – net +/- return from nuclear funds, nuclear fund adjustment and unwinding of nuclear provisions +/- fair value changes on financial items +/- impairment charges and reversals of previously recorded impairment charges on financial items.	Component used in calculating comparable net profit.	Note 4 Comparable operating profit and comparable net profit
Comparable profit before income tax	Comparable operating profit +/- comparable share of profit/loss of associates and joint ventures +/- comparable finance costs – net.	Subtotal in comparable net profit calculation.	Note 4 Comparable operating profit and comparable net profit
Comparable income tax expense	Income tax expense excluding taxes on items affecting comparability, adjustments to finance costs – net, tax rate changes and other onetime adjustments.	Component used in calculating comparable net profit.	Note 4 Comparable operating profit and comparable net profit
Comparable net profit	Comparable operating profit +/- comparable share of profit/loss of associates and joint ventures +/- comparable finance costs - net +/- comparable income tax expense +/- comparable non-controlling interests.	Comparable net profit is used to provide additional financial performance indicators to support meaningful comparison of underlying net profitability between periods.	Note 4 Comparable operating profit and comparable net profit
Comparable return on net assets, %	Comparable operating profit + comparable share of profit /loss in associates and joint ventures x 100 Comparable net assets average	Comparable return on net assets is used in financial target setting and forecasting, management's follow up of financial performance and allocation of resources in the group's performance management process.	Note 3 Segment information
Adjustment for Share of profit/loss in associates and joint ventures	Adjustment for material items affecting comparability	Share of profit/loss in associates and joint ventures is included in profit component in the comparable return on net assets calculation and the adjustments are done based on similar components as in Items affecting comparability.	Note 3 Segment information
Comparable net assets	Non-interest-bearing assets - non interest-bearing liabilities - provisions (non-interest-bearing assets and liabilities do not include finance-related items, tax and deferred tax and assets and liabilities from fair valuations of derivatives used for hedging future	Comparable net assets is a component in Comparable return on net assets calculation where return on capital allocated directly to the businesses is measured.	Note 3 Segment information

cash flows).

Capital structure	Definition	Reason to use the measure	Reference to reconciliation
Financial net debt / comparable EBITDA	Financial net debt Comparable EBITDA	Financial net debt to Comparable EBITDA is Fortum's long-term financial target for capital structure.	Key ratios after cash flow statement
Financial net debt	Interest-bearing liabilities - liquid funds - securities in interest-bearing receivables +/- net margin liabilities/receivables	Financial net debt is used in the follow-up of the indebtedness of the group and it is a component in the capital structure target of Financial net debt to Comparable EBITDA.	Note 15 Interest-bearing net debt
Adjusted net debt	Financial net debt + underfunded pension obligations and asset retirement obligations, net of share in nuclear waste funds	Adjusted net debt is used in the follow-up of the indebtedness of the group.	Note 15 Interest-bearing net debt

Other key figures

Share based key figures

Earnings per share (EPS)	Profit for the period - non-controlling interests
	Average number of shares during the period
Comparable earnings per share	Comparable net profit
	Average number of shares during the period
Equity per share	Shareholder's equity
	Number of shares at the end of the period
Other key figures
Capital expenditure	Capitalised investments in property, plant and equipment and intangible assets including maintenance, productivity, growth and investments required by legislation including borrowing costs capitalised during the construction period. Maintenance investments expand the lifetime of an existing asset, maintain usage/availability and/or maintains reliability. Productivity investments improve productivity in an existing asset. Growth investments' purpose is to build new assets and/or to increase customer base within existing businesses. Legislation investments are done at certain point of time due to legal requirements.
Gross investments in shares	Investments in subsidiary shares, shares in associated companies and joint ventures and other investments. Investments in subsidiary shares are net of liquid funds and grossed with interest-bearing liabilities and other items included in financial net debt in the acquired company.
Last twelve months (LTM)	Twelve months preceding the reporting date.
Tax key figures
Effective income tax rate, %	Income tax expense Profit before income tax	x 100

Comparable profit before income tax excluding comparable share of

profit/loss from associated companies and joint ventures

Comparable effective income tax rate, % Comparable income tax x 100

Reconciliations of alternative performance measures

Comparable EBITDA

EUR million	Note	I/2022	I/2021	2021	LTM
IS Operating profit		-2,416	1,345	-588	-4,349
+ IS Depreciation and amortisation		334	308	1,281	1,307
EBITDA		-2,082	1,653	693	-3,042
- IS Items affecting comparability	4	1,978	-174	3,124	5,276
Comparable EBITDA		-104	1,479	3,817	2,234

Comparable operating profit

EUR million	Note	I/2022	I/2021	2021	LTM
IS Operating profit		-2,416	1,345	-588	-4,349
- IS Items affecting comparability	4	1,978	-174	3,124	5,276
IS Comparable operating profit	4	-438	1,171	2,536	927

Items affecting comparability

EUR million	Note	I/2022	I/2021	2021	LTM
Impairment charges and reversals		-830	-1	-83	-911
Capital gains and other related items	6	3	51	2,681	2,634
Changes in fair values of derivatives hedging future cash flow		-1,107	165	-5,424	-6,696
Other		-44	-41	-299	-302
IS Items affecting comparability	4	-1,978	174	-3,124	-5,276

Comparable net profit

EUR million	Note	I/2022	I/2021	2021	LTM
IS Net profit		-2,833	1,310	-114	-4,256
- IS Items affecting comparability	4	1,978	-174	3,124	5,276
- Adjustments to share of profit/loss of associates and joint ventures	12	216	-13	-38	191
- Adjustments to finance costs - net	7	1,090	-17	-146	961
- Adjustments to income tax expenses		-654	-110	-780	-1,325
- IS Non-controlling interests		610	-218	852	1,681
- Adjustments to non-controlling interests		-507	57	-1,121	-1,685
Comparable net profit	4	-99	837	1,778	842

Comparable earnings per share

	Note	I/2022	I/2021	2021	LTM
Comparable net profit, EUR million	4	-99	837	1,778	842
Average number of shares during the period, 1 000 shares		888,294	888,294	888,294	888,294
Comparable earnings per share, EUR		-0.11	0.94	2.00	0.95

Financial net debt and adjusted net debt

EUR million Note	31 Mar 2022	31 Dec 2021
+ Interest-bearing liabilities	14,875	17,220
- BS Liquid funds	6,419	7,592
- Non-current securities	106	111
- Collateral arrangement securities	537	549
- Securities in interest-bearing receivables	643	660
- BS Margin receivables	7,441	9,163
+ BS Margin liabilities	1,864	985
+/- Net margin liabilities/receivables	-5,578	-8,179
15 Financial net debt	2,235	789
+ BS Pension obligations	931	1,190
+ Other asset retirement obligations	848	872
- BS Share of Finnish and Swedish Nuclear Waste Funds	3,399	3,515
+ BS Nuclear provisions	3,840	3,891
+ Nuclear provisions net of assets in Nuclear Waste Funds	441	375
+ Total provisions net of assets in Nuclear Waste Funds	2,219	2,438
Adjusted net debt	4,454	3,227

See Note 15 Interest-bearing net debt.

Financial net debt/comparable EBITDA

EUR million	Note	2021	LTM
+ Interest-bearing liabilities		17,220	14,875
- BS Liquid funds		7,592	6,419
- Non-current securities		111	106
- Collateral arrangement securities		549	537
- Securities in interest-bearing receivables		660	643
- BS Margin receivables		9,163	7,441
+ BS Margin liabilities		985	1,864
+/- Net margin liabilities/receivables		-8,179	-5,578
Financial net debt	15	789	2,235
IS Operating profit		-588	-4,349
+ IS Depreciation and amortisation		1,281	1,307
EBITDA		693	-3,042
- IS Items affecting comparability		3,124	5,276
Comparable EBITDA		3,817	2,234
Financial net debt/comparable EBITDA		0.2	1.0

Market conditions and achieved power prices

Power consumption

TWh	I/2022	I/2021	2021	LTM
Nordic countries	112	120	404	396
Central western Europe	361	376	1,359	1,344
Central western European gas demand	699	803	2,218	2,114
Russia	303	297	1,090	1,096
Tyumen	25	23	90	92
Chelyabinsk	10	10	37	37
Russia Urals area	70	69	256	257
Russia Siberia area	61	59	217	219
Average prices	I/2022	I/2021	2021	LTM

Spot price for power in Nord Pool power exchange, EUR/MWh	110.0	42.1	62.3	79.0
Spot price for power in Finland, EUR/MWh	91.8	48.6	72.3	83.0
Spot price for power in Sweden, SE3, Stockholm EUR/MWh	99.9	45.7	66.0	79.4
Spot price for power in Sweden, SE2, Sundsvall EUR/MWh	24.8	37.5	42.6	39.4
Spot price for power in the First Price Zone of Russia, RUB/MWh 1)	1,449	1,360	1,405	1,427
Spot price for power in the Second Price Zone of Russia, RUB/MWh 1)	1,100	918	935	980
Average capacity price for the Russia segment, tRUB/MW/month	536	636	584	559
Average capacity price for the Uniper segment, tRUB/MW/month	365	251	293	321
Spot price for power in Germany, EUR/MWh	184.6	49.6	96.8	130.1
Average regulated gas price in Urals region, RUB/1000 m3	4,137	4,016	4,077	4,107
Average capacity price for the Russia segment's CCS, tRUB/MW/month 2) 3)	209	182	170	178
Average capacity price for the Russia segment's CSA, tRUB/MW/month 3)	1,217	1,289	1,174	1,152
Average capacity price for the Uniper segment's CCS, tRUB/MW/month 2) 3)	202	169	160	167
Average capacity price for the Uniper segment's CSA, tRUB/MW/month 3)	2,245	1,163	1,488	1,702
Spot price for power (market price), Urals hub, RUB/MWh 1)	1,284	1,158	1,221	1,253
CO2, (ETS EUA next Dec), EUR/tonne CO2	83	38	54	65
Coal (ICE Rotterdam front month), USD/tonne	222	69	117	155
Oil (Brent front month), USD/bbl	98	61	71	80
Gas (TTF front month), EUR/MWh	101	19	47	68
1) Excluding capacity tariff.

2) Including capacity receiving payments under "forced mode status", regulated tariffs, and bilateral agreements.

3) Capacity prices paid for the capacity volumes, excluding unplanned outages, repairs, and own consumption.

Water reservoirs and gas storage levels

TWh	31 Mar 202231 Dec 2021
Nordic water reservoirs level	35	73
Nordic water reservoirs level, long-term average	41	84
Central western European gas storage levels	137	293

Export/import

TWh (+ = import to, - = export from Nordic area)	I/2022	I/2021	2021	LTM
Export / import between Nordic area and Continental Europe + Baltics	-10	-5	-29	-34
Export / import between Nordic area and Russia	2	2	9	9
Export / import Nordic area, Total	-8	-2	-20	-26

Power market liberalisation in Russia

%	I/2022	I/2021	2021	LTM
Share of power sold at the liberalised price	77	79	79	79

Achieved power prices

	I/2022	I/2021	2021	LTM
Generation segment's Nordic achieved power price, EUR/MWh	44.1	37.2	42.8	44.7
Uniper segment's Nordic achieved power price, EUR/MWh	14.8	31.5	30.7	26.0
Russia segment's achieved power price, RUB/MWh	1,913	1,892	2,018	2,027
Russia segment's achieved power price, EUR/MWh 1)	19.3	21.1	23.2	22.7
Uniper segment's achieved power price in Russia, RUB/MWh 2)	1,600	1,320	1,643	1,724
Uniper segment's achieved power price in Russia, EUR/MWh 1) 2)	16.1	14.7	18.9	19.3

1) Translated using average exchange rate.

2) Comparable prices changed from previously reported.

Fortum's production and sales volumes

Power generation

TWh	I/2022	I/2021	2021	LTM
Power generation in Nordics	17.7	19.5	68.8	67.0
Power generation in other European countries	12.8	12.1	46.9	47.6
Power generation in Russia	22.4	20.7	71.9	73.6
Power generation in other countries	-	0.2	0.5	0.3
Total	52.9	52.5	188.1	188.4

Heat production

TWh	I/2022	I/2021	2021	LTM
Heat production in Nordics	1.9	2.1	5.5	5.3
Heat production in other European countries	2.8	3.3	8.7	8.3
Heat production in Russia	7.0	8.4	19.1	17.7
Total	11.7	13.9	33.4	31.2

Power generation capacity by segment

MW	31 Mar 2022	31 Dec 2021
Generation 1)	8,041	8,041
Russia	4,672	4,672
City Solutions	559	559
Uniper 2)	33,837	33,828
Total	47,109	47,099

1) Including 440 MW of Meri-Pori power plant, which is under reserve capacity agreement during period July 2020 - June 2022.

2) Including 875 MW of Heyden 4 power plant, which is under reserve capacity agreement during period July 2021 - September 2022.

Heat production capacity by segment

MW	31 Mar 2022	31 Dec 2021
Russia	7,613	7,613
City Solutions	3,026	3,026
Uniper	6,197	6,232
Total	16,836	16,871

Power generation by source in the Nordic area

TWh	I/2022	I/2021	2021	LTM
Hydro and wind power	7.8	9.0	31.4	30.2
Nuclear power	9.7	9.9	36.4	36.2
Thermal power	0.2	0.5	1.0	0.7
Total	17.7	19.5	68.8	67.0

Power generation by source in the Nordic area

%	I/2022	I/2021	2021	LTM
Hydro and wind power	44	46	46	45
Nuclear power	55	51	53	54
Thermal power	1	3	1	1
Total	100	100	100	100

Power generation by source in other European countries

TWh	I/2022	I/2021	2021	LTM
Hydro and wind power	1.1	1.0	4.9	5.0
Thermal power	11.7	11.1	42.0	42.6
Total	12.8	12.1	46.9	47.6

Power generation by source in other European

countries

%	I/2022	I/2021	2021	LTM
Hydro and wind power	8	8	10	10
Thermal power	92	92	90	90
Total	100	100	100	100

Power sales

EUR million	I/2022	I/2021	2021	LTM
Power sales in Nordics	1,698	1,287	5,319	5,730
Power sales in other European countries 1)	9,020	5,259	26,005	29,767
Power sales in Russia	453	438	1,750	1,764
Power sales in other countries	0	5	24	19
Total	11,171	6,989	33,098	37,280

1) Including commodity trading.

Heat sales

EUR million	I/2022	I/2021	2021	LTM
Heat sales in Nordics	172	146	403	429
Heat sales in other European countries	235	194	660	701
Heat sales in Russia	49	64	154	139
Total	455	405	1,217	1,267

Power sales by area

TWh	I/2022	I/2021	2021	LTM
Finland	5.9	6.9	23.0	22.0
Sweden	14.1	15.3	53.5	52.3
Russia	26.3	25.0	84.9	86.2
Norway	3.8	4.9	13.7	12.6
Germany 1)	51.4	90.9	334.9	295.4
United Kingdom	14.4	7.4	19.5	26.5
Netherlands	5.7	2.5	22.4	25.6
Other countries	3.0	2.4	7.6	8.2
Total	124.7	155.4	559.4	528.7

1) Including commodity trading.

Nord Pool transactions are calculated as a net amount of hourly sales and purchases at the Group level.

Heat sales by area

TWh	I/2022	I/2021	2021	LTM
Russia	7.0	8.4	19.0	17.6
Finland	1.1	1.2	3.1	3.0
Norway	0.7	0.8	1.8	1.7
Poland	1.5	1.6	3.8	3.7
Germany	1.0	1.2	3.6	3.4
Netherlands	1.4	1.0	3.2	3.6
Other countries	0.1	0.8	1.3	0.6
Total	12.8	15.0	35.9	33.7