Sales and distribution
Vattenfall distributes and sells electricity and heat to industrial customers as well as private households and conducts gas production and sales. Sweden, Germany and the Netherlands are Vattenfall’s core markets.
Vattenfall’s vision is to ”be among the leaders in developing environmentally sustainable energy production”. Six energy sources form the basis for Vattenfall’s electricity production: hydro, nuclear, coal, gas, wind and biomass.
Vattenfall’s strategic direction is to keep a diversified portfolio over time, but with a greater share of the low-emitting and renewable sources like wind and biomass. In the longer run, when there is possibility, Vattenfall also intends to grow in hydropower and nuclear power.
The electricity market includes the wholesale market and the retail market.
In the wholesale market the physical product electricity is traded between the producers and major customers (big industries and sales companies). Due to limited transmission capacity the market is regionally divided with geographically determined price differences (the Nordic market being separate from the Central European market), but there is a development towards one European market.
Also within each geographical market there may be local differences in pricing for the same reason. Supply and demand determine the prices in each moment. Vattenfall Sales buys all its electricity to market prices.
In the retail market households, business and industries sign delivery contracts with different sales companies. The customer can choose between a wide range of fixed, variable and tailored pricing options. Tough competition and low margins characterise the market.
The trading unit, Vattenfall Energy Trading, provides portfolio and risk management services to business customers.
Vattenfall offers a variety of electricity and heat services to private households as well as public and private industry sectors – to help our customers manage their individual energy needs efficiently. Business customers may combine electricity purchases with energy solutions and operation and maintenance services to increase efficiency and lower costs.
Our energy solutions and process efficiency solutions are designed to lower the total cost of energy in a plant, increase effectiveness of energy utilisation, and lower our customers’ environmental impact.
For houshold customers Vattenfall offers extensive energy advice service on its websites, as well as smart services that enable customers to follow and decrease their energy consumption on their home computer in real time. In the Netherlands, Nuon offers a great variety of value added services to private customers, including maintenance and servicing of heating and other household installations.
For city customers, Vattenfall can contribute with a unique system integration perspective, and its knowledge to make cities, consumers and companies more energy conscious. By connecting existing products such as district heating, cooling, decentralized energy production (heat pumps), and energy demand monitoring (visualization) among others, Vattenfall meets the cities’ climate challenges by proactive partnerships.
Electricity distribution is a regulated monopoly business. Electricity is transported to end-customers in regional and local electricity networks. Vattenfall is one of many network company owners in the market. According to the law, the networks must be operated by separate legal entities, even if major power companies, utilities, municipalities or others own them.
Vattenfall does not own or operate transmission lines, the large high-voltage networks that transport large volumes of electricity over longer distances. In Sweden the transmission grid is run by the state owned utility, Svenska Kraftnät. Vattenfall’s German transmission grid company was sold in 2010.
With stakes in 36 operating gas fields in the Dutch North Sea Shelf, Nuon has gas production capabilities as well as gas trading, wholesale and retail activities. Nuon also stores gas in caverns of disused salt mines in the German town of Epe, just across the border at Enschede, thereby enabling the company to respond flexibly to fluctuations in the supply and demand of gas.
Vattenfall produces and sells central heating, central cooling and electricity in Sweden, Finland, Germany and the Netherlands. Vattenfall also produces heat in Poland and Denmark. Central heating, the main product, is a simple, safe, comfortable and reliable form of heating, with little environmental influence. Main fuels are various forms of biomass, waste, peat and natural gas. The customers include both end-customers and forward suppliers.