Large Investments at Reykjavík Energy – Continued Decrease of Debt

30. sep 2021


Investments of Orkuveita Reykjavíkur (Reykjavík Energy; OR) and its subsidiaries will amount to over ISK 106 billion over the next six years, according to the Group's financial forecast, approved today by OR‘s Board of Directors. The financial forecast, which is for the years 2022 through 2027, is consolidated for the group. In addition to the parent company, the Group includes Veitur Utilities, ON Power, Reykjavik Fibre Network, and Carbfix. During the period, interest-bearing debt is forecast to decrease by ISK 36 billion.

OR consolidated forecast 2022 and long-term plan 2023-2027

Most investments climate-linked

Bjarni Bjarnason, Reykjavík Energy’s CEO, says that the Group’s finances are sound and that significant fluctuations are neither foreseen in income nor expenses. "As always, a significant part of the income goes to maintaining the large assets entrusted to the companies that provide us with green energy, fresh water, and a healthier environment," says Bjarni.

He adds that considerable investment in innovation is ahead, most of which either decrease carbon footprint or improve the operation’s climate resilience. "In this respect, Carbfix stands out with its important method for permanent carbon sequestration, the upgrade of all of Veitur Utilities’ energy meters allow for customers’ better monitoring of their use. ON Power will continue to pioneer in charging solutions for electric cars. Veitur Utilities will also contribute to the forthcoming revolution in public transport in the capital area and Reykjavík Fibre Network’s system proved its value during the epidemic when many people could not travel to work," says CEO Bjarni Bjarnason.

Excerpts from the consolidated financial forecast 2022-2027

  • The Reykjavík Energy Group forecasts investments to the amount of ISK 106 billion in years 2022-2027, ISK 17.7 billion annually, on average.
  • OR's net interest-bearing debt will decrease by ISK 36 billion from 2021 through 2026 according to the forecast.
  • OR's income taxes will amount to ISK 18 billion during the period.
  • Dividend payments by OR to owners–the City of Reykjavík, the Township of Akranes and The Municipality of Borgarbyggð–will amount to ISK 33 billion for the forecast period.
  • A general upgrade of Veitur Utilities’ energy meters has begun. New smart meters create opportunities for more diverse and better customer service.
  • A significant part of Veitur Utilities’ investments is in the maintenance of the company's extensive utility systems, which combined stretch nearly 10,000 kilometres.
  • ON Power's investments aim to ensure efficient utilization of power plants through reliable steam supply and to fulfil the company’s ambitious environmental targets. The company’s Resource Park at Hellisheiði will be further developed.
  • The installation of fibre optic cables of Reykjavik Fibre Network to homes in the urban areas of Reykjanesbær, Árborg and Vogar will be completed during the forecast period and the fibre-system’s mains will be upgraded to meet the needs of telecoms upgrading to 5G.
  • The start-up company Carbfix will continue to build carbon offsets and disposal at ON power plants and beyond.
  • The parent company will continue the development of Elliðaárstöð, a history and technology exhibition in Elliðaárdalur, as well as the reclamation of natural environment in the valley when electricity generation has been discontinued.

Reykjavík Energy’s consolidated financial forecast for 2022 and the five-year forecast for 2023–2027 will be discussed by the Reykjavík City Council, as part of the consolidated budget of the City.