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REPORT OF THE
BOARD OF DIRECTORS
AND FINANCIAL
STATEMENTS
Contents
REPORT OF THE BOARD OF DIRECTORS AND FINANCIAL STATEMENTS 2022
2
REPORT OF THE BOARD OF DIRECTORS KEY FIGURES GROUP FINANCIAL STATEMENTS PARENT COMPANY FINANCIAL STATEMENTS FINANCIAL INFORMATION
Report of the Board of Directors of Teollisuuden Voima Oyj
Main events in 2022
The role of low-carbon energy, such as renewable
energy and nuclear power, is crucial in the mitigation
of climate change. In 2022, the share of nuclear
power was approximately 35 percent of all electricity
produced in Finland. During its over 50-year history,
Teollisuuden Voima Oyj (TVO) has produced more
than 550 terawatt hours (billion kilowatt hours) of
climate-friendly electricity in total.
The electricity generation at TVO’s Olkiluoto nuclear
power plant totalled 16.35 terawatt hours in 2022,

consumed and about 24 percent of all electricity
produced in Finland. The combined load factor of
the Olkiluoto 1 (OL1) and Olkiluoto 2 (OL2) plant
units was 93.0 percent. The Olkiluoto 3 (OL3) plant
unit’s load factor during test production was 16.9
percent. The consolidated turnover was EUR 358.2
(298.7) million.

Finland was produced at the Olkiluoto nuclear power
plant during all of 2022. The OL1 plant unit produced
6.9 (7.4) TWh of electricity, and its load factor was
89.1 (95.1) percent. The OL2 plant unit reached a
record production result, as electricity production
rose to 7.5 (7.0) TWh, and the load factor was 96.8
(90.4) percent. The OL3 plant unit was connected to
the national grid on 12 March 2022 and reached its

2022. During the test production in 2022, OL3
produced 1.9 TWh of electricity.
The OL1 plant unit underwent a maintenance
outage of 33 days, which was longer than usual, and
therefore had an impact on the amount of electricity
production. A refuelling outage lasting nine days
took place at the OL2 plant unit. The annual outages
were carried out successfully together with a broad
network of partners. Both plant units have been
modernised throughout their history, and annual
investments amounting to tens of millions of euros
continue to this day. An I&C modernisation project

part of the plant units’ reactor and operating I&C
will be updated. In addition to TVO’s own personnel,
approximately 490 external resources participated in
the refuelling outage and approximately 830 external
resources worked in the maintenance outage.
Around 190 specialists arrived from abroad for the
annual outages.
During 2022, the OL3 plant unit’s test production
gradually proceeded to tests at full reactor capacity.
OL3’s regular electricity production starts in March
2023.

ONKALO site during 2022. The excavation of the

in June. Civil works at the encapsulation plant were
completed at the end of May. Thereafter, work has
continued with different equipment and system

is to start in Olkiluoto in the mid-2020s.
At the end of the year, the total number of personnel in
the Group was 1,007 (984). The number of personnel

Oy was 90 (93). A total of 95 (71) new staff members
were recruited at the TVO Group during 2022.
Operating environment
During 2022, nuclear power was included in the

Commissions proposal included technical screening
criteria for existing nuclear power plants as well as
new nuclear power plants. The application of the
taxonomy criteria enters into force on 1 January 2023.

plan after Russia’s attack on Ukraine. The plan aimed
at cutting the use of Russian natural gas by two
thirds by the end of 2022, as well as discontinuing
imports completely by 2027. As a result of the
attack, the prices of different energy sources rose.

measures, such as a revenue cap on so-called infra
-
marginal electricity production methods (including
nuclear power). The energy crisis is also leading to
changes in the EU’s electricity market rules – the
Commissions aim is to accept a legislation proposal

The TVO Group closely follows the situation in
Ukraine and its impact on the Group’s operations. The
TVO Group condemns Russia’s attack on Ukraine.
During the accounting period, the Ukrainian situation
has not had an immediate or direct effect on the
Group’s operations or the production of electricity.
However, cost increases are being prepared for in
the TVO Group. Market interest rates have strongly

central banks.
The processing of the Commission’s Fit for 55
package, unveiled in July 2021, is nearing an end.
The objective of the package is to update the instru
-
ments of the EU’s energy and climate policies, so that
they correspond with the goal to cut the EU’s green
-
house gas emissions by 55 percent compared to the

plan, the Commission published updates to proposals
in the package, including an increase to the goal


suggested that the goal could also be reached by
using hydrogen produced with low-emission elec
-
tricity, including nuclear power.
REPORT OF THE BOARD OF DIRECTORS AND FINANCIAL STATEMENTS 2022
3
REPORT OF THE BOARD OF DIRECTORS KEY FIGURES GROUP FINANCIAL STATEMENTS PARENT COMPANY FINANCIAL STATEMENTS FINANCIAL INFORMATION
In spring 2022, the International Energy Agency

Energy Transitions, in which it examines the role of
nuclear power as a solution to climate and energy
crises. The report repeated the estimate in the IEAs
“Net Zero 2050” report, in which nuclear energy
capacity needs to almost double from 400 GW
e
to 800
GW
e
by 2050 in order to achieve carbon neutrality.
The harmonisation of the nuclear industry has
progressed during the year. The International Atomic
Energy Agency (IAEA) started its Nuclear Harmoni
-

which aims at accelerating the safe and widescale
deployment of advanced reactor types, especially


partnership programme.
The construction of nuclear power is speeding up in
Europe. For example, France declared in February
2022 that it will build six new large reactors as of
2028, with an option to build eight more by 2050.

decided in its government programme to request
Vattenfall to analyse additional construction of
nuclear power.
In an energy attitude survey published by Finnish
Energy twice a year, the total support for nuclear power
was 83 percent in December 2022, as 65 percent of
Finns want to increase nuclear power and 18 percent
think that the current amount is suitable. The support
for nuclear power has risen in all citizen groups regard-
less of gender, municipality, age, or political views.
Finland is preparing for the parliamentary election in
spring 2023 and the work of the new government.

started by the current government will be carried out

TVO as a company
TVO is a non-listed public limited-liability company
owned by Finnish industrial and energy companies.
According to TVO’s Articles of Association, the

transmission system construction and acquisition
as well as in the generation, relay, and transfer of
electricity primarily to the Company’s shareholders
in accordance with the terms set in the Articles of
Association.
TVO operates on a cost-price principle (Mankala prin
-
ciple). The shareholders are charged incurred costs in


circumstances dictate otherwise. According to the
Articles of Association, the shareholders pay variable
costs based on the volumes of energy supplied and

-
less of whether they have made any use of their
share of the output or not. Due to the Company’s

performance will not be presented (see chapter: The
cost-price principle in the Notes to the consolidated


like TVO, operate based on the Mankala principle.
Electricity generated by TVO serves the needs of
numerous Finnish industry and energy companies,
some of which were owned by 131 Finnish munici
-
palities in 2022. TVO generates about 20 percent of
all electricity consumed in Finland.
TVO’s operations are founded on a strong safety
culture and securing the safety of production. TVO’s
activity-based management system covers produc
-
tion activities at the Olkiluoto nuclear power plant,
maintaining and developing production capacity,
additional construction of production capacity, and
functions required to control and resource these
activities. The system meets the requirements of
international quality control, environmental, occu
-
pational health and occupational safety standards,

Finland Oy Ab. The general part of the activity-based
management system also acts as the licensee’s
quality control system approved by the Radiation


activity-based management system is regularly moni
-
tored with internal audits and management reviews.
TVO’s corporate governance system is described in
a separate report. TVOs principles of responsible
operating practices are described in the TVO Groups
Code of Conduct (see chapter: Responsibility).
The objectives of TVO’s strategy include a strong
safety brand, the competitive and predictable price

goal is to maintain a competitive average electricity
production cost and to ensure that the operability of

culture is maintained at a high level, and safety is
systematically upheld and developed at all stages of
the nuclear power lifecycle.
Financial performance
The Group’s consolidated turnover for 2022 was EUR
358.2 (298.7) million.
The amount of electricity delivered to the shareholders
was 16,316 (14,414) GWh. The higher delivery
volume of electricity compared to the previous year is
due to the OL3 plant unit’s test production.

million. Updated cost estimates based on a new
nuclear waste management technical plan and
schedule and the changes of the provision regarding
the nuclear waste management obligation had an

chapter: Nuclear waste management).
Financing and liquidity

TVO’s liabilities (non-current and current) at the
end of the year, excluding the loan from the Finnish

shareholders, totalled EUR 5,727.1 (5,206.0) million,
of which EUR 929.3 (929.3) million were subordi
-
nated shareholder loans. During 2022, TVO raised a
total of EUR 1,050.0 (800.0) million in non-current
liabilities, of which none were subordinated share
-
holder loans (no subordinated shareholder loans).
Repayments during the year amounted to EUR 457.5
(566.5) million.

year bond with an annual coupon of 2.625 percent.
The bond was issued under the Company’s EMTN
programme. TVO also announced that it has made an
invitation to holders of its outstanding EUR 311.77
million Notes due in January 2023 to tender their Notes
for purchase by TVO for cash. The tender offer results
were announced on 31 March 2022. The aggregate
principal amount validly offered for purchase by the
REPORT OF THE BOARD OF DIRECTORS AND FINANCIAL STATEMENTS 2022
4
REPORT OF THE BOARD OF DIRECTORS KEY FIGURES GROUP FINANCIAL STATEMENTS PARENT COMPANY FINANCIAL STATEMENTS FINANCIAL INFORMATION
noteholders was EUR 106.1 million. TVO accepted all
valid instructions pursuant to the tender offer.
In June 2022, TVO signed a new three-year revolving
credit facility of EUR 1,000 million. The facility includes

TVO’s existing revolving credit facility signed in February
2016 and will be used for general corporate purposes.


A one-year extension was made to TVO’s shareholder
loan commitment of EUR 400 million agreed upon in
December 2020, when TVO’s shareholders signed the
extension in November 2022. The extended share
-
holder loan commitment is valid until the end of 2023.
At the end of the year, TVO agreed on new bilateral
bank loans totalling EUR 300 million.

long-term credit rating BBB- for TVO and changed
the outlook from negative to stable. In March 2022,


outlook. According to both credit rating agencies, the
changes to the credit ratings are mainly due to the
start of the OL3 plant unit’s electricity production in
March 2022. Japan Credit Rating Agency (JCR) kept
its existing A+ rating (Negative Outlook).
TVO uses its right to borrow funds back from the

within the framework of legal regulations. On 31
December 2022, the amount of the loan was EUR
651.3 (711.3) million, and it has been relent to the
Company’s A series shareholders. On 31 March

Management Fund decreased by EUR 59.9 (31
March 2021: decreased by EUR 5.1) million.

capitalised in the balance sheet.
Share capital
TVO’s share capital on 31 December 2022 was EUR
600.4 (600.4) million.
The Company has 1,360,000,000 (1,360,000,000)
shares, of which 680,000,000 belong to the A series
and 680,000,000 to the B series. The A series shares
entitle to electricity generated at OL1 and OL2, and
the B series shares to the electricity generated at OL3.
Administrative principles
Because TVO is a non-listed public company
applying the cost-price principle, it observes the
Corporate Governance Code for listed companies
where applicable. TVO is not obligated to observe
the Corporate Governance Code nor therefore its




-
ment in its Annual Report or separately. TVO has

-
ment, which is published on the Company’s website
() at the same time
as this Report of the Board of Directors.
Administrative bodies
TVO’s administrative bodies and their operations in
2022 have been described in a separate Corporate

-
ny’s website .
Regulatory environment
The basic principle of nuclear energy legislation is
that the use of nuclear energy must be in line with
the overall good of society. The key regulations
governing the use of nuclear energy, the monitoring
of its use, and nuclear safety are included in the
Nuclear Energy Act and the Nuclear Energy Decree,
as well as in subordinate regulations issued by
them, such as Regulatory Guides on nuclear safety

to these, regulations applied to the use of nuclear
energy are included e.g. in the Radiation Act.
Work on the comprehensive reform of the Nuclear
Energy Act, initiated by the Ministry of Economic
Affairs and Employment (MEAE), has continued during
2022. The objective is that the production of nuclear
energy is in line with the overall good of society,

legislation draft is supposed to enter the consulta
-
tion phase during 2024, followed by a government

-
toral term, after which the new Nuclear Energy Act
would enter into force in 2028. TVO has participated
in the preparatory work of different working groups.

introduced at the OL1, OL2, and OL3 plant units.
The last updated guide (YVL E.6) will be introduced
during 2023.

regulations and guidelines, initiated in 2021, have
also continued during 2022. The aim is to lay down
the foundation and direction for the reform of regula
-
tions and guidelines, including the new YVL Guides.
TVO has participated in the preparatory work of

The Nuclear Liability Act concerns the liability the
operator of a nuclear power plant has in the event
of a nuclear incident. Amendments to the Nuclear
Liability Act entered into force with a Government
Decree as of the beginning of 2022. In the amend
-

in the Nuclear Liability Act) for a nuclear incident
outside of Finland was increased to EUR 1,200
million for nuclear plants used in energy production.
For nuclear incidents in Finland, the plant operator’s
liability remains unlimited, as it already has been
since 2012, when the Nuclear Liability Act was
temporarily amended as concerns this liability.
For nuclear plants used for purposes other than
energy production and for the transport of nuclear
substances, the liability is EUR 80–250 million.
The amendment to the Nuclear Energy Act
concerning the investment activities of the Finnish

into force on 1 January 2022. With the amendment,
the amount of relending available to a party with a
nuclear waste management obligation was limited
to 60 percent, and the investment activities were
expanded to also include other asset classes than
Finnish government bonds.
The use of nuclear energy is subject to licence.
Applications for a decision-in-principle, construction
licence and operating licence, as well as a licence for
decommissioning a nuclear power plant, are made

REPORT OF THE BOARD OF DIRECTORS AND FINANCIAL STATEMENTS 2022
5
REPORT OF THE BOARD OF DIRECTORS KEY FIGURES GROUP FINANCIAL STATEMENTS PARENT COMPANY FINANCIAL STATEMENTS FINANCIAL INFORMATION
monitoring the safety of nuclear energy use, and it
also supervises safety and emergency arrangements
and nuclear material safeguards.
Risk management, major risks and
uncertainties
RISK MANAGEMENT
The objective of risk management is to support the
realisation of TVO’s strategy and business objectives,
and to ensure that TVO’s operational preconditions
are maintained. Risk management is carried out
comprehensively according to the strategic objectives
set by the Board of Directors, Group-level policies,
and good governance.
Risk management is supervised by the Company’s

Group’s risk management policy. The Board of


that the company’s risk management is in line with
the TVO Group’s risk management policy. The

Group, is in charge of risk management in accordance
with TVO’s objectives and strategy. A Risk Manage
-
ment Group operates under the Management Group
and is in charge of ensuring adequate risk treatment

of risk management measures.

-
cation, analysis, and treatment of risks connected to
its operations, as well as the follow-up of measures.

strategic and operational planning and follow-up, and
also as part of project management.
RISK MANAGEMENT PROCESS
TVO has a Group-wide risk management process,
used to ensure that risks facing the Company’s

risk is treated according to its severity. The objec
-
tive of the risk management process is to manage
risks to an appropriate level set by the risk appetite.
Risks can be managed by reducing, avoiding,
sharing, moving, or accepting the realisation of
the risk. The acknowledged risks are gathered to
company-level risk registers, where all the risks

with each risk’s consequence and likelihood. The

Management Group, Audit and Finance Committee,
and the Board of Directors in accordance with the
annual management programme. Other risks are
reported to the necessary parties according to the
risk management process.
The comprehensive development of risk manage
-
ment is evaluated annually with a pre-set evaluation
form. The results from the evaluation are used to set
the goals for the development of risk management.
Risk management evaluation is performed with a
model based on risk maturity levels.
In 2022, TVO’s management and operational plan
-
ning process continued to increase the level and
effectiveness of risk management. Risk management
is a part of the Group’s strategy and, as such, it
is continuously being developed to help meet the
Group’s objectives within the Company’s risk appe
-
tite. During 2022, the role of risk management was
strengthened in operations through continuous
communication and collaboration, as well as empha-
sising the importance of risk management in project
management procedures. The risk management
process has also been updated during the year to
better support the Group’s needs. In 2022, a new
chapter on risk appetite was added to the risk
management policy.
MAJOR RISKS AND UNCERTAINTIES
Risks related to safety and electricity production
are reduced by keeping the plant units in good


and high-quality planning and implementation of the
annual outages.
Uranium, which is the fuel used for electricity
production, is procured from global markets. Risks
connected with nuclear fuel have been reduced by
procuring the fuel from a variety of suppliers and by
making long-term contracts.
In the OL3 project, risk management has primarily
been a question of overseeing and guiding the

of the turnkey contract and the settlement agree
-
ment, as well as enhancing TVOs preparedness.
The focus of risk management has shifted to

operation phase.
Indemnity and property risks are covered with
insurances. The aim of insurance management is
to keep the scope, cover, and cost of insurance at
a reasonable level. TVO is a member of European

liability insurance is in force for nuclear liability.
There are no major risks or uncertainties in view
concerning electricity production at the OL1 and OL2
plant units.
Financial risk management and fuel price risks are

statements, Note 27: Financial risk management.
RISKS RELATED TO OL3 PLANT UNIT
Schedule and planned completion
TVO’s major risks are related to the schedule of the

-


capacity of the plant unit. Under the plant contract,
electricity production was scheduled to start at the
end of April 2009. The completion of the project,
however, has been delayed. OL3’s regular electricity
production will commence in March 2023.
The risk related to the planned completion refers to a
situation in which commercial use cannot be started
as planned, which leads to additional costs.
During 2022, several risk management measures
related to the OL3 project have been executed to
improve TVO’s readiness to commission the plant unit
as well as to operate three nuclear power plant units.
TVO closely monitors the compliance of the conditions
set in the settlement agreement in March 2018 and
the amendments to the agreement in June 2021 and
ascertains that the commissioning of OL3 is executed



If OL3 fails to reach the projected output level, load
factor, or operating cost structure, or if the output
level is restricted by Finland’s main grid or it is not

to TVO from the system protection, there is a risk
that the production cost will rise in comparison to the
REPORT OF THE BOARD OF DIRECTORS AND FINANCIAL STATEMENTS 2022
6
REPORT OF THE BOARD OF DIRECTORS KEY FIGURES GROUP FINANCIAL STATEMENTS PARENT COMPANY FINANCIAL STATEMENTS FINANCIAL INFORMATION
objective. This risk has been analysed with the help

capacity. The risk has also been analysed as regards

the related costs resulting to TVO.
TVO implements several risk management meas
-

Examples of risk management measures include the
utilisation of the experiences from the Flamanville
and Taishan sister plants during the nuclear
commissioning of OL3.
MAJOR PLANT MODIFICATIONS AND THEIR
IMPLEMENTATION
Increase of production costs and deterioration of

-


and assign responsibility for requirements related to
nuclear safety and to ensure that the project parties
meet these requirements in advance to avoid unex
-
pected costs during the project.
In risk assessment, increased project costs are viewed
to arise either from inadequate preparation and require
-

challenges in the execution of the licensing process, or

As risk management measures, TVO has in 2022
continued to prioritise projects and measures that are
most vital in view of the schedule and costs in order
to secure adequate resourcing for them. Furthermore,
TVO aims to ensure that project suppliers have the
readiness and interests to complete the projects they
are involved in, especially considering the effects of
the war in Ukraine.
ORGANISATION’S CAPABILITIES
An organisations competence and ability to function
as a licensee may be compromised by dysfunctional
management, failed reaction to changes in the
operational environment, or a negative atmosphere
of the work community. In addition to the rise of
immediate costs, this may also lead to an increased
likelihood of other risks being realised.
In order to maintain its capability to function as a
licensee, TVO has prepared for the operation phase
of OL3 and for future retirements by recruiting 87
new staff members in 2022 and by maintaining
a comprehensive supplier chain. TVO’s sick leave
percentage was 3.8 and the outgoing turnover rate
was 6.7 percent. To support supervisors’ leadership

on safety leadership has been organised.
Furthermore, TVO has also executed a competence
survey, the results of which are used for personnel
planning. OL3 trainings have continued during 2022.
TVO has undertaken measures to further develop its
work community culture and to strengthen its safety
culture. TVO conducts a personnel survey approxi
-
mately every 18 months, and the next survey is to be
conducted in the beginning of 2023.
FINANCIAL AND LIQUIDITY RISKS

liquidity, market, and credit risks. By diversifying

-


reorganising bilateral bank loans and issuing a new
bond. TVO has reduced market risks by making use
of interest rate and currency derivatives. According

-
nated in foreign currencies will be hedged to the euro
until the maturity date by using derivatives.
Financing costs are impacted by the changes in TVO’s
credit rating and outlooks as well as market changes
to interest rates and corporate loan margins. There is a

This risk has been analysed through various scenarios
based on the changes in the average interest rate and
margin of TVO’s loan portfolio. If the risk is realised,
the consequences include an increased cost of



sources in diverse ways. In addition to the interna
-
tional capital market, the Company also acquires

institutions. Credit ratings play a major role in capital

Financing is used to secure TVO’s liquidity under
all circumstances. For this purpose, the Company

various revolving credit facilities and liquid assets.
It is TVO’s basic principle to acquire about three

market and one quarter from its shareholders. TVO


separate projects.

TVO’s operations has remained strong also in 2022.

-

of a new bond, and the extension of the shareholder
loan commitment during the year.
INCREASE IN THE COST OF FINAL DISPOSAL OF
SPENT NUCLEAR FUEL
-
mented according to plan, project costs rise, or
the completion of the project is delayed, the cost


management liability of spent fuel.
As risk management measures in 2022, the cost


and commenced, and contracts for the production

RISKS RELATED TO SOCIAL AND PERSONNEL
MATTERS, RESPECT OF HUMAN RIGHTS AND
RISKS RELATED TO CORRUPTION AND BRIBERY
Risks related to social and personnel matters and
the respect of human rights, as well as risks related
to corruption and bribery constitute one area of the

-
cant risks affecting the Company’s operations have
been detected in the aforementioned matters during
2022. The possible risks detected in these areas are
addressed according to the Company’s ordinary risk
management process.
Continuous risk management in these matters is
executed according to the TVO Group’s Code of
Conduct. The internal auditor supervises the imple
-
mentation of the Code of Conduct in the Company’s
operations. The TVO Group has a whistleblower
channel in place, through which incidents perceived
to be against the Code of Conduct can be reported
also completely anonymously. The possible risks are
evaluated in projects and investments where neces
-
sary. Furthermore, the matters are evaluated when
REPORT OF THE BOARD OF DIRECTORS AND FINANCIAL STATEMENTS 2022
7
REPORT OF THE BOARD OF DIRECTORS KEY FIGURES GROUP FINANCIAL STATEMENTS PARENT COMPANY FINANCIAL STATEMENTS FINANCIAL INFORMATION
reviewing suppliers in accordance with
a separate supplier review procedure.
TVO’s principles and results of ethical
business are described in more detail in
the chapter on Responsibility.
Pending court cases and
disputes
In August 2022, the arbitral tribunal
resolved all the claims presented to each
other by TVO and Wärtsilä Finland Oy
concerning the delivery schedules, addi
-
tional costs, and delay liquidated damages
of the diesel generators at the Olkiluoto
nuclear power plant. Therefore, at the end
of the accounting period 2022, TVO has
no pending court cases or disputes.
Electricity production
The electricity production of OL1, OL2,
and OL3 in 2022 was 16,351 (14,438)
GWh, and the total load factor of OL1
and OL2 was 93.0 (92.8) percent.
The plant units operated safely. OL3
was connected to the national grid for

plant unit’s test production phase is
currently ongoing. OL1’s net production
was 6,932 (7,404) GWh and load
factor 89.1 (95.1) percent. OL2’s net
production was 7,532 (7,033) GWh and
load factor 96.8 (90.4) percent. A record
production result was reached at OL2.
OL3’s net production was 1,887 GWh
and load factor 16.9 percent.
Taulukko 1
Pvm
OL1
1.1.2022
899,5
2.1.2022
899,4
3.1.2022
899,2
4.1.2022
899,4
5.1.2022
899,3
6.1.2022
899,6
7.1.2022
899,4
8.1.2022
899,4
9.1.2022
899,4
10.1.2022
899,1
11.1.2022
899,1
12.1.2022
899,4
Pvm
January
1. Annual outage
2. Cold shutdown to remove damaged fuel
1
OL1 Production
Average output
MW
1,000
750
500
250
0
May
July
August
October
December
2
1
Taulukko 1
Pvm
OL2
1.1.2022
894,4
2.1.2022
894,8
3.1.2022
894,7
4.1.2022
894,5
5.1.2022
894,7
6.1.2022
894,6
7.1.2022
894,5
8.1.2022
894,3
9.1.2022
894,5
10.1.2022
894,4
11.1.2022
894,5
12.1.2022
894,3
Pvm
1. Annual outage
1
OL2 Production
Average output
MW
1,000
750
500
250
0
January
May
July
August
October
December
1
Taulukko 1
Pvm
OL3
1.1.2022
0,0
2.1.2022
0,0
3.1.2022
0,0
4.1.2022
0,0
5.1.2022
0,0
6.1.2022
0,0
7.1.2022
0,0
8.1.2022
0,0
9.1.2022
0,0
10.1.2022
0,0
11.1.2022
0,0
12.1.2022
0,0
Pvm
OL3 Production
Average output
MW
1,700
1,275
850
425
0
January
May
July
August
October
December
1. Generator and turbine island repair works
2. Automation updates at the turbine island
3. Turbine island maintenance outage
1
2
3
1
Generator and turbine
island repair works
Automation updates
at the turbine island
Turbine island
maintenance outage
Annual outage
Annual outage
Cold shutdown to remove damaged fuel
REPORT OF THE BOARD OF DIRECTORS AND FINANCIAL STATEMENTS 2022
8
REPORT OF THE BOARD OF DIRECTORS KEY FIGURES GROUP FINANCIAL STATEMENTS PARENT COMPANY FINANCIAL STATEMENTS FINANCIAL INFORMATION
OL3’s power output during the test production phase
is published on TVO’s website at 
ol3forecast. An Urgent Market Message is published

SIGNIFICANT PLANT EVENTS AT OL1 AND OL2
As a result of the transfer of spent fuel on 22 October
2021 and the return of the empty transfer cask to
the OL1 plant unit on 8 November 2021, radioactive
particles ended up on the transfer cask’s transport
equipment, in the transport corridor of the spent fuel
storage non-radioactive controlled area, and two
particles on the transport route in the plant yard area.

-
tions was completed in spring 2022. The incident did
not result in radiation doses to people, and radiation
safety was not endangered. However, the incident



2022. Based on the related incident investigation,

-

neglect of inspection rounds, related registrations into
information systems, as well as non-interference into



measures have been carried out during 2022.
Indications of damaged fuel were detected at the OL1
plant unit at the end of June 2022. As a result, the
power level of the plant unit had to be reduced in July

fuel element, and thereafter an approximately
week-long maintenance was started to remove the
damaged fuel element and replace it with a new one.
Annual outages
The refuelling and maintenance outages carried out
at the plant units on alternating years are designed
to ensure that a good level of operability and produc
-
tion is maintained at the Olkiluoto nuclear power
plant at all times.
The annual outages in 2022 of the OL1 and OL2
plant units started on 24 April with the refuelling
outage at the OL2 plant unit. In addition to refuel
-
ling, various annual preventive maintenance activi-
ties, inspections, repairs, and tests were carried out
at OL2. The plant unit continued electricity produc
-
tion on 3 May.
A maintenance outage was carried out at the OL1
plant unit, which started on 8 May and ended on

-
cant tasks of the maintenance outage included the
replacement of pumps and valves in the shutdown
cooling system, inspection of the reactor pressure
vessel’s bottom, renewal of electrical bushing
assemblies in the containment, maintenance acti-
vities in the service water channel and concreting
one of the service water channels, replacement of
impellers in feedwater pumps, installation of a new
recirculation line, and a pressure test of the reactor
containment.
The annual outages were carried out successfully
despite special arrangements due to COVID-19.
The aim of the extensive special arrangements and
measures was to prevent the spread of potential
COVID-19 infections in Olkiluoto, ensure the health
and safety of the persons involved in the annual
outages, as well as guarantee a safe and high-quality
annual outage.
Two accidents at work resulting in absence occurred
during the annual outages.
In addition to TVO’s own personnel, approximately
490 external resources participated in the refuelling
outage and approximately 830 external resources
worked in the maintenance outage. Around 190
specialists arrived from abroad for the annual outages.
Olkiluoto 3 EPR
OL3, currently under the test production phase, was




and several liability for the contractual obligations.
In March 2018, TVO signed a comprehensive Global

-
tion of the OL3 project and related disputes with




amended with agreements signed in June 2021.

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

costs for completing the OL3 project. During the
accounting period, the fund, which was previously
replenished by Areva in July 2021, has been used to
cover costs incurred to the Areva companies for the
completion of the OL3 project in accordance with


additional delay compensation accumulated by the
end of the accounting period in accordance with the
amended settlement agreement.


2023. In addition, the payment of approximately EUR
193 million of the delay compensation agreed upon

-
tion of OL3, up to 31 March 2023 at the latest.

schedule, TVO’s current cost estimate, and the

investment in the OL3 project will be approximately
EUR 5.8 billion.

-
ers workforce at OL3 was approximately 900
people. The occupational safety at the site remained
at a good level.
All realised costs of the OL3 project that can be
recognised in the cost of the asset have been entered
as property, plant, and equipment in the Group
balance sheet.
SIGNIFICANT EVENTS AT OL3
On 12 March 2022, OL3 was connected to the
national grid and electricity production started. The
electricity power level was gradually increased to
approximately 850 megawatts, until the production
tests were interrupted on 26 April 2022 due to the

-
ously, a leak in the generator’s cooling system was
observed. Foreign material detached from the steam
guide plates was found in the turbine’s steam reheater
REPORT OF THE BOARD OF DIRECTORS AND FINANCIAL STATEMENTS 2022
9
REPORT OF THE BOARD OF DIRECTORS KEY FIGURES GROUP FINANCIAL STATEMENTS PARENT COMPANY FINANCIAL STATEMENTS FINANCIAL INFORMATION
in May 2022, which required repair work. The work
was completed on 8 August 2022. TVO communi
-
cated on 11 August 2022 that a turbine automation
update of approximately two weeks would be carried
out. The test production continued on 28 August
2022 with tests at a 60 percent power level.

increase OL3’s power level to over 60 percent and

the production tests and investigations conducted
so far showed that OL3 has worked safely, and
that increasing the plant unit’s power level can be
continued. Tests at an 80 percent power level were

approximately 1,600 megawatts, were started on 30

on 18 October 2022 due to damage detected in
the internals of the feedwater pumps at the turbine
island. Test production was continued on 27
December 2022 after investigations into the damage
were mainly completed.





agreements.
Nuclear fuel
In 2022, nuclear fuel purchases amounted to EUR
60.8 (61.8) million and the amount consumed to EUR
69.7 (61.4) million.
The nuclear fuel and uranium stock carrying value on
31 December 2022 was EUR 262.4 (265.9) million.
Once the OL3 plant unit proceeds to commercial
operation, approximately EUR 250 million will be
transferred from the OL3 investment to the value of
the nuclear fuel and uranium stock.
Nuclear waste management
Under the Finnish Nuclear Energy Act, the Company
is responsible for the measures related to nuclear
waste management and the related costs.

-
ment show a provision related to nuclear waste
management liability of EUR 1,294.3 (1,368.3)

accounting principles. TVO’s share in the Finnish

(1,010.1) million, is presented under assets, calcu
-
lated according to the IFRIC 5 interpretation. The
total cost estimate based on a new nuclear waste
management technical plan and schedule has been
updated in June 2022.
The cost estimate of nuclear waste management for

-
ment scheme for 2022–2024, the preliminary nuclear
waste management scheme for 2025–2026, as
well as total costs for 2027–2028 were submitted
to the MEAE at the end of June. The amount of the
nuclear waste management fee to be collected from
a company liable for nuclear waste management is
based on the nuclear waste management scheme.
In order to cover the future costs of nuclear waste
management, TVO makes contributions to the Finnish

dance with the Nuclear Energy Act. In December
2022, the MEAE set TVO’s liability for nuclear waste
management at EUR 1,839.6 (1,816.1) million for the
end of 2022 and the Company’s funding target for
2023 at EUR 1,457.9 (1,436.1) million.


management fee refund for 2020 at EUR 28.7 million,
which the Fund reimbursed to TVO on 31 March
2021. As for 2021, no surplus was reimbursed to
TVO from the Nuclear Waste Management Fund
after the amendment to the Nuclear Energy Act

waste management in 2022 was lower than the share
in the Fund in 2021. The refund for 2021, EUR 14.5
million, was used to cover the protected portion in

In accordance with the implementing provision of the


was not used to refund TVO’s nuclear waste manage
-
ment fee, but it was also used to cover the protected
portion. In order to supplement the legal protected
portion, TVO provided the Nuclear Waste Manage
-
ment Fund with a separate cash security of EUR 7.4

the Nuclear Waste Management Fund started invest
-
ment activities in accordance with new legislation.
The Nuclear Waste Management Fund made a loss,
which raised TVO’s nuclear waste management fee
for 2022, as well as required the Company to provide
additional securities to cover the legal protected
portion. The nuclear waste management fee for 2022

A total of approximately 8,400 (8,165) m
3
of low and
medium level radioactive waste has accumulated
from the OL1 and OL2 plant units during their ope-

for low and medium level waste (VLJ repository) in
Olkiluoto.
The total amount of spent nuclear fuel by the end of
the year was 1,661 (1,630) tonnes, of which 32 (33)
tonnes accumulated in 2022. The spent fuel is stored
in the fuel pools of the plant units and in an interim

FINAL DISPOSAL OF SPENT NUCLEAR FUEL

spent nuclear fuel generated at the power plants of

Heat Oy (Fortum) in Loviisa.

building phase of the encapsulation plant and the


ongoing EKA project entails the implementation of
the encapsulation plant as a whole, the additional

the installation of the systems needed for the start

setting up the supply chains necessary for produc
-
tion operations.

-
cation was submitted to the Finnish Government in
December 2021, and its processing has advanced
according to plan. In 2022, the construction of the
nuclear facilities proceeded to the installation and
commissioning phase, and operations at the encap
-
sulation plant are in accordance with its practices.

completion of the encapsulation plant’s construction
work ready for installations, as well as the completion

REPORT OF THE BOARD OF DIRECTORS AND FINANCIAL STATEMENTS 2022
10
REPORT OF THE BOARD OF DIRECTORS KEY FIGURES GROUP FINANCIAL STATEMENTS PARENT COMPANY FINANCIAL STATEMENTS FINANCIAL INFORMATION
in June at a depth of 430 metres. The underground
installations of civil and building technology also
progressed well and on schedule.
The manufacture of the encapsulation plant’s central
systems is under way. In 2022, installations included
the handling cell’s drying station and the canister’s
welding station. A disposal hole drilling rig has been



fuel element copies) planned for the end of 2023 was
postponed by six months.
The preparation of supply chains for the canister
and bentonite components needed in production
activities progressed. The equipment installations of

were completed, and more supplier options were
sought for the canister components. The operators of

-
tory were also recruited during 2022.

nuclear waste management for 2021 to the MEAE
at the end of March 2022. In June 2022, the nuclear
waste management scheme for 2022–2026 was
submitted to the MEAE, which contains an estimate

provision.
Research and development
The main objective of TVO’s research and develop-
ment (R&D) activities is to ensure the viability of
the existing business functions and to create new
business opportunities for the TVO Group. The TVO
Group’s R&D activities were reorganised during
2022. The objective of the reorganisation is to
create a clear process and basic principles for R&D
activities, so that they more clearly serve the needs
emerging from within the Group.
The main subject areas of R&D activities include the
operation and lifecycle management of nuclear power

waste and spent nuclear fuel, and the creation of
new business opportunities for the TVO Group.
R&D costs were EUR 10.3 (11.5) million, most of
which were used for R&D activities related to nuclear
waste management.

research programmes for reactor safety and nuclear
waste management. In 2022, TVO’s contribution to


5.4 (5.1) million.
Acquisitions of tangible and intangible
assets and shares
Investments in 2022 were EUR 311.8 (578.1) million.
In 2021, the current value of the provision related to
the OL3 plant unit’s decommissioning, a total of EUR
367.9 million, was recorded as an investment in the
balance sheet.
Investments of the parent company were EUR 339.0
(219.6) million, of which EUR 276.0 (163.6) million
were allocated to the OL3 project, and EUR 63.0
(56.0) million were allocated to the OL1 and OL2
plant units and the general infrastructure of the
area. The OL3 investment is decreased by the delay
compensation and additional delay compensation in

-
sation has been recorded as EUR 56.7 million for the
accounting period.
Hitachi Energy and TVO have signed a contract in
2021 about delivering one of Europe’s largest battery
energy storage systems to Olkiluoto. The 90-mega
-
watt system will support the entire energy network
in a potential production disturbance of the OL3 plant

on the grid as part of Fingrid’s system protection. The
battery energy storage system is in the deployment

Carbon dioxide emission allowances have been relin
-
quished to the Energy Authority worth EUR 0.1 (0.1)
million. In 2022, emission allowances were acquired
worth EUR 0.1 (0.2) million. The Company’s need for
carbon dioxide emission allowances for the accounting
period was covered by acquired emission allowances.
Responsibility
Responsibility is one of TVO’s values. The TVO

environment, people, and the economy through
a materiality analysis updated during 2022. The
material impacts include:
1. 
2. 
competence
3. Transparent and ethical business
4. Responsibility in the supply chains and partnerships
5. Creation of added economic value
6. The support and development of employees
competence
7. Healthy and equal work community
8. Biodiversity and sustainable land use
9. Minimising releases into the air, water, and soil
10. 
The TVO Group and its entire personnel are committed
to a high-standard safety culture (see chapter: Safety).
The Group-level policies, approved by the Manage
-
ment Group, outline key objectives related to respon-
sible operations. Group-level policies include:
»
Nuclear safety and quality policy (nuclear safety, radiation
protection, nuclear material safeguards, and quality)
»
Corporate social responsibility policy (environment and

safety, and communications)
»

well as increasing the production capacity)
»
Corporate safety policy (safety of production and
activities as well as the safety of people and facilities,
rescue and emergency activities, and data security).
The principles of responsible business operations
are described in the TVO Group’s Code of Conduct,
which is approved by the Company’s Board of
Directors and applies to the entire personnel as
well as all partners and subcontractors. The Code
of Conduct includes separate parts for the Groups
personnel as well as partners and subcontractors.
The TVO Group’s Code of Conduct complies with
OECD’s Guidelines for Multinational Enterprises.
TVO considers any non-compliance with its Code
of Conduct unacceptable. The Code of Conduct
is published on TVO’s website at 
code-of-conduct.
REPORT OF THE BOARD OF DIRECTORS AND FINANCIAL STATEMENTS 2022
11
REPORT OF THE BOARD OF DIRECTORS KEY FIGURES GROUP FINANCIAL STATEMENTS PARENT COMPANY FINANCIAL STATEMENTS FINANCIAL INFORMATION
The TVO Group is committed to promoting the

-
ment Goals in its operations:
NUCLEAR PROFESSIONALISM
The development of management principles and
working policies in a nuclear power plant has been

in other words expectations for working in a nuclear

expectations. The expectations for a nuclear profes
-
sional are a part of TVO’s activity-based manage-
ment system.
During 2022, measures aimed at developing
nuclear professionalism were continued. A training
programme for safety management (Nuclear

was expanded with in-depth sections in 2022. In

with coaching discussions that particularly aimed at
reinforcing the consideration of human and organisa
-
tional factors in the conversations that take place in

management was developed further by clarifying
supervisor level roles and describing the essential
cross-organisational processes in more detail. The

-
oping nuclear professionalism and thinking of ways
in which human factors could be taken into consider
-
ation even better in everyday life.
RESULTS OF ETHICAL BUSINESS
TVO does not tolerate any kind of corruption or
bribery. The Code of Conduct requires employees to
refrain from transactions and retreat from situations

of the Company and the individual. The Company
maintains a register on the engagements of speci
-

regarding hospitality practices, related party trans
-
actions, and the processing of insider information,
as well as compliance principles and procedure
accepted by the Board of Directors. Detailed instruc
-
tions are available regarding the approval procedure
of TVO’s commitments (procurement agreements,
orders, invoices, etc.).
TVO respects the human rights of all people affected
by the Company’s operations and expects the same
from all companies acting in its supply and subcon
-
tracting chains. TVO’s objective is to guarantee good
working conditions for all employees. In accordance
with its Code of Conduct, TVO does not condone any
kind of discrimination or harassment on the grounds
of age, gender, ethnic origin, religion, beliefs, opin
-
ions, or other personal characteristics. TVO observes
an equality plan.
All personnel, partner, and subcontractor activities
in Olkiluoto are supervised by TVO. TVO only trades
with evaluated and approved suppliers. All products
and services acquired must meet the require
-
ments of TVO’s safety, quality, and environmental
standards as well as the principles of responsible
business described in the Code of Conduct. TVO’s
supplier review process also includes active
monitoring and periodical reviewing of suppliers.
Through supplier reviews, the Company ensures
that suppliers follow good practices related to
environmental, personnel, and quality management
issues. During 2022, 111 suppliers were reviewed
by using various methods.
TVO has a procedure for reporting suspected viola
-
tions of the Code of Conduct and abuses of insider

-
mously. TVO’s internal audit processes all concerns
regarding possible violations against the Code of
Conduct or abuses of insider information in such a
 
Reputation index > 75 82

category
69.8/A+ 68.7/A
Reports suspecting violations of
the Company’s Code of Conduct
- 6
 - 3.8
Occupational accident
frequency
1.6 4.8
Collective radiation dose,

992 789
Number of environmental
incidents, pcs
0 0
Unplanned energy unavailability

< 0.6 1.0
Number of unplanned automatic
scrams, pcs
0 1
Reputation index: The TVO Group stakeholder survey, average
of respondent groups 0–100; under 50=Weak, 50–62=Moderate,
62–70=Good, over 70=Excellent. The survey is conducted and
the results are reported every two years. The next survey will be
conducted in 2023.
Personnel survey: The personnel survey was conducted at the end
of 2021. The survey is conducted every 18 months. The evaluation
scale from highest to lowest result is AAA–C, where A is satisfactory.
Occupational accident frequency: per million working hours. The

subcontractors.
Collective radiation dose: World Association of Nuclear Operators

Goal: the best quarter.
Environmental incidents:
Unplanned energy unavailability factor: 
TVO reports on its corporate responsibility in
accordance with the Global Reporting Initiative (GRI)

published on the Company’s webpage 
. TVO’s sustainability reporting
has been subjected to a limited audit by an external
party. The information in the Environmental Report,

external party.
RESPONSIBILITY OBJECTIVES AND RESULTS
The responsibility objectives are based on the
principle of continuous improvement. The objectives
enable the Company to monitor the realisation of
material responsibility issues. The TVO Group’s
broader sustainability objectives are reported in




-


REPORT OF THE BOARD OF DIRECTORS AND FINANCIAL STATEMENTS 2022
12
REPORT OF THE BOARD OF DIRECTORS KEY FIGURES GROUP FINANCIAL STATEMENTS PARENT COMPANY FINANCIAL STATEMENTS FINANCIAL INFORMATION
manner that the rights and the privacy of both the
person raising the concern and the alleged violator
are protected under all circumstances.

possible violations against the TVO Group’s Code
of Conduct in 2022 and implemented necessary

audit reports to the Audit and and Finance
Committee and the Board of Directors.
organisation, and personnel. The overall level of
safety is good.
The state of the safety culture is regularly assessed
according to the International Atomic Energy Agency
(IAEA) procedure. TVO’s safety culture is estimated
to be at a level at which the strategic importance of
safety has been recognised and preventative prac
-
tices are observed. TVO aims at reaching the highest
possible level of safety culture. TVO has continued
to employ various measures to maintain and develop
the Company’s safety culture.
The Company regularly assesses and develops
the operations of its plant units with the help of
internationally used safety indicators. Of the safety
indicators, collective radiation dose, unplanned
energy unavailability factor, and unplanned auto
-
matic scrams realisation are described in the table
“Responsibility objectives and results” (see chapter:
Responsibility).
The Olkiluoto nuclear power plant units, OL1, OL2,
and OL3, operated safely throughout the year. TVO





with safety effects). TVO investigates all events with

-
tive measures for their causes. TVO publishes infor-

in the News section of the Company’s website.

Occupational health and safety activities are guided


construction operations at the OL3 site in the areas
where TVO is responsible.

monitor, and develop occupational safety activities.
The Group has responsible contractors working in
Olkiluoto, who follow the Group’s expectations and
adhere to common principles. The most important

responsibilities of the line organisation, supporting
supervisors in their work, strengthening contractor
cooperation, and developing the processes for
identifying hazards and managing risks so that they
include psychosocial risk factors. During 2022, a
foundation and steps for progress were created for
the long-term development of occupational safety
with an occupational safety development programme.
The TVO Group’s goal for accident frequency in
2022 was 1.6 (accidents per million work hours).
Two occupational accidents resulting in absence
occurred during the annual outages. The goal for
accident frequency was not achieved since the
accident frequency in Olkiluoto was 4.8 in 2022.

working in Olkiluoto are included in the accident
frequency calculation, excluding the OL3 site,
which is reported by the plant supplier consortium



THE ENVIRONMENT
TVO is committed to observing the principles of
sustainable development, and environmental respon
-
sibility is a part of the Company’s management

management systems meet the requirements of


improvement and raising the level of environmental
protection. TVO’s system is also Eco-Management

TVO recognises the environmental and energy
aspects of its operations and works to minimise
their negative impacts at all stages of the electricity
production chain. Risks related to the environment


Through risk management, the Company aims to
foresee possible divergent situations and to mitigate
their negative consequences on the environment.
TVO constantly monitors the environmental impacts
of its operations.
The Company’s operations met the requirements set
in legislation, environmental permits, and the envi
-
ronmental management system in 2022. The most

nuclear power plant are the production of climate-
friendly electricity and the local warming of the sea
water near the plant. During the reporting period, the
electricity production of the Olkiluoto nuclear power
plant was 16.35 TWh. The amount of cooling water
increased in 2022 due to the commissioning of OL3,
but the temperature of cooling water remained within
the limits required by the environmental permit.
As in previous years, the environmental load caused
by the Olkiluoto nuclear power plant was minimal in
2022. A report was provided to the environmental
authority regarding malfunctions at the debris
handling building for the OL1 and OL2 plant units.







the Code of Conduct

to corruption, bribery, extortion,

inappropriate behaviour)
6 6
Others
(not related to the Code of Conduct) 0 0
SAFETY AND OCCUPATIONAL SAFETY

The safe use of the Olkiluoto nuclear power plant
relies on competent and responsible personnel, high-
quality plant technology, the principle of continuous
improvement, and independent internal and external
supervision. TVO’s activity-based management

standard. In order to ensure safe operation, TVO
systematically assesses the level of safety and safety
culture, and all TVO employees are committed to a
high-quality safety culture.
TVO regularly assesses the state of its overall safety
from the viewpoints of production, nuclear safety,
safety and service life management, leadership,
REPORT OF THE BOARD OF DIRECTORS AND FINANCIAL STATEMENTS 2022
13
REPORT OF THE BOARD OF DIRECTORS KEY FIGURES GROUP FINANCIAL STATEMENTS PARENT COMPANY FINANCIAL STATEMENTS FINANCIAL INFORMATION

handling building during spring 2023. Radioactive
emissions into the air and water were clearly below
annual regulatory limits.
Low levels of tritium were observed in water and air
samples taken from the VLJ repository in May 2022.
The tritium amounts detected in the repository were
low and estimated to be comparable to the amount
of background radiation in nature.
Operations were developed in accordance with
the regulations of environmental permits and the
environmental management system. In accordance
with the principle of continuous improvement, the

goals for the Company’s operations. The programme
is regularly monitored by a team of environmental
experts from various organisational units. TVO is also

-
ny’s total energy savings target for the agreement
period 2017–2025 is 150 GWh. The target was
already reached in 2019. Therefore, an additional
target of 500 MWh was set for 2022–2023.
In 2022, the Olkiluoto water management security
project for securing the supply of raw water and
building a transfer sewer for wastewater progressed
according to plan. At the end of the year, extension
work of the district heating network was started.

to the environment, as well as the results of the

reported in further detail in the Environmental Report
published separately. The information has been

GROUP PERSONNEL AND TRAINING
Personnel
The TVO Group’s Code of Conduct and policies lay
down the principles of the personnel policy. TVO
aims to provide a healthy, equal work community that
promotes equality and does not condone any form of
discrimination.
At the year-end, the total number of personnel in the
Group was 1,007 (984), and the average during the
year was 1,031 (1,004). The year-end total number of
personnel in TVO was 1,005 (982), and the average
during the year was 1,029 (1,002). The year-end total
for TVO’s permanent personnel was 984 (963).
TVO recruited 87 (70) employees in 2022. During
the year, 66 (61) permanent employees left the
Company, including 16 (5) who retired. TVO’s sick
leave percentage was 3.8 (2.4).
Veli-Pekka Nurmi


Mikko Lampinen was appointed as


Sami
Jakonen, was appointed as a Corporate Advisor
with responsibility for the Company’s separate
technical projects.
The collective agreements for different groups of
personnel in the energy industry are in force in
accordance with the so-called framework agreement
of labour confederations until the beginning of 2023.
100 percent of TVO employees are working under
collective agreement.
The TVO Group continued preparations for possible
COVID-19 infections during the year, and the spread
of the virus was prevented through several measures
on the Olkiluoto island. The effectiveness of the
measures was deemed successful, since COVID-19
transmission chains were avoided in Olkiluoto. The
restrictions were lifted during the summer, and
national and regional instructions are followed in the
COVID-19 guidelines.
A personnel survey is carried out in the Group
approximately every 18 months. The results of the

received in November 2021. The response rate was

represents the overall result, was 68.7 (2020: 66.0).
The result clearly increased from the previous survey,
although the rating remained in category A (satisfac
-
tory). The next personnel survey will be conducted in
the beginning of 2023.

monitored in navigation discussions held three times


instructed in the general and professional induction
training of new employees before new recruits begin

interviews of new employees and exit interviews
of personnel leaving the Group, and the results are
utilised in developing operations.
The Group’s management and operational culture
is developed with the help of the Better Workplace


preconditions for operations by developing issues
related to the work of each individual, the immediate
work community, and the entire Group. The progress
of the programme is monitored on a regular basis,
and the effectiveness is measured with e.g. regular
personnel surveys. In 2022, one of the themes of the
programme has been working together, which has
included building the Group’s guidelines for a new
model of working, increasing collaboration between
the different organisational units, and involving the
personnel in the strategy process. Another theme has
been smooth everyday work, which included exami-
ning the key decision-making forums, considering

culture, as well as the use of new digital tools as part
of a new way of working.
The focus of occupational health care has continued
to be on preventative occupational health care,
which supports the employees health, work and
functioning abilities, as well as their maintenance and
development.
The human resource issues and indicators for 2022
can be found in more detail in the Annual and


An annual training programme is implemented in
the TVO Group as a tool for personnel develop
-
ment and the planning of trainings. The annual
training programme includes trainings organised
by the Group which are planned to be implemented
during the next calendar year. The annual training
programme is drawn up to correspond with the
strategic focus areas and goals for operations deter
-
mined by the Group’s management.
The basic, continuing, and further training of the TVO
Group employees was implemented according to the
REPORT OF THE BOARD OF DIRECTORS AND FINANCIAL STATEMENTS 2022
14
REPORT OF THE BOARD OF DIRECTORS KEY FIGURES GROUP FINANCIAL STATEMENTS PARENT COMPANY FINANCIAL STATEMENTS FINANCIAL INFORMATION
annual training programme as in previous years. The
personnel were trained for a total of 11,680 (10,608)
days, on average 11.6 (10.8) days per each TVO

In 2022, OL1, OL2, and OL3 operators attended
operational training days and advanced simulator
courses in the spring and in the autumn according to
their training programme. OL3 operators worked in
shifts in the combined operating organisation of the

-
tion and monitoring tasks.

initiated in 2021 to develop supervisor skills, was
continued. The aim of the programme is to prepare
supervisors for their tasks within the nuclear industry
in more comprehensive ways than before.
Cooperation with educational institutions was
deepened with several actors. The goal is to create
even closer ties between the Company and students
and to offer students diverse thesis opportunities and
trainee positions.
TVO participated in the implementation of a national
nuclear safety and waste management training course
together with other major operators in the industry.

power plants, TVO also participated in the Nordic

training is to raise the students’ interest towards the
nuclear industry as an employer and to help them see
the opportunities nuclear power can offer in the future.
Key issues and indicators for 2022 related to compe
-
tence management are reported in more detail in the

EU TAXONOMY REPORTING

its delegated acts formulate a robust and science-
based framework for companies and investors that
provides environmental criteria for determining which

-
mentally sustainable in the EU. The aim is to make
it easier and more uniform to identify sustainable
investment targets and direct investments to these


»
climate change mitigation
»
climate change adaptation
»
the sustainable use and protection of water and marine
resources
»
the transition to a circular economy
»
pollution prevention and control
»
the protection and restoration of biodiversity and ecosystems.
To qualify as environmentally sustainable, compa-
nies need to ensure that their economic activities
substantially contribute to one of the environmental

harm to any of the other (technical screening criteria).
To be aligned, companies also need to run their
operations according to a set of minimum safeguards
aimed to ensure companies follow the most impor
-
tant human rights related principles.

The technical screening criteria are currently
available for two objectives: climate change miti
-



by including technical screening criteria for certain
activities related to nuclear energy production.
Nuclear energy and activities related to nuclear
energy are low-carbon activities that can substan
-
tially contribute to climate change mitigation. Nuclear
energy generation has near to zero greenhouse
gas emissions in the energy generation phase. In
the EU Taxonomy, nuclear energy related economic

activities. Nuclear energy facilitates the deployment
of renewable energy sources and does not hamper
the development of low carbon alternatives.

-


-
tion on how and to what extent their activities asso-
ciate with economic activities that qualify as environ-
mentally sustainable. TVO is in the scope of the NFRD


related to the production of nuclear energy. TVO is

related to its eligible and aligned activities.
Nuclear and fossil gas related activities as required by
the Disclosures Delegated Act Article 8 (6–8)
 
1. The undertaking carries out, funds or has exposures to research, development, demonstration and
deployment of innovative electricity generation facilities that produce energy from nuclear processes
with minimal waste from the fuel cycle. NO
2. The undertaking carries out, funds or has exposures to construction and safe operation of new nuclear
installations to produce electricity or process heat, including for the purposes of district heating or industrial
processes such as hydrogen production, as well as their safety upgrades, using best available technologies. YES
3. The undertaking carries out, funds or has exposures to safe operation of existing nuclear installations
that produce electricity or process heat, including for the purposes of district heating or industrial
processes such as hydrogen production from nuclear energy, as well as their safety upgrades. YES

4. The undertaking carries out, funds or has exposures to construction or operation of electricity generation
facilities that produce electricity using fossil gaseous fuels. NO
5. The undertaking carries out, funds or has exposures to construction, refurbishment, and operation of
 NO
6. The undertaking carries out, funds or has exposures to construction, refurbishment and operation of
 NO
REPORT OF THE BOARD OF DIRECTORS AND FINANCIAL STATEMENTS 2022
15
REPORT OF THE BOARD OF DIRECTORS KEY FIGURES GROUP FINANCIAL STATEMENTS PARENT COMPANY FINANCIAL STATEMENTS FINANCIAL INFORMATION
TVO’s EU Taxonomy disclosure was prepared in
accordance with the EU Taxonomy Regulation

screening criteria in the consolidated Climate Dele
-
gated Act of 1 January 2023 (Commission Delegated

requirements in the consolidated Disclosures Dele
-
gated Act of 1 January 2023 (Commission Delegated


calculation methods
The TVO Group reports the proportion of the taxo-
nomy-eligible, non-eligible and taxonomy-aligned
economic activities in relation to the following key


-

forms using the mandatory templates.


on the same data and accounting principles as the



statements).

Group are prepared in accordance with the Inter
-




ensured that no double accounting has occurred.

-

Delegated Act.

The TVO Group examined its business operations
associated with the Olkiluoto nuclear power plant
units, OL1, OL2, and OL3, for taxonomy eligibility.
The relevant and taxonomy-eligible economic activi
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
»
the electricity production in OL1, OL2, and OL3
»

including investments
»

including investments.

correspond to the economic activities in the consoli
-
dated Climate Delegated Act (Commission Delegated

done by comparing the operations and activities to
the descriptions of the economic activities listed in
the Annex I and Annex II in the Climate Delegated
Act and to the related NACE codes. All of the TVO
Group’s nuclear-related operations fall under the
climate change mitigation objective.
The TVO Group’s taxonomy-eligible activities are the

OL3 and the electricity production and plant modi
-

OL3 fall under taxonomy activity 4.27: Construction
and safe operation of new nuclear power plants, for
the generation of electricity or heat, including for
hydrogen production, using best-available techno-
logies, while operations at OL1 and OL2 fall under
taxonomy activity 4.28: Electricity generation from
nuclear energy in existing installations. All activities

-
tion Article 10 (2).

The TVO Group assessed how the activities at OL1,
OL2, and OL3 comply with the relevant technical
screening criteria for contributing substantially
to the climate change mitigation objective and
avoiding harm to the other environmental objec
-
tives. The screening criteria for nuclear and gas
activities include a considerable amount of legal
compliance both at the operational and national
level, and operational compliance with certain
guidelines and standards. Operational compliance
was determined by checking that all relevant docu
-
mentation was available and included the required

in dialogue with the Ministry of Economic Affairs
and Employment.


TVO’s activities on water quality and temperature
are monitored and are well below allowed thresh
-
olds. TVO also monitors other aspects of environ-

of raw materials, emissions to air, water and soil, and
waste management. Details on how TVO manages
environmental impacts can be found in the Envi
-


physical risks to activities at OL1, OL2, and OL3

-

management is described further in TVOs Annual

An important aspect of compliance with the
screening criteria is radioactive waste management
and disposal, including availability of approved
nuclear waste facilities that can manage low-level
waste already now and high-level radioactive waste
latest by 2050. Final disposal of TVO’s spent nuclear

-
active waste management and disposal can be found
in the chapter: Nuclear waste management.
For nuclear energy activities, there is a requirement
that the lifecycle greenhouse gas (GHG) emissions
from the energy production facilities are below 100
gCO
2

emissions from operations at all three plant units fall
well below this threshold. In a transitional phase,
TVO used existing lifecycle assessments (LCA) on
nuclear power plants for estimating its lifecycle GHG
emissions level. The lifecycle GHG emissions at
OL1 and OL2 were estimated to be 4–5 gCO
2

based on an existing LCA analysis of the sister units
operated by Vattenfall (Forsmark 1 and 2 plant units
where emissions are 4.1 gCO
2

GHG emissions at OL3 was estimated to be 4–4.5
gCO
2

First, a lifecycle GHG emissions analysis carried out

of the LCA is 4 gCO
2

study by the European Commission’s Joint Research
Centre that estimated lifecycle GHG emissions for a

the centrifuge enrichment process, to be at 4.25
gCO
2


stated that the lifecycle GHG emissions from nuclear
electricity generation are comfortably within the 100
gCO
2

TVO will verify the alignment by assessing its own
lifecycle GHG emissions level during 2023, and will
use the result in the next EU Taxonomy disclosures

REPORT OF THE BOARD OF DIRECTORS AND FINANCIAL STATEMENTS 2022
16
REPORT OF THE BOARD OF DIRECTORS KEY FIGURES GROUP FINANCIAL STATEMENTS PARENT COMPANY FINANCIAL STATEMENTS FINANCIAL INFORMATION
Based on these assumptions, 98.7 percent of the TVO
Group’s consolidated turnover is taxonomy-aligned
and 100 percent of the taxonomy-relevant CapEx and
OpEx is taxonomy-aligned. The operations at OL1
and OL2 constitute 96.8 percent of the aligned turn
-
over, 23.4 percent of aligned CapEx, and all aligned
OpEx. Operations at OL3 constitute 1.9 percent of

ongoing operational development of OL3.


The taxonomy-aligned turnover consists of the sales
of electricity to shareholders. Non-taxonomy-aligned



perty, plant and equipment, intangible assets, and
right-of-use assets. More detailed information on
capital expenditure can be found in Note 13: Property,
plant and equipment and Note 14: Intangible assets.

which are necessary to ensure the continued and
effective functioning of property, plant and equipment.
These expenses include costs related to research and
development, repairs and maintenance, and nuclear
waste management, as well as all other costs which
are related to day-to-day servicing and maintenance
of property, plant and equipment and which are
necessary to ensure continued and effective activities
by the Company or outsourced to a third party.

In the table below, are the proportions of aligned and
non-eligible activities of the TVO Groups turnover,


Key performance indicators.







Turnover 358,208 99% 1%
Operating expenditure 122,928 100% 0%
Capital expenditure 311,840 100% 0%
The OpEx numerator includes maintenance costs,

management.
All activities are related to the climate change mitiga
-
tion objective, and there is no eligible but not aligned
activities recorded within the activities 4.27 and
4.28. All applicable CapEx and OpEx for calculations
are taxonomy-aligned, for turnover the non-eligible
proportion is 1 percent.

TVO is committed to respecting internationally
recognised human rights and principles and rights
at work, in particular the International Bill of Human

-
ness and Human Rights, in addition to the OECD
Guidelines for Multinational Enterprises and the

ensures its compliance with the minimum safeguards
as required in Article 18 of the Taxonomy Regulation
through the Group-level policies and compliance with
national labour legislation.

Taxonomy-aligned economic activities for the turnover KPI (denominator)






    
1. Amount and proportion of taxonomy-aligned economic



0 0% 0 0% 0 0%
2. Amount and proportion of taxonomy-aligned economic



6,658,979 2% 6,658,979 2% 0 0%
3. Amount and proportion of taxonomy-aligned economic



346,790,909 97% 346,790,909 97% 0 0%
4. Amount and proportion of taxonomy-aligned economic



0 0% 0 0% 0 0%
5. Amount and proportion of taxonomy-aligned economic



0 0% 0 0% 0 0%
6. Amount and proportion of taxonomy-aligned economic



0 0% 0 0% 0 0%
7. Amount and proportion of other taxonomy-aligned
economic activities not referred to in rows 1 to 6 above

0 0% 0 0% 0 0%
8.

358,208,243 99% 358,208,243 99% 0 0%
REPORT OF THE BOARD OF DIRECTORS AND FINANCIAL STATEMENTS 2022
17
REPORT OF THE BOARD OF DIRECTORS KEY FIGURES GROUP FINANCIAL STATEMENTS PARENT COMPANY FINANCIAL STATEMENTS FINANCIAL INFORMATION
Taxonomy-aligned economic activities for the CapEx KPI (denominator)






    
1. Amount and proportion of taxonomy-aligned economic



0 0% 0 0% 0 0%
2. Amount and proportion of taxonomy-aligned economic



244,342,727 78% 244,342,727 78% 0 0%
3. Amount and proportion of taxonomy-aligned economic



67,497,510 22% 67,497,510 22% 0 0%
4. Amount and proportion of taxonomy-aligned economic



0 0% 0 0% 0 0%
5. Amount and proportion of taxonomy-aligned economic



0 0% 0 0% 0 0%
6. Amount and proportion of taxonomy-aligned economic



0 0% 0 0% 0 0%
7. Amount and proportion of other taxonomy-aligned
economic activities not referred to in rows 1 to 6 above

0 0% 0 0% 0 0%
8.

311,840,237 100% 311,840,237 100% 0 0%
REPORT OF THE BOARD OF DIRECTORS AND FINANCIAL STATEMENTS 2022
18
REPORT OF THE BOARD OF DIRECTORS KEY FIGURES GROUP FINANCIAL STATEMENTS PARENT COMPANY FINANCIAL STATEMENTS FINANCIAL INFORMATION
Taxonomy-aligned economic activities for the OpEx KPI (denominator)






    
1. Amount and proportion of taxonomy-aligned economic



0 0% 0 0% 0 0%
2. Amount and proportion of taxonomy-aligned economic



0 0% 0 0% 0 0%
3. Amount and proportion of taxonomy-aligned economic



122,927,947 100% 122,927,947 100% 0 0%
4. Amount and proportion of taxonomy-aligned economic



0 0% 0 0% 0 0%
5. Amount and proportion of taxonomy-aligned economic



0 0% 0 0% 0 0%
6. Amount and proportion of taxonomy-aligned economic



0 0% 0 0% 0 0%
7. Amount and proportion of other taxonomy-aligned
economic activities not referred to in rows 1 to 6 above

0 0% 0 0% 0 0%
8.

122,927,947 100% 122,927,947 100% 0 0%
REPORT OF THE BOARD OF DIRECTORS AND FINANCIAL STATEMENTS 2022
19
REPORT OF THE BOARD OF DIRECTORS KEY FIGURES GROUP FINANCIAL STATEMENTS PARENT COMPANY FINANCIAL STATEMENTS FINANCIAL INFORMATION
Taxonomy-aligned economic activities for the turnover KPI (numerator)






    
1. Amount and proportion of taxonomy-aligned economic



0 0% 0 0% 0 0%
2. Amount and proportion of taxonomy-aligned economic



6,658,979 2% 6,658,979 2% 0 0%
3. Amount and proportion of taxonomy-aligned economic



346,790,909 98% 346,790,909 98% 0 0%
4. Amount and proportion of taxonomy-aligned economic



0 0% 0 0% 0 0%
5. Amount and proportion of taxonomy-aligned economic



0 0% 0 0% 0 0%
6. Amount and proportion of taxonomy-aligned economic



0 0% 0 0% 0 0%
7. Amount and proportion of other taxonomy-aligned
economic activities not referred to in rows 1 to 6 above

0 0% 0 0% 0 0%
8. Total amount and proportion of taxonomy-aligned
economic activities in the numerator of the applicable

353,449,887 100% 353,449,887 100% 0 0%
REPORT OF THE BOARD OF DIRECTORS AND FINANCIAL STATEMENTS 2022
20
REPORT OF THE BOARD OF DIRECTORS KEY FIGURES GROUP FINANCIAL STATEMENTS PARENT COMPANY FINANCIAL STATEMENTS FINANCIAL INFORMATION
Taxonomy-aligned economic activities for the CapEx KPI (numerator)






    
1. Amount and proportion of taxonomy-aligned economic



0 0% 0 0% 0 0%
2. Amount and proportion of taxonomy-aligned economic



244,342,727 78% 244,342,727 78% 0 0%
3. Amount and proportion of taxonomy-aligned economic



67,497,510 22% 67,497,510 22% 0 0%
4. Amount and proportion of taxonomy-aligned economic



0 0% 0 0% 0 0%
5. Amount and proportion of taxonomy-aligned economic



0 0% 0 0% 0 0%
6. Amount and proportion of taxonomy-aligned economic



0 0% 0 0% 0 0%
7. Amount and proportion of other taxonomy-aligned
economic activities not referred to in rows 1 to 6 above

0 0% 0 0% 0 0%
8. Total amount and proportion of taxonomy-aligned
economic activities in the numerator of the applicable

311,840,237 100% 311,840,237 0% 0 0%
REPORT OF THE BOARD OF DIRECTORS AND FINANCIAL STATEMENTS 2022
21
REPORT OF THE BOARD OF DIRECTORS KEY FIGURES GROUP FINANCIAL STATEMENTS PARENT COMPANY FINANCIAL STATEMENTS FINANCIAL INFORMATION
Taxonomy-aligned economic activities for the OpEx KPI (numerator)






    
1. Amount and proportion of taxonomy-aligned economic



0 0% 0 0% 0 0%
2. Amount and proportion of taxonomy-aligned economic



0 0% 0 0% 0 0%
3. Amount and proportion of taxonomy-aligned economic



122,927,947 100% 122,927,947 100% 0 0%
4. Amount and proportion of taxonomy-aligned economic



0 0% 0 0% 0 0%
5. Amount and proportion of taxonomy-aligned economic



0 0% 0 0% 0 0%
6. Amount and proportion of taxonomy-aligned economic



0 0% 0 0% 0 0%
7. Amount and proportion of other taxonomy-aligned
economic activities not referred to in rows 1 to 6 above

0 0% 0 0% 0 0%
8. Total amount and proportion of taxonomy-aligned
economic activities in the numerator of the applicable

122,927,947 100% 122,927,947 100% 0 0%
REPORT OF THE BOARD OF DIRECTORS AND FINANCIAL STATEMENTS 2022
22
REPORT OF THE BOARD OF DIRECTORS KEY FIGURES GROUP FINANCIAL STATEMENTS PARENT COMPANY FINANCIAL STATEMENTS FINANCIAL INFORMATION
Taxonomy non-eligible economic activities
   
1. Amount and proportion of economic activity referred to in row 1 of Template 1 that


0 0%
2. Amount and proportion of economic activity referred to in row 2 of Template 1 that


0 0%
3. Amount and proportion of economic activity referred to in row 3 of Template 1 that


0 0%
4. Amount and proportion of economic activity referred to in row 4 of Template 1 that


0 0%
5. Amount and proportion of economic activity referred to in row 5 of Template 1 that


0 0%
6. Amount and proportion of economic activity referred to in row 6 of Template 1 that


0 0%
7. Amount and proportion of other taxonomy-non-eligible economic activities not

4,758,356 1%
8. Total amount and proportion of taxonomy-non-eligible economic activities in the

4,758,356 1%
Taxonomy-eligible but not taxonomy-aligned economic activities







    
1. Amount and proportion of taxonomy-eligible but not
taxonomy-aligned economic activity referred to in


0 0% 0 0% 0 0%
2. Amount and proportion of taxonomy-eligible but not
taxonomy-aligned economic activity referred to in


0 0% 0 0% 0 0%
3. Amount and proportion of taxonomy-eligible but not
taxonomy-aligned economic activity referred to in


0 0% 0 0% 0 0%
4. Amount and proportion of taxonomy-eligible but not
taxonomy-aligned economic activity referred to in


0 0% 0 0% 0 0%
5. Amount and proportion of taxonomy-eligible but not
taxonomy-aligned economic activity referred to in


0 0% 0 0% 0 0%
6. Amount and proportion of taxonomy-eligible but not
taxonomy-aligned economic activity referred to in


0 0% 0 0% 0 0%
7. Amount and proportion of other taxonomy-eligible but not
taxonomy-aligned economic activities not referred to in

0 0% 0 0% 0 0%
8. Total amount and proportion of taxonomy eligible but not
taxonomy-aligned economic activities in the denominator of

0 0% 0 0% 0 0%
REPORT OF THE BOARD OF DIRECTORS AND FINANCIAL STATEMENTS 2022
23
REPORT OF THE BOARD OF DIRECTORS KEY FIGURES GROUP FINANCIAL STATEMENTS PARENT COMPANY FINANCIAL STATEMENTS FINANCIAL INFORMATION
Subsidiaries and joint ventures


customers with services and expertise related to
high-level nuclear safety, cost-effective operations
and nuclear waste management, and building new
nuclear power plants. The specialised expertise and

disposal.


disposal of spent nuclear fuel from its shareholders’



provides nuclear waste management consultancy
services, as well as related planning and research
and development activities.
Major events after the end of the year
After tests at full reactor capacity, the OL3 plant
unit’s production was interrupted according to plan
in January 2023 in order to replace the impellers of
the feedwater pumps. Thereafter, before the start
of regular electricity production, an approximately
month-long production phase will still follow in the
test production, where OL3 will produce electricity at

starts in March 2023.
Prospects for the future
Electricity production is expected to increase as OL3
starts regular electricity production. The prerequisites
for nuclear power production in Olkiluoto are good.
Nuclear fuel availability is guaranteed by long-term
agreements.

OL3’s regular electricity production in March 2023,
as well as the provisional takeover of the plant unit in

-


signed in June 2021, which continue until the end of
the guarantee periods.

project in 2023, which encompasses the entirety of

Proposals to the Annual General Meeting
Teollisuuden Voima Oyj’s distributable equity as of 31
December 2022 amounted to EUR 20,938,560.00,

EUR 2,208,600.00. The Board of Directors proposes


account of previous accounting periods and that no
dividend shall be paid.
REPORT OF THE BOARD OF DIRECTORS AND FINANCIAL STATEMENTS 2022
24
REPORT OF THE BOARD OF DIRECTORS KEY FIGURES GROUP FINANCIAL STATEMENTS PARENT COMPANY FINANCIAL STATEMENTS FINANCIAL INFORMATION

     
Turnover 358 299 275 254 350
 -48 -20 0 87 -18
Research expenses 10 12 12 15 16
Investments 312 578 56 369 181
Equity 2,218 2,063 2,043 1,819 1,745

2)
4)
929 929 929 679 679
Non-current and current interest-bearing liabilities (excluding loan from VYR)
1)
4,831 4,337 4,281 4,370 4,141
Loan from VYR 651 711 716 591 666
 1,294 1,368 1,030 1,041 952
Balance sheet total 9,171 8,662 8,181 7,942 7,662

3)
30.7 31.3 31.7 28.8 28.9
Average number of personnel 1,031 1,004 984 943 872
1)

2)

3)


Management Fund
4)


     
 -48 -20 0 87 -18
The impact of the nuclear waste management obligation
1)
 36 17 6 -80 22
 0 0 0 -1 -1
The impact of joint ventures 2 -1 3 -1 -1
 -10 -4 9 5 2
 -10 -4 9 5 2
1)

     
 1,436 1,451 1,479 1,514 1,480
TVO's funding target obligation to
 1,458 1,436 1,451 1,471 1,506
The carrying value of TVO's share in
 1,000 1,010 1,030 1,041 952
Assets and provisions related to the nuclear waste management obligation.
REPORT OF THE BOARD OF DIRECTORS AND FINANCIAL STATEMENTS 2022
25
REPORT OF THE BOARD OF DIRECTORS KEY FIGURES GROUP FINANCIAL STATEMENTS PARENT COMPANY FINANCIAL STATEMENTS FINANCIAL INFORMATION



     
Turnover 353 294 271 251 346
 -10 -4 8 5 1
Fuel costs 70 61 64 65 72
Nuclear waste management costs 100 41 28 -5 58
 37 38 34 39 53
Investments 339 220 52 278 177
Equity 864 861 861 857 857
Appropriations 181 193 197 193 187
Non-current and current interest-bearing liabilities (excluding loan from
VYR and loans from equity holders of the company)
1)
2)
4,798 4,277 4,180 4,282 4,070
Loans from equity holders of the company
2)
929 929 929 679 679
Loan from VYR 651 711 716 591 666
Balance sheet total 7,602 7,156 6,995 6,724 6,619

3)
28.4 30.8 31.7 28.2 29.0
Average number of personnel 1,029 1,002 983 942 871
1)

2)

3)


     
Olkiluoto 1 6,918 7,393 7,299 7,531 6,742
Olkiluoto 2 7,522 7,021 7,264 7,198 7,321
Olkiluoto 3 1,876 0 0 0 0
Total Olkiluoto 16 316 14,414 14,563 14,729 14,063
 0 0 82 182 660
Total     
     
Olkiluoto 1 89.1 95.1 93.7 96.9 87.8
Olkiluoto 2 96.8 90.4 93.3 92.7 94.3
Olkiluoto 3 16.9 - - - -
Total capacity factor     
     
19.9 16.8 18.1 17.3 16.9
REPORT OF THE BOARD OF DIRECTORS AND FINANCIAL STATEMENTS 2022
26
REPORT OF THE BOARD OF DIRECTORS KEY FIGURES GROUP FINANCIAL STATEMENTS PARENT COMPANY FINANCIAL STATEMENTS FINANCIAL INFORMATION
Consolidated income statement
EUR 1,000
Note
1 Jan-31 Dec 2022
1 Jan-31 Dec 2021
Turnover
3,4
358,208
298,713
Work performed for own purpose
21,310
25,036
Other income
6
13,068
13,446
Materials and services
7
-137,884
-90,840
Personnel expenses
8
-80,316
-82,142
Depreciation and impairment charges
4,9
-46,992
-43,996
Other expenses
10
-100,625
-103,944

26,769
16,273
Finance income
11
6,295
4,681
Finance expenses
11
-81,480
-41,887

-75,185
-37,206

590
1,280

-47,826
-19,653
Income taxes
12
-52

-47,878
-19,653

Equity holders of the company
-47,878
-19,653
Consolidated statement of comprehensive income
EUR 1,000
Note
1 Jan-31 Dec 2022
1 Jan-31 Dec 2021

-47,878
-19,653
Other comprehensive items


11
211,736
44,363

211,736
44,363

163,858
24,710

Equity holders of the company
163,858
24,710
TVO Group
REPORT OF THE BOARD OF DIRECTORS AND FINANCIAL STATEMENTS 2022
27
REPORT OF THE BOARD OF DIRECTORS KEY FIGURES GROUP FINANCIAL STATEMENTS PARENT COMPANY FINANCIAL STATEMENTS FINANCIAL INFORMATION
Consolidated balance sheet
EUR 1,000
Note
31 Dec 2022
31 Dec 2021


Property, plant and equipment
13
6,363,783
6,177,755
Intangible assets
14
2,476
2,543
Loans and other receivables
17
710,962
714,027

15
3,897
5,516
Investments in shares
18
1,935
1,935

20
225,183
33,966
Share in the Finnish State Nuclear Waste Management Fund
24
999,662
1,010,071

8,307,898
7,945,813

Inventories
19
272,378
274,489
Trade and other receivables
3,17
233,078
261,834

20
4,463
7,809
Cash and cash equivalents
353,203
172,318

863,122
716,450

9,171,020
8,662,263


Share capital
21
600,365
600,365
Share premium reserve and statutory reserve
21
242,383
242,383
Fair value and other reserves
21
228,727
16,991
Subordinated shareholder loans (hybrid equity)
21
929,300
929,300
Retained earnings
21
216,742
274,022

2,217,517
2,063,061
EUR 1,000
Note
31 Dec 2022
31 Dec 2021


Provision related to nuclear waste management
24
1,294,345
1,368,291
Loan from the Finnish State Nuclear Waste Management Fund
22
651,339
711,266
Bonds
22
3,254,801
2,811,264

22
1,276,463
1,065,928

20,22
40,040
10,740

6,516,988
5,967,489


22
258,669
445,619

20,22
544
3,268
Advance payments received
3,23
23,064
21,218
Trade payables
23
16,821
56,672
Other current liabilities
23
137,417
104,936

436,515
631,713

6,953,503
6,599,202

9,171,020
8,662,263
REPORT OF THE BOARD OF DIRECTORS AND FINANCIAL STATEMENTS 2022
28
REPORT OF THE BOARD OF DIRECTORS KEY FIGURES GROUP FINANCIAL STATEMENTS PARENT COMPANY FINANCIAL STATEMENTS FINANCIAL INFORMATION
Consolidated statement of changes in total equity
Share premium reserveFair value andSubordinated shareholder 
EUR 1,000
Note
Share capital
and statutory reserveother reserves
loans (hybrid equity)
Retained earnings
holders of the company
Total equity
1 Jan 2022
600,365
242,383
16,991
929,300
274,022
2,063,061
2,063,061

0
0
0
-47,878
-47,878
-47,878


211,736
0
0
211,736
211,736
Interest paid of subordinated shareholder loans (hybrid equity)
0
0
-9,402
-9,402
-9,402
312022
21
600,365
242,383
228,727
929,300
216,742
2,217,517
2,217,517
Share premium reserveFair value andSubordinated shareholder 
EUR 1,000
Note
Share capital
and statutory reserveother reserves
loans (hybrid equity)
Retained earnings
holders of the company
Total equity
1 Jan 2021
600,365
242,383
-27,372
929,300
298,272
2,042,948
2,042,948

0
0
0
-19,653
-19,653
-19,653


44,363
0
0
44,363
44,363
Interest paid of subordinated shareholder loans (hybrid equity)
0
0
-4,597
-4,597
-4,597
312021
21
600,365
242,383
16,991
929,300
274,022
2,063,061
2,063,061
REPORT OF THE BOARD OF DIRECTORS AND FINANCIAL STATEMENTS 2022
29
REPORT OF THE BOARD OF DIRECTORS KEY FIGURES GROUP FINANCIAL STATEMENTS PARENT COMPANY FINANCIAL STATEMENTS FINANCIAL INFORMATION

EUR 1,000
Note
2022
2021


-47,878
-19,653

Taxes
52
Finance income and expenses
75,185
37,206
Depreciation and impairment charges
46,992
43,996

-590
-1,280

-46,163
-25,629

Increase (-) or decrease (+) in non-interest-bearing receivables
28,281
-17,739
Increase (-) or decrease (+) in inventories
2,137
-376
Increase (+) or decrease (-) in short-term non-interest-bearing liabilities
31,875
13,474

-4,253
-4,296
Dividend received
2,209
Interest received
6,277
3,977
Taxes paid
-52

94,072
29,680

Acquisition of property, plant and equipment
-425,468
-315,370

206,875
Acquisition of intangible assets
-372
-263
Acquisition of shares
-1
Loan receivables granted
-15,831
-105
Repayments of loans granted
75,837
5,392

-365,834
-103,472
1)
EUR 1,000
Note
2022
2021

Withdrawals of long-term loans
1,050,000
800,000
Repayment of long-term loans
-517,415
-571,683
Principal elements of lease payments
-2,409
-2,117
Interest paid of subordinated shareholder loans (hybrid equity)
-6,079
-4,673

62,740
61,630

-134,190
-198,410

452,647
84,747

180,885
10,955
Cash and cash equivalents 1 Jan
172,318
161,363
31
18
353,203
172,318
1)

REPORT OF THE BOARD OF DIRECTORS AND FINANCIAL STATEMENTS 2022
30
REPORT OF THE BOARD OF DIRECTORS KEY FIGURES GROUP FINANCIAL STATEMENTS PARENT COMPANY FINANCIAL STATEMENTS FINANCIAL INFORMATION
Notes to the consolidated financial statements
1 General information on the Group
Teollisuuden Voima Oyj together with its subsidiary
forms the TVO Group. The ultimate parent of the
Group is Teollisuuden Voima Oyj, domiciled in Helsinki.
TVO owns and operates three nuclear power plant
units (OL1, OL2 and OL3) in Olkiluoto, in the munic
-
ipality of Eurajoki. OL3 is currently under the test
production phase. In addition, TVO has a share in a
gas turbine plant.
Copies of the consolidated financial statements are
available at www.tvo.fi.
These consolidated financial statements were autho-
rised for issue by the Board of Directors of TVO in
its meeting on 15 February 2023. 
Limited Liability Companies Act, the Shareholders
meeting may modify or reject the financial statements.
The Financial Statements are also published in
accordance with the European Single Electronic
Format (ESEF) reporting requirement. The ESEF
report is available at www.tvo.fi.
TVO’S COST-PRICE PRINCIPLE
TVO is a public limited liability company owned by
Finnish industrial and energy companies. Under its
Articles of Association, TVO supplies electricity to its
shareholders at cost (so-called Mankala principle),
which means that it delivers the electricity it has
produced or procured to its shareholders in propor
-
tion to their shareholdings in each series. Each of the
shareholders of each series bears their share of the
variable and fixed annual costs as specified in detail
in the Articles of Association.
In accordance with TVO’s Articles of Association,
each shareholder of each series is responsible for the
following variable annual costs of the Company allo
-
cated to the series in proportion to the electricity it has
consumed generated or transferred by the Company:
1. Acquisition, transport, transportation insurance, storage
and handling costs of fuel;
2. Taxes depending on the power production, and
3. Other costs incurred to the company directly depending
on the power volume used by the respective shareholder.
In accordance with TVO’s Articles of Association,
each shareholder of each series, irrespective of
THE EFFECT OF THE OPERATING ENVIRONMENT
ON THE FINANCIAL STATEMENTS
The TVO Group continued preparations for possible
COVID-19 infections during the year, and the spread
of the virus was prevented through several mea-
sures on the Olkiluoto island. The effectiveness
of the measures was deemed successful, since
COVID-19 transmission chains were avoided in
Olkiluoto. The restrictions were lifted during the
summer, and national and regional instructions
are followed in the COVID-19 guidelines. The
COVID-19 pandemic has not materially affected
accounting policies nor reporting numbers.
During the accounting period, the Ukrainian situa
-
tion has not had an immediate or direct effect on the
Group’s operations or the production of electricity.
However, cost increases are being prepared for in
EFFECTS OF STARTING THE OL3 PLANT UNIT’S
ELECTRICITY PRODUCTION ON THE FINANCIAL
STATEMENTS
On 12 March 2022, OL3 was connected to the
national grid and electricity production started.
According to information received from the Plant
Supplier in December 2022, OL3’s regular electricity
production is to start in March 2023. TVO’s sales
proceeds from the delivery of OL3’s test production
electricity and variable costs are recorded in the
income statement. Electricity from the test produc
-
tion phase has been delivered to shareholders in
proportion to their shareholdings and invoiced
monthly based on the amount of electricity delivered
to shareholders. In accordance with TVO’s Articles
of Association, the invoiced variable costs consists of
fuel costs and electricity transmission costs.
the TVO Group. Market interest rates have strongly
increased due to rising inflation and the actions of
central banks.
whether or not it has used its share of electricity, is
responsible for the following fixed annual costs of the
Company in proportion to the number of shares in a
particular series it holds:
4. Normal operating, maintenance and administrative
costs;
5. Other taxes than those depending on the power
production;
6. Insurance costs;
7. Installments and interest payments on the loans of
the Company falling due annually in accordance with
the loan agreements of the Company as well as other
expenses resulting from the financing of the Company
or the arranging thereof;
8. Depreciations;
9. Costs set out in the Nuclear Energy Act incurred by the
Company’s nuclear waste management (concerning the
nuclear power plants), and
10. Other costs independent of power production related
to the Company’s normal business and included in the
budget or approved by the Board of Directors.
In accordance with TVO’s Articles of Association,
each shareholder’s share of the liability for the
annual costs will always be limited to the amount
corresponding to the proportion of its shareholding
to all shares belonging to the same series, and
another shareholder’s failure will not increase the
shareholder’s liability based on shareholding. Only
REPORT OF THE BOARD OF DIRECTORS AND FINANCIAL STATEMENTS 2022
31
REPORT OF THE BOARD OF DIRECTORS KEY FIGURES GROUP FINANCIAL STATEMENTS PARENT COMPANY FINANCIAL STATEMENTS FINANCIAL INFORMATION
COMPANIES INCLUDED IN THE CONSOLIDATED
FINANCIAL STATEMENTS
Subsidiaries
The consolidated financial statements include
Teollisuuden Voima Oyj (TVO) and its subsidiary TVO
Nuclear Services Oy. Subsidiaries are companies
in which the Group has control at the end of the
financial period. Control exists if the Group holds
more than half of the voting rights or otherwise has
control. Subsidiaries acquired are consolidated from
the date on which control is transferred to the Group,
and subsidiaries sold are no longer consolidated from
the date that control ceases.
The purchase method of accounting is used to
consolidate subsidiaries into the Group. The purchase
price is determined as the aggregate of the acquisi
-
tion date fair values of the assets given as considera-
tion and liabilities incurred or assumed. Costs directly
attributable to the acquisition are recognised in profit
or loss.
In the consolidation, intercompany share ownership,
intercompany transactions, receivables, liabilities,
unrealised gains and internal distributions of profits
are eliminated. Unrealised losses are not eliminated,
if the losses are due to impairment of the asset being
transferred. To ensure consistency, subsidiaries
accounting policies have, in all material respects,
been changed to conform to the accounting policies
adopted by the Group.
Joint ventures
The Group applies IFRS 11 to all joint arrangements.
Under IFRS 11, investments in joint arrangements
are classified as either joint operations or joint
ventures, depending on the contractual rights and
obligations of each investor.
TVO’s joint venture is Posiva Oy, the main activities
of which (A series) consist of the final disposal of
nuclear fuel of nuclear power plants. Both ventures
are liable for its main activities in proportion to their
own usage. Posiva Solutions Oy is a wholly-owned
subsidiary of Posiva Oy (B series). Posiva Solutions
Oy focuses on the sales of the know-how Posiva has
accumulated from its design, research and develop
-
the Company will have the sole right to call upon
the responsibility of the shareholders defined in the
Articles of Association. The shareholders shall not be
liable for costs other than the costs of the Company
mentioned above, unless otherwise agreed.
A prerequisite to the shareholders right to receive
electricity is that it has paid its share of costs
on time. If a shareholder neglects to observe its
payment obligation, the Company will have the
right to immediately cut off the distribution of
electricity to the shareholder and to sell the share
-
holders portion of electricity to a party submitting
the best offer, primarily to another shareholder of
the Company.
The cost-price principle is described in detail in the
Articles of Association.
2 Accounting policies
BASIS OF PREPARATION
These consolidated financial statements of the
TVO Group have been prepared in accordance with
International Financial Reporting Standards (IFRS).
These financial statements have been prepared in
accordance with the IAS and IFRS standards and SIC
and IFRIC interpretations effective on 31 December
2022. In the Finnish Accounting Act and regulations
issued by virtue of it, “IFRS” refers to the standards
and interpretations which have been endorsed by the
EU in accordance with the procedure defined in the
EU Regulation (EY) No. 1606/2002.
The consolidated financial statements have been
prepared under the historical cost convention, except
for investments in shares and derivative financial
instruments, which are recognised at fair value.
The consolidated financial statements are presented
in euros, which is the functional and presentation
currency of the Group’s parent company.
The consolidated financial statements have been
prepared according to the same accounting
policies as in 2021. The Group has adopted the
following amendments to existing standards as of
1 January 2022:
»
IAS 16 (amendment) Property, Plant and Equipment
The standard amendment prohibits a company from
deducting from the cost of property, plant and equipment
amounts received from selling items produced while the
company is preparing the asset for its intended use. With
the amendment, profits will not be deducted from testing
costs which form a part of the asset’s acquisition cost
as before. Instead, a company will recognise such sales
proceeds in the income statement.
TVO’s sales proceeds from the delivery of OL3’s test
production electricity and variable costs are recorded in
the income statement. Electricity from the test production
phase has been delivered to shareholders in proportion
to their shareholdings and invoiced monthly based on
the amount of electricity delivered to shareholders. In
accordance with TVO’s Articles of Association, the
invoiced variable costs consist of fuel costs and electricity
transmission costs.
»
IFRS 3 (amendment) Business Combinations: Reference
to the conceptual framework
»
IAS 37 (amendment) Provisions, Contingent Liabilities
and Contingent Assets: Onerous contracts, cost of
fulfilling a contract
»
Annual Improvements 2018-2020: IFRS 9 Financial
Instruments, IFRS 16 Leases and IAS 41 Agriculture
The following amendments to existing standards
issued already will be adopted by the Group in 2023:
»
IFRS 17 Insurance Contracts: Replace IFRS 4 Insurance
Contracts and requires a current measurement model
»
IAS 1 (amendment) Presentation of Financial Statements:
Require to disclose material accounting policy information
»
IAS 8 (amendment) Accounting Policies, Changes in
Accounting Estimates and Errors: Disclosure of Accounting
policies and Definition of Accounting Estimates
»
IAS 12 (amendment) Income Taxes: Deferred Tax related
to Assets and Liabilities arising from a Single Transaction
The following new standards and amendments to
existing standards issued already will be adopted by
the Group in 2024 or later:
»
IAS 1 (amendment) Presentation of Financial Statements
1)
:
Classification of Liabilities as Current or Non-current
»
IFRS 16 (amendment) Leases
1)
: Lease Liability in a Sale
and Leaseback
Based on the initial assessment, the Group estimates
that these changes have no material impact on the
consolidated financial statements, unless separately
mentioned above.
1)
The standard, interpretation or amendment to published standard
or interpretation is still subject to endorsement by the European
Union. Effective date will be 1 January 2024.
REPORT OF THE BOARD OF DIRECTORS AND FINANCIAL STATEMENTS 2022
32
REPORT OF THE BOARD OF DIRECTORS KEY FIGURES GROUP FINANCIAL STATEMENTS PARENT COMPANY FINANCIAL STATEMENTS FINANCIAL INFORMATION
ment activities in the final disposal of spent nuclear
fuel, as well as on associated consulting services. The
Posiva Group is accounted for by the equity method
of accounting.
Under the equity method of accounting, interests
in joint ventures are initially recognised at cost and
adjusted thereafter to recognise the Group’s share
of the post-acquisition profits or losses and move
-
ments in other comprehensive income. When the
Group’s share of losses in a joint venture equals or
exceeds its interests in the joint ventures, the Group
does not recognise further losses, unless it has
incurred obligations or made payments on behalf of
the joint ventures.
Unrealised gains on transactions between the Group
and its joint venture are eliminated to the extent of
the Group’s interest in the joint ventures. Unrealised
losses are also eliminated unless the transaction
provides evidence of an impairment of the asset
transferred. Accounting policies of the joint ventures
have been changed where necessary to ensure
consistency with the policies adopted by the Group.
REVENUE RECOGNITION PRINCIPLES
TVO operates on a cost-price principle. Revenue
is recognised based on the consideration received
when electricity is delivered or services are rendered.
Revenue is presented net of indirect sales taxes.
Revenue is recognised as follows:
Sales of electricity and other revenue
Revenue on sales of electricity is divided into variable
and fixed charge. Revenue on sales of electricity
concerning variable charge is recognised based on
delivery. The recognised income for shareholders
is based on the quantities delivered. The variable
charge is invoiced and recognised in turnover
monthly. These variable costs are paid retrospectively
on the 24th of the next month. The fixed costs, or
liabilities based on customer contracts, are invoiced
one month in advance and recognised as advance
payments received. The fixed charge is entered
as income in the right month. According to TVOs
Articles of Association, the fixed costs must be paid
monthly in advance, and no later than the 24th day of
the preceding month.
The revenue from services is recognised on an
accrual basis in the accounting period when the
services are rendered to the customer and when the
control of the service transfers to a customer.
SEGMENT REPORTING
The Board of Directors is the chief operating decision
maker in TVO, and is in charge of the allocation of
resources to the operating segments and for the
assessment of their results. The Board also decides
on the corporate strategy, significant investments,
the organisational structure, as well as financing and
insurance policies. The operating plan and the budget
are also approved by the Board of Directors, which
also monitors their implementation and delivers the
elements required to secure the operation of systems
and procedures that are critical to nuclear safety and
safety culture.
TVO owns and operates three nuclear power plant
units (OL1, OL2, and OL3). The OL3 nuclear power
plant unit is at the test production phase. TVO’s
shares are divided into A and B series. Shareholders
with series A shares are entitled to the electricity
produced at the OL1 and OL2 nuclear power plant
units. Shareholders with series B shares are entitled
to the electricity produced at the OL3 nuclear power
plant unit. Pursuant to the Articles of Association,
the purpose of all of the TVO Group’s business
operations is to construct and acquire power plants
and power transmission equipment, and to generate,
transfer and transmit electricity primarily to the
shareholders of the Company on the terms and
conditions set out in the Articles of Association.
Based on the series of shares, TVO identifies two
operating segments; “OL1/OL2 (series A shares)”
and “OL3 (series B shares)” which are reported on to
the Board of Directors on a regular basis. Operating
segments “OL1/OL2 (series A shares)” and “OL3
(series B shares)” are aggregated into one operating
segment “Nuclear power” based on the aggregation
criteria presented in the standard (IFRS 8:12).
The operating segments have similar economic
characteristics as they share the same cost structure
and TVO as a whole operates according to the cost-
price principle (Mankala principle). The shareholders
are charged incurred costs in the price of electricity,
and thus in principle the profit/loss for the period
under review is zero, unless specific circumstances
dictate otherwise. The shareholders pay variable
costs based on the volumes of energy supplied,
and fixed costs in proportion to their ownership,
irrespective of whether or not they have used their
share of the power output. Due to the operating
principle, key figures based on the financial result are
not presented.
Furthermore, the operating segments are similar
in terms of all of the following characteristics: the
nature of the products and services, the nature of the
production processes, the type or class of customer
for the products and services, the methods used
to distribute the products or provide the services,
and the nature of the regulatory environment. Both
operating segments use nuclear power to generate
electricity in Olkiluoto in the Municipality of Eura
-
joki. Through TVO’s direct owners, the electricity
produced by TVO is provided to the Finnish industry
as well as energy companies.
The customers of the operating segments consist of
the shareholders of the Company. The shareholders
of both share series are essentially the same. The
ownership proportions of the shareholders are
essentially the same for both share series and
electricity is sold to the shareholders in proportion
to their ownership of each share series. The price
of electricity is the same to all the shareholders of
the share series. The regulatory environment of the
operating segments is consistent. The premise of
the Nuclear Energy Act (990/1987) is that the use of
nuclear energy shall be in line with the overall good
of the society, as well as safe, and it shall not cause
any harm to people, the environment, or property.
The licensee has several obligations in respect of
the use of nuclear energy; for example, the licensee
is responsible for the safety of the use of nuclear
energy and for the waste generated by the oper
-
ations as well as for all the costs of nuclear waste
management. The operating segments also share the
same financing and personnel. Electricity production
is the one business area of TVO, and from the point
of view of the shareholders, nuclear energy is consid
-
ered as a whole.
Based on the criteria presented above, the oper
-
ating segments are aggregated into one operating
segment and the Group has one reportable segment:
“Nuclear power”. This segment also covers TVO
Nuclear Services Oy (TVONS), a subsidiary of the
Group, which engages in operations related to
nuclear power.
REPORT OF THE BOARD OF DIRECTORS AND FINANCIAL STATEMENTS 2022
33
REPORT OF THE BOARD OF DIRECTORS KEY FIGURES GROUP FINANCIAL STATEMENTS PARENT COMPANY FINANCIAL STATEMENTS FINANCIAL INFORMATION
Revenue from long-term consulting services projects
that is spread over several accounting periods is
recognised based on the proportion of costs incurred
from work performed up to the balance sheet date
and the estimated total expenses of the project. If it
is probable that total contract costs will exceed total
contract revenue, the expected loss is recognised as
an expense immediately.
Other income
Revenue from activities outside the ordinary course
of business is reported as other income. This includes
joint ventures’ revenue from services, rental income
and non-recurring items, such as gains from sales
of property, plant and equipment. Rental income is
recognised on a straight-line basis over the rental
period and gains from sales of property, plant and
equipment when the significant risks and rewards of
ownership, interests and control have been trans
-
ferred to the buyer.
GOVERNMENT GRANTS
Grants are recognised at their fair value, when the
Group meets all the conditions attached to them,
and where there is a reasonable assurance that the
grant will be received. Government grants relating to
costs are deferred on the balance sheet and recog
-
nised in the income statement over the period in
which their relevant costs are recorded. Government
grants relating to the purchase of property, plant
and equipment are deducted from the acquisition
cost of the asset.
RESEARCH AND DEVELOPMENT COSTS
Research and development costs (except R&D
costs related to nuclear waste management) of the
Group are recognised as an expense as incurred and
included in other expenses in the income statement.
Development costs are capitalised if it is assured that
they will generate future income, in which case they
are capitalised as intangible assets and amortised
over the period of the income streams. Currently, the
Group does not have any development costs that
would qualify for capitalisation.
Research costs that relate to nuclear waste
management are discussed in the paragraph Assets
and provisions related to nuclear waste manage
-
ment obligations.
PROPERTY, PLANT AND EQUIPMENT
Property, plant and equipment of the Group are
stated on the consolidated balance sheet at historical
cost less grants received, accumulated depreciation
and impairment charges, and compensation, if any.
Historical cost includes expenditure that is directly
attributable to the acquisition of an item.
In the historical costs of power plant projects and
other significant investments (completion time more
than a year), the financing costs incurred during the
construction period will be included.
The historical costs of nuclear power plants include
furthermore the estimated costs of dismantling and
removing an item and restoring the site on which it
is located (more information is included in paragraph
Assets and provisions related to nuclear waste
management obligations).
Land and water areas are not depreciated.
Other property, plant and equipment are depreciated
using the straight-line method over their estimated
useful lives.
Straight-line depreciation is based on the following
estimated useful lives:
»
OL1 and OL2 nuclear power plant units:
-
Basic investment 61 years
-
Investments made according to
the modernisation programme 16–35 years
-
Automation investments
associated with the modernisation 15 years
-
Additional investments 10 years
»
Buildings and structures 10–40 years
»
TVO’s share in the Olkiluoto
gas turbine power plant 30 years.
The assets’ residual values and useful lives are
reviewed, and adjusted if appropriate to reflect the
changes in expectations of economic benefits.
Costs of renewal of an item or a part of an item of
property, plant and equipment are capitalised if the
part is accounted for as a separate item. Otherwise,
the subsequent expenditure is included in the
carrying amount only when it is probable that future
economic benefits associated with the expenditure
will flow to the Group.
Annual repair and maintenance costs are recog
-
nised in profit or loss when they occur. Investments
connected with the modernisation and maintenance
of the power plant units are capitalised.
The OL3 plant unit is under the test production
phase, and all realised costs that meet recognition
criteria are shown as incomplete plant investment.
See Note 12 Property, plant and Equipment.
INTANGIBLE ASSETS
Intangible assets are shown at historical cost less
grants received, accumulated amortisation, and
impairment losses if applicable. Historical cost
includes costs directly attributable to the acquisition
of the particular asset.
Other long-term expenditure included in intangible
assets are amortised on a straight-line basis over
their estimated useful lives. These include computer
software and certain payments made for the use of
assets.
The amortisation periods of the intangible assets are
as follows:
»
Computer software 10 years
»
Other intangible assets 10 years.
The amortisation period of an intangible asset is
changed where necessary if the estimated useful life
changes from what was previously estimated.
Furthermore, intangible assets include carbon
dioxide (CO
2
) emission rights. Emission rights are
recognised at historical cost, and are presented under
emission rights. The current liability for returning
emission rights is recognised at the carrying value
of possessed emission rights. If there is a shortfall, a
current liability is recognised to cover the acquisition
of the missing emission rights. This current liability
is valued at the current market value of the emission
rights at the balance sheet date. The cost of the
emission rights is recognised in the income statement
under costs of materials and services. The gains
from the sales of emission rights are refunded to the
equity holders of the company.
REPORT OF THE BOARD OF DIRECTORS AND FINANCIAL STATEMENTS 2022
34
REPORT OF THE BOARD OF DIRECTORS KEY FIGURES GROUP FINANCIAL STATEMENTS PARENT COMPANY FINANCIAL STATEMENTS FINANCIAL INFORMATION
LEASES
Leases are contracts that convey the right to control
the use of an identified asset for a period of time in
exchange for consideration. Leases are recognised as
right-of-use assets and lease liability. Right-of-use
assets are recognised on the commencement date
and measured at acquisition cost, which includes the
amount of the initial measurement of lease liability,
any lease payments made before the commencement
date less any lease incentives received, and any
initial direct costs. Lease liabilities are recognised on
the commencement date, and are measured at the
present value of the remaining payments that will be
paid during the term of lease. The lease payments
are discounted using the interest rate implicit in the
lease. If that rate cannot be readily determined, the
interest rate of additional credit, i.e. the average
interest rate on the Groups loans and derivatives, is
used. Right-of-use assets are generally depreciated
according to IAS 16 Property, Plant and Equipment.
Lease payments are apportioned during the lease term
between the finance charge and the reduction of the
outstanding liability to produce a constant periodic
rate of interest on the remaining balance of the liability.
Lease payments associated with short-term leases
and all leases of low-value assets are recognised on
a straight-line basis as an expense in profit or loss.
Short-term leases are leases with a lease term of
12 months or less. Low-value assets comprise IT
equipment.
Lease payments received are recognised as income on
a straight-line basis over the lease term and presented
in the income statement under other income.
INVENTORIES
Inventories are measured at acquisition cost. The
IMPAIRMENT OF PROPERTY, PLANT AND
EQUIPMENT AND INTANGIBLE ASSETS
The Group assesses at each balance sheet date
whether there are indications that the carrying amount
of an asset may not be recoverable. If such indications
exist, the recoverable amount of the asset in question
will be measured. For the purposes of assessing
impairment, assets are examined at the level of
cash-generating units, that is, at the lowest level that
is mainly independent of other units and for which
there are separately identifiable cash flows and largely
independent from those of corresponding units.
The recoverable amount is the higher of an asset’s
fair value less costs to sell or value-in-use. The value-
in-use is determined by reference to discounted
future cash flows expected to be generated by the
asset. The discount rate used is pre-tax and reflects
the time value of money and asset specific risks.
Impairment loss is recognised when the carrying
amount of the asset is greater than its recoverable
amount. Impairment loss is charged directly to the
income statement. If a cash-generating unit is subject
to an impairment loss, it is allocated first to decrease
the goodwill and subsequently, to decrease the other
assets of the unit. At recognition of the impairment
loss, the useful life of the reamortised assets is reas
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sessed. Impairment loss of assets other than goodwill
is reversed in the case that a change has occurred
in the estimates used in measuring the recoverable
amount of the asset. The increased carrying amount
must not, however, exceed the carrying amount that
would have been determined had no impairment loss
been recognised in prior years.
acquisition cost comprises raw materials, direct labor,
and other direct costs. The carrying amount of inven
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tories is not reduced to a value that is less than its
acquisition cost, as TVO operates at cost price, so the
net realisable value of inventories always covers their
acquisition cost. The cost of supplies is determined
by using the rolling weighted average cost formula.
The use of nuclear fuel is recognised according to
calculated consumption.
FINANCIAL ASSETS
In the Group, financial assets are divided into the
following categories in accordance with the IFRS 9
standard: assets measured at fair value through profit
or loss, at fair value through other comprehensive
income items, and at amortised cost. According to the
standard, the classification is based on the business
goal of the financial assets and contractual cash flows,
and they are classified during their original acquisition.
Transaction expenses are included in the original
book value of the financial liabilities, except in the
case of items measured at fair value through profit or
loss. All purchases and sales of financial assets are
recognised at fair value on their trade date.
Financial assets are derecognised once the Group
has lost its contractual right to the cash flows or
transferred a significant portion of the risks and
revenue out of the Group.
Recognised at fair value through profit or loss
Derivative financial instruments that do not meet the
criteria for hedge accounting of the IFRS 9 standard
are recognised at fair value through profit or loss.
Profit and loss resulting from changes in fair value
are recognised in the income statement in the finan
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cial period during which they have arisen. However, if
expenses or income resulting from derivative finan
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cial instruments are caused by the construction of the
OL3 power plant, they are activated as part of the
acquisition cost of the asset.
Amortised cost
Amortised cost includes non-current loan and other
receivables, as well as current trade and other
receivables. If an item is due in over 12 months, it is
recognised as a non-current asset. After initial recog
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nition, all loan and other receivables are measured at
amortised cost using the effective interest method.
Trade receivables are recognised on the balance
sheet at their transaction price, which corresponds to
their fair value.
Fair value through other comprehensive income items
Share investments are included in the “Non-current
asset investments in shares” class and recognised at
fair value through other comprehensive income items.
Changes in fair value are entered in other compre
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hensive income items and presented in the equity fair
value reserve.
Cash and cash equivalents
Cash and cash equivalents comprise cash balances,
call deposits and other short-term, liquid invest
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ments. Items classified as cash and cash equivalents
have a maturity of no more than three months from
the date of acquisition.
Impairment of financial assets
According to the impairment model, the impairment
of financial assets must be determined using a model
based on expected credit losses. From the Group’s
perspective, the impairment model applies to trade
receivables and recognition of their credit losses.
According to the IFRS 9 standard, the Group applies
a simplified provision matrix for recognising the
REPORT OF THE BOARD OF DIRECTORS AND FINANCIAL STATEMENTS 2022
35
REPORT OF THE BOARD OF DIRECTORS KEY FIGURES GROUP FINANCIAL STATEMENTS PARENT COMPANY FINANCIAL STATEMENTS FINANCIAL INFORMATION
FINANCIAL LIABILITIES
The Group’s financial liabilities are divided into the
following categories in accordance with the IFRS 9
standard: assets measured at fair value through profit
or loss and at amortised cost.
Financial liabilities are recognised at fair value
including transaction expenses. After initial recog
-
nition, bonds and financial institution loans are
measured at amortised cost using the effective
interest method. Financial liabilities are included in
non-current and current liabilities, and may be either
interest-bearing or non-interest-bearing. An item is
credit risks in trade receivables, on the basis of
which a deductible item is recognised for all trade
receivables based on the expected credit losses over
the entire period of validity. Impairment is recorded if
there is evidence of the debtor’s insolvency, bank
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ruptcy or liquidation.
The Group’s annual credit losses have been very
minor, and the expected credit losses according to the
new model are not to have a significant impact. The
impairment model has no impact on financial assets
measured at fair value, since expected credit losses are
already taken into account in the fair value in accor-
dance with the IFRS 9 standard. As regards financial
instruments measured at amortised cost, the Group
performs active monitoring and recognises impairment
in profit or loss in accordance with the criteria.
No credit loss provisions based on expected credit
losses are recorded for financial assets recognised
at fair value through profit or loss, and no credit loss
provisions are recognised for other equity invest
-
ments recognised at fair value through other compre-
hensive income items.
recognised in current liabilities if it is due within 12
months of the closing date.
DERIVATIVE FINANCIAL INSTRUMENTS AND
HEDGE ACCOUNTING
The Group uses derivative financial instruments to
hedge against the currency risk of fuel acquisitions
and the currency and interest rate risk of loans.
Derivative financial instruments are recognised on
the balance sheet at fair value on the day on which
the Group becomes a party to the derivative financial
instruments contract, and are thereafter always
measured at fair value on the closing date.
Items covered by hedge accounting in accordance
with the IFRS 9 standard include instruments used
for hedging against the currency risk of the Groups
uranium supply contracts (forward exchange
contracts, currency swaps) and some of the interest
rate swaps used for hedging against the fluctuation
of interest cash flows in the Group’s loan agreements.
At the commencement of hedging and regularly
thereafter, the Group shall document the financial
relationship between the hedging instruments and
the hedged items, and whether changes in the cash
flows of the hedging instruments are expected to
reverse the changes in the cash flows of the hedged
items. In addition, the objectives of risk management
and the strategies according to which hedging
measures are taken are documented. Derivative
financial instruments included in hedge accounting
are divided into non-current and current assets
and liabilities based on the maturity of the hedged
instrument. The Group applies both cash flow and
fair value hedge accounting.
With the adoption of the IFRS 9 standard, the
assessment of hedge effectiveness is based on
future orientation. The ineffectiveness of the Group’s
hedging relationships is expected to continue being
very minor.
The IFRS 9 standard defines three hedge effec
-
tiveness requirements for the application of hedge
accounting. The first requirement requires a financial
relationship between the hedged item and hedging
instrument. It must be expectable that the changes in
the value of the hedging instrument and hedged item
are opposite due to the instrument or risk used as the
shared basis. Secondly, the standard requires that
changes in value due to the financial relationship are
not dominated by the impact of credit risk. Thirdly,
the hedging rate of the hedging relationship must
equal the hedging rate resulting from the amount
of the hedged item that the organisation actually
hedges and the amount of the hedging instrument
that the organisation actually uses for hedging that
amount of the hedged item. The IFRS 9 standard
requires the same hedging rate that is actually used
in risk management.
Cash flow hedging
The effective portion of the changes in the fair
value of the derivative instruments that have been
specified as cash flow hedges and meet the criteria
for cash flow hedging are entered in other compre
-
hensive income items and presented in the equity fair
value reserve. Profit or loss relating to the ineffective
portion is recognised in the income statement, except
if they are caused by the construction of the OL3
power plant, in which case the finance charges are
capitalised as part of the acquisition cost. Changes
in fair value accumulated in equity are recognised in
the balance sheet for the financial period in which the
hedged item affects the profit or loss.
In hedging against the currency risk of fuel acqui
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sitions, the hedging instrument’s profits and losses
are moved from equity to amend the cost of the
inventory item in question. In the hedging of fuel
acquisitions, profit or loss recognised in inventories
is recognised according to the inventory recognition
principles to adjust fuel acquisitions in “Materials
and services.
When the interest rate risk hedging of loans no
longer meets the requirements for applying hedge
accounting, or when a hedging instrument acquired
for hedging falls due or is sold, the profit or loss
accumulated in equity at the time in question is
recognised in profit or loss during the validity of the
hedged item in question. When the forecast trans
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action is no longer expected to take place, the profit
or loss accumulated in equity is recognised in the
income statement.
When the currency risk hedging of fuel acquisitions
no longer meets the requirements for applying
hedge accounting, or when a hedging instrument
acquired for hedging falls due or is sold, the profit
or loss accumulated in equity at the time in question
is recognised in inventories at the same time as the
purchase of inventories. When the forecast trans
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action is no longer expected to take place, the profit
or loss accumulated in equity is recognised in the
income statement.
Fair value hedging
The Group applies fair value hedge accounting in the
interest rate risk hedging of publicly quoted fixed-
rate liabilities. Changes in the fair value of derivative
instruments that meet the criteria for fair value hedge
accounting, as well as the change in fair value caused
by the interest rate risk of the related hedged items,
REPORT OF THE BOARD OF DIRECTORS AND FINANCIAL STATEMENTS 2022
36
REPORT OF THE BOARD OF DIRECTORS KEY FIGURES GROUP FINANCIAL STATEMENTS PARENT COMPANY FINANCIAL STATEMENTS FINANCIAL INFORMATION
EARNINGS PER SHARE
The Group does not report earnings per share, as the
parent company is operating at cost price. The shares
of TVO are not traded on a public market.
EQUITY
Share capital
TVO has in its possession two series of shares, A
and B. The A series entitles the shareholder to the
electricity generated by the OL1 and OL2 nuclear
power plant units. The B series entitles the share
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holder to the electricity that will be generated by the
OL3 nuclear power plant unit.
Payments received from shares in connection with
founding the Company and in the form of increases
in share capital are recognised under share capital,
statutory reserve, and share premium reserve.
Subordinated shareholder loans (hybrid equity)
Subordinated shareholder loans (hybrid equity) are
treated as equity. Subordinated shareholder loans
(hybrid equity) are initially recognised at fair value,
including related transaction costs. There is no
maturity date for the subordinated shareholder loans
(hybrid equity), but the borrower is entitled to repay
the loan in one or several installments. The Board of
Directors of the borrower has the right to decide not
to pay interest during any current interest period.
Unpaid interest does not accumulate to the following
interest periods.
The interest of the subordinated shareholder loans
(hybrid equity) are recognised in liabilities when the
obligation to pay interest is incurred. Interest expenses
are recognised on an accrual basis in the retained
earnings and are not recognised in profit or loss.
FOREIGN CURRENCY ITEMS
Transactions and financial items denominated in a
foreign currency are recognised at the rates on the
day when they occur. Receivables and liabilities
denominated in a foreign currency are measured
in the financial statements at the ECB’s official
exchange rate on the closing date. Exchange gains
and losses from operating activities are included
in the corresponding items above operating profit
or loss. Exchange differences arising from finan
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cial items are recognised in finance income and
expenses.
BORROWING COSTS
Borrowing costs are recognised in profit or loss in the
period when they have incurred, except when they
relate to the construction of a power plant or any
other significant investment, of which the completion
time exceeds one year. In that case, borrowing costs
are capitalised as part of the cost of the asset.
are recognised in profit or loss in the financial items
in the income statement. The balance sheet values of
loans and fair values of hedging instruments directed
at loans are included in interest-bearing liabilities
and assets. If the criteria for hedge accounting are
no longer met, the adjustments made to the hedged
loan are released into the income statement using the
effective interest method for the remaining maturity
of the loan.
Derivatives outside hedge accounting
Changes in the fair value of interest rate options,
interest rate swaps, and forward exchange contracts
left outside hedge accounting are presented in finan
-
cial income and expenses, to the extent that they are
not activated as part of the acquisition cost caused
by the construction of the OL3 power plant.
PROVISIONS
The Group recognises a provision for environmental
restorations, asset retirement obligations, as well as
legal and other claims, when the Group has a legal or
constructive obligation, and it is likely that an outflow
of resources will be required to settle the obligation
and the amount of the obligation can be reliably
estimated. The provision is measured at the present
value of the expenditure expected to be required to
settle the obligation. The discount rate used in the
measurement of provisions is the estimated average
risk premium of companies with TVO’s rating in
relation to risk-free interest rate plus the ECPs infla
-
tion target. The increase in the provision due to the
passage of time is recognised as interest expense.
The most significant provision is that for the nuclear
waste management obligation under the Nuclear
Energy Act. The provision covers all future expendi
-
tures arising from nuclear waste management,
including the decommissioning of nuclear power
plants, the disposal of spent fuel, and a risk margin.
Assets and provisions related to the nuclear waste
management obligation
The parent company’s nuclear waste management
obligation which is based on the Nuclear Energy Act
is covered by payments made to the Finnish State
Nuclear Waste Management Fund. The obligation
covers all the future expenditures for nuclear waste
management, including the decommissioning of
nuclear power plants, the disposal of spent fuel,
and a risk margin. The amount of payments is
determined by assuming that the decommissioning
would start at the beginning of the year following
the assessment year. The research relating to the
disposal, as well as the actual disposal of TVO’s
spent fuel, are carried out by Posiva Oy, which
charges from TVO the costs arising from these
activities, including the acquisition cost of property,
plant and equipment.
In the consolidated financial statements, TVO’s share
of the Finnish State Nuclear Waste Management
Fund is shown as non-current assets. It is accounted
for in accordance with IFRIC 5 Rights to Interests
Arising from Decommissioning, Restoration and
Environmental Rehabilitation Funds. It is stated that
the fund assets are measured at the lowest of the fair
value or the value of the related liabilities, since TVO
does not have control or joint control over the Finnish
State Nuclear Waste Management Fund. An adjust
-
ment is only recorded if the legal share in the Fund is
higher than the provision according to IFRS.
On 31 December 2022 the OL1/OL2 plant units’
share in the Fund is higher than the provision
according to IFRS, due to which an adjustment is
recorded for the OL1/OL2 plant unitsnuclear waste
management IFRS calculation. The OL3 plant unit’s
share in the Fund is in turn lower than the provision
according to IFRS, and therefore an adjustment is not
recorded (see Note 24 Assets and provisions related
to the nuclear waste management obligation).
The nuclear waste management obligation is shown
as a provision under non-current liabilities. The fair
value of the nuclear waste management provision
has been determined by discounting the future cash
flows which are based on plans about future activity
and the estimated expenditure relating to it, taking
into account actions already taken.
The present initial value of the provision for the
decommissioning of a nuclear power plant (at the
time of commissioning the nuclear power plant) has
REPORT OF THE BOARD OF DIRECTORS AND FINANCIAL STATEMENTS 2022
37
REPORT OF THE BOARD OF DIRECTORS KEY FIGURES GROUP FINANCIAL STATEMENTS PARENT COMPANY FINANCIAL STATEMENTS FINANCIAL INFORMATION
EMPLOYEE BENEFITS
The pension benefits for Group personnel have been
arranged with external pension insurance companies.
The insurance policies relating to earnings-based
pensions, as well as some voluntary pension insur
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ance policies, have been accounted for as defined
contribution plans.
Payments made to defined contribution plans as to
pensions are recognised on an accrual basis in the
income statement.
TAXES
The Group does not recognise deferred taxes,
because TVO operates at cost price. According to
this principle, TVO will not pay taxes on its opera
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tions, and therefore there is no taxable income. The
tax recognised by the Group consists of tax relating
to non-deductible expenses. It also includes any
taxes for previous financial years.
been capitalised as property, plant and equipment
and will be adjusted later for possible changes in
the plan. The amount recognised relating to decom
-
missioning will be depreciated over the estimated
operating time of the nuclear power plant.
The provision for spent fuel covers the future disposal
costs of fuel used by the end of each accounting
period. The costs for the disposal are expensed during
the operating time of the plant, based on fuel usage.
The impact of any changes to the plan will be recog
-
nised immediately in the income statement based on
fuel used by the end of each accounting period.
The timing factor is taken into account by recognising
the interest expense related to discounting the nuclear
waste management provision. The interest accruing
on TVO’s share in the Finnish State Nuclear Waste
Management Fund is presented as finance income.
TVO’s share in the Finnish State Nuclear Waste
Management Fund is higher than the corresponding
asset recognised in the balance sheet. The nuclear
waste management obligation is covered by TVO’s
share in the Fund, as required by the Nuclear Energy
Act. The obligation for nuclear waste management is
not discounted. The amount of the annual payment
to the Finnish State Nuclear Waste Management
Fund is based on the change in the nuclear waste
management obligation and funding obligation
target, the share of the profit or loss of the Fund, and
the changes resulting from actions taken.
According to the Nuclear Energy Act Section 52 c,
which entered into force on 1 May 2021, a three
percent protected portion shall be added to the
Fund target of the calendar year for a party with a
nuclear waste management obligation. The protected
portion shall primarily be covered by the surplus as
defined in the Nuclear Energy Act Section 42 and
the Fund’s profit as defined in the Nuclear Energy
Act Section 51. If the Fund’s investment activities
are unprofitable, the party with a nuclear waste
management obligation must supplement the shares
in the Fund by paying more nuclear waste manage
-
ment fee for the part that the loss surpasses the
protected portion. If the Fund’s investment activities
are profitable, the Fund reimburses the party with a
nuclear waste management obligation in the nuclear
waste management fee for the part that the profit
surpasses the protected portion.
In addition, a party with a nuclear waste manage
-
ment obligation shall supply the Finnish State
Nuclear Waste Management Fund with collateral
security fulfilling the conditions provided in Section
45 so that on the last day of March, the total amount
of the collateral security corresponds with the
protected portion for the part that is not covered
by the transferred surplus and profit. Accordingly,
the collateral security previously supplied by the
party with a nuclear waste management obliga
-
tion, which is not needed to cover the protected
portion anymore, shall be returned to the party
with a nuclear waste management obligation at the
latest on the first business day of April in the same
calendar year.
CRITICAL ACCOUNTING ESTIMATES AND
JUDGEMENTS
The preparation of financial statements requires
estimates and assumptions concerning the future.
Estimates and assumptions have an effect on the
reported amounts of assets and liabilities, and
expenses and income during the accounting period.
The actual results may differ from these estimates.
The provision for future obligations for the
decommissioning of the nuclear power plant and
for the disposal of spent fuel
Estimates and assumptions have been used when
estimating the assets, liabilities, expenses, and
income related to the future decommissioning of the
nuclear power plant and the disposal of spent fuel.
These are based on long-term cash flow forecasts of
estimated future costs.
The main assumptions relate to technical plans, time
factor, cost estimates, and the discount rate. The
technical plans are approved by State authorities.
Any changes in the assumed discount rate would
change the provision. If the discount rate used were
lowered, the provision would increase.
Any future increase in the provision would be offset
by the recognition of an equal increase in TVO’s
share in the assets of the Finnish State Nuclear
Waste Management Fund. According to IFRS, the
carrying amount of the assets is limited to the value
of the provision, as TVO does not have control in the
Finnish State Nuclear Waste Management Fund (see
Note 24 Assets and provisions related to nuclear
waste management obligation). The provision
related to nuclear waste management obligation of
the OL3 plant unit was recorded in the balance sheet
for the first time when the unit was made critical on
21 December 2021.
Olkiluoto 3 EPR
OL3 is a nuclear power plant unit currently under
the test production phase, which was procured as a
fixed-price turnkey project.
In March 2018, TVO signed a comprehensive Global
Settlement Agreement (GSA) concerning the comple
-
tion of the OL3 project and related disputes with
the Plant Supplier consortium companies Areva NP,
Areva GmbH, and Siemens AG as well as with the
Areva Group parent company Areva SA, a company
wholly owned by the French State. The GSA was
amended with agreements signed in June 2021.
In the GSA, 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 for completing the OL3 project. During the
accounting period, the fund, which was previously
replenished by Areva in July 2021, has been used to
cover costs incurred to the Areva companies for the
completion of the OL3 project in accordance with
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REPORT OF THE BOARD OF DIRECTORS KEY FIGURES GROUP FINANCIAL STATEMENTS PARENT COMPANY FINANCIAL STATEMENTS FINANCIAL INFORMATION
the GSA. During the accounting period, TVO has recorded receivables from the Plant Supplier for the addi-
tional delay compensation accumulated by the end of the accounting period in accordance with the amended
settlement agreement.
TVO’s right to terminate the Plant Contract in accordance with the GSA was postponed until 31 March 2023.
In addition, the payment of approximately EUR 193 million of the delay compensation agreed in the GSA of
2018 was postponed until the completion of OL3, up to 31 March 2023 at the latest.
According to the Plant Suppliers latest project schedule, TVOs current cost estimate, and the effects of the
GSA, TVO estimates that its total investment in the OL3 project will be approximately EUR 5.8 billion.
All payments related to the settlement compensations have been recorded in the consolidated balance sheet
as property, plant and equipment. At the end of the accounting period the delay compensation agreed in the
GSA of 2018 from the Plant Supplier were EUR 193.1 million in the current receivables and EUR 56.7 million
in the non-current receivables.
The Radiation and Nuclear Safety Authority granted a fuel loading permit for OL3 in March 2021, and the fuel
loading was completed in April 2021. The completion of fuel loading meant that the OL3 plant unit is a nuclear
power plant in use. The first criticality of the OL3 plant unit was achieved on 21 December 2021.
All the realised costs of the OL3 project that meet recognition criteria have been booked as acquisition costs of
property, plant and equipment on the Group balance sheet. TVO’s management has estimated that there are
no known technical or other issues that would prevent the completion of the OL3 project from the test produc
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tion phase to regular electricity production. The recognition criteria of the acquisition costs of the OL3 project
are realised because all the necessary actions will be completed to prepare the asset for its intended use.
Impairment testing
Impairment testing of non-current assets is performed when there are indications that the carrying amount
of an asset may not be recoverable. In testing, future discounted cash flows which can be recovered by use of
the asset and its possible sale are used as an indicator.
TVO operates on a cost-price principle. According to the company documents, the shareholders are obliged to
pay all the expenses of the Company in electricity prices, including amortisation of property, plant and equip
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ment. When assessing by means of recoverable amounts, possible impairment of assets and subsequent need
for recognition of impairment loss, the recoverable amounts always correspond, with some exceptions, to the
carrying amount of the asset and thus, as a rule, no need for recognition of impairment loss arises.
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REPORT OF THE BOARD OF DIRECTORS KEY FIGURES GROUP FINANCIAL STATEMENTS PARENT COMPANY FINANCIAL STATEMENTS FINANCIAL INFORMATION
4 Segment reporting
SEGMENT STRUCTURE IN THE TVO GROUP
The Group has one reportable segment; nuclear power.
The electricity of the nuclear power segment is produced at three nuclear power plant units, Olkiluoto 1 (OL1),
Olkiluoto 2 (OL2) and Olkiluoto 3 (OL3). Olkiluoto 3 (OL3) is currently under the test production phase. The
subsidiary of TVO, TVO Nuclear Services Oy (TVONS), the operation of which is related to nuclear power, is
also included in the nuclear power segment.
Segment calculation principles
The Board of Directors monitors reporting in accordance both with the Finnish Accounting Standards (FAS)
and IFRS-standards. TVO Group discloses in the Note Segment reporting; turnover, depreciation and impair
-
ment charges, finance income and expenses, profit/loss for the year and assets.
The segment reporting TVO Group discloses is based on the internal reporting the chief operating decision
maker follows. The same accounting policies are used in the segment reporting and TVO Groups financial
statements. Adjustments made under IFRS accounting policies are reported at the Group level.
Turnover by segments
EUR 1,000 2022 2021
Nuclear power 358,208 298,713
Total 358,208 298,713
Depreciation and impairment charges by segments
EUR 1,000 2022 2021
Nuclear power -40,690 -37,650
Depreciation and impairment charges (FAS) -40,690 -37,650
The impact of the nuclear waste management obligation -5,493 -5,791
Other IFRS adjustments -809 -555
Total (IFRS) -46,992 -43,996
Assets and liabilities related to contracts with customer
EUR 1,000 31 Dec 2022 31 Dec 2021
Trade receivables 9,428 8,854
Advance payments received 23,033 21,182
Revenue recognised in relation to contract liabilities
EUR 1,000 2022 2021
Revenue recognised that was included in the contract liability balance at the beginning of the period 21,182 19,758
Total 21,182 19,758
3 Turnover
The fixed costs, or liabilities based on customer contracts, are invoiced one month in advance and recognised
as advance payments received.
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REPORT OF THE BOARD OF DIRECTORS KEY FIGURES GROUP FINANCIAL STATEMENTS PARENT COMPANY FINANCIAL STATEMENTS FINANCIAL INFORMATION
Profit/loss for the financial year by segments
EUR 1,000 2022 2021
Nuclear power -9,909 -3,573
Profit/loss before appropriations (FAS) -9,909 -3,573
The impact of the nuclear waste management obligation -36,528 -17,424
The impact of financial instruments -503 -514
Other IFRS adjustments 681 578
The impact of joint ventures -1,619 1,280
Total (IFRS) -47,878 -19,653
Assets by segments
EUR 1,000 2022 2021
Nuclear power 7,601,716 7,155,886
Total (FAS) 7,601,716 7,155,886
The impact of the nuclear waste management obligation 1,367,840 1,478,313
The impact of financial instruments 194,825 11,113
The impact of finance leases 46,072 47,953
Other IFRS adjustments -42,319 -35,506
The impact of joint ventures 2,886 4,504
Total (IFRS) 9,171,020 8,662,263
Trade receivables by segments
EUR 1,000 2022 2021
Nuclear power 9,975 10,183
Total (FAS) 9,975 10,183
Total (IFRS) 9,975 10,183
Turnover shared to production of electricity and services
EUR 1,000 2022 2021
Production of electricity 353,479 293,781
Services 4,729 4,932
Total 358,208 298,713
Trade receivables shared to production of electricity and services
EUR 1,000 2022 2021
Production of electricity 9,780 9,301
Services 195 882
Total 9,975 10,183
GROUP-WIDE DISCLOSURES
INFORMATION ABOUT GEOGRAPHICAL AREAS
Teollisuuden Voima Oyj is company owned by Finnish industrial and power companies. TVO delivers electricity
to its shareholders at cost price (so-called Mankala principle), i.e. delivers the electricity produced to its
shareholders in proportion to their shareholdings in each series.
The Group assets are located in Finland except part of inventories of nuclear fuel acquisition.
Finance income and expenses by segments
EUR 1,000 2022 2021
Nuclear power 3,822 -11
Finance income and expenses (FAS) 3,822 -11
The impact of the nuclear waste management obligation -77,197 -37,262
The impact of financial instruments -503 -514
The impact of joint ventures -2,209 0
Other IFRS adjustments 902 581
Total (IFRS) -75,185 -37,206
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REPORT OF THE BOARD OF DIRECTORS KEY FIGURES GROUP FINANCIAL STATEMENTS PARENT COMPANY FINANCIAL STATEMENTS FINANCIAL INFORMATION
5 Work performed for own purpose
EUR 1,000 2022 2021
Personnel expenses related to OL3 21,310 25,036
Total 21,310 25,036
6 Other income
EUR 1,000 2022 2021
Rental income 1,144 1,101
Sales of services 10,564 11,144
Other income 1,360 1,201
Total 13,068 13,446
7 Materials and services
EUR 1,000 2022 2021
Nuclear fuel 60,845 61,757
Materials and supplies 6,084 5,011
CO
2
emission rights 110 151
Nuclear waste management services
1)
54,239 15,018
Increase (-) or decrease (+) in inventories 6,948 -964
External services 9,658 9,867
Total 137,884 90,840
1)
 See Note 24 Assets and provision related to nuclear waste management obligation.
Employee benefit costs
EUR 1,000 2022 2021
Wages and salaries 67,398 69,052
Pension expenses - defined contribution plans 10,668 10,616
Other compulsory personnel expenses 2,250 2,474
Total 80,316 82,142
Wages, salaries and other compensation for key management are presented in Note 26 Related party.
EMPLOYEE BONUS SYSTEM
The Nomination and Remuneration Committee under the Board of Directors approves TVO’s commitment
and remuneration systems. All permanent and long-term temporary employees are included in the employee
bonus system. Some of the personnel have deposited their bonuses in the Teollisuuden Voima Personnel Fund.
Average number of personnel during financial year
2022 2021
Office personnel 836 811
Manual workers 195 193
Total 1,031 1,004
Number of personnel on 31 December
2022 2021
Office personnel 818 793
Manual workers 189 191
Total 1,007 984
8 Personnel expenses
REPORT OF THE BOARD OF DIRECTORS AND FINANCIAL STATEMENTS 2022
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REPORT OF THE BOARD OF DIRECTORS KEY FIGURES GROUP FINANCIAL STATEMENTS PARENT COMPANY FINANCIAL STATEMENTS FINANCIAL INFORMATION
9 Depreciation and impairment charges
EUR 1,000 2022 2021
Intangible assets
ICT software
372 370
Other intangible assets 38 38
Total 410 408
Property, plant and equipment
Buildings and construction
4,891 3,786
Machinery and equipment 35,787 33,359
Other property, plant and equipment 410 652
Decommissioning 5,494 5,791
Total 46,582 43,588
Total 46,992 43,996
10 Other expenses
EUR 1,000 2022 2021
Maintenance services 21,365 24,297
Regional maintenance and service 9,651 10,428
Research services 2,338 2,416
Other external services 26,265 30,602
Real estate tax 6,489 6,034
Rents 1,457 1,397
ICT expenses 6,207 6,079
Personnel related expenses 4,220 4,005
Corporate communication expenses 867 837
Other expenses 21,766 17,849
Total 100,625 103,944
Auditors’ fees and non-audit related services
PricewaterhouseCoopers Oy (EUR 1,000) 2022 2021
Auditing 238 267
Tax services 13 28
Other services 65 70
Total 316 365
REPORT OF THE BOARD OF DIRECTORS AND FINANCIAL STATEMENTS 2022
43
REPORT OF THE BOARD OF DIRECTORS KEY FIGURES GROUP FINANCIAL STATEMENTS PARENT COMPANY FINANCIAL STATEMENTS FINANCIAL INFORMATION
Items included in the income statement
EUR 1,000 2022 2021
Interest income from loans and other receivables
Nuclear waste management loan receivables from equity holders of the company
3,377 3,612
Other 2,665 494
Hedge accounted derivatives
Ineffective portion of the change in fair value in fair value hedge relationship
1 0
Non-hedge accounted derivatives
Change in fair value
252 127
Interest income from assets related to nuclear waste management 0 448
Finance income, total 6,295 4,681
Interest expenses and other finance expenses
To the Finnish State Nuclear Waste Management Fund
3,377 3,612
To others 148 -76
Hedge accounted derivatives
1)
Ineffective portion of the change in fair value in fair value hedge relationship 1 0
Non-hedge accounted derivatives
Change in fair value
757 641
Interest expenses of provision related to nuclear waste management 77,197 37,710
Finance expenses, total 81,480 41,887
Total -75,185 -37,206
1)
 In hedge accounting the change in fair value adjustment of the loan was EUR 32.1 (5.6) million and the change of the fair value in hedging
instruments was EUR -31.7 (-5.5) million. The ineffective portion is recognised as EUR 0 thousand in profit or loss and the change in fair
value resulting from ineffectiveness is activated in the balance sheet.
Other comprehensive items
Other comprehensive items related to derivative financial instruments:
EUR 1,000 2022 2021
Cash flow hedges
Changes in the fair value of which the following items have transferred
207,593 35,329
Transfers to the consolidated income statement -18 0
Transfers to inventories 3,144 498
Transfers to the nuclear power plant under construction -7,269 -9,533
Transferred items, total -4,143 -9,034
Cash flow hedges, total 211,736 44,363
Total other comprehensive items 211,736 44,363
11 Finance income and expenses
12 Income tax expense
EUR 1,000 2022 2021
Taxes based on the taxable income of the financial year 52 0
Total 52 0
TVO operates at cost price (so called Mankala principle, see Note 1 General information on the Group), so
TVO does not pay income tax during its operations. Taxes for the financial year consist of non-deductible
expenses in taxation.
REPORT OF THE BOARD OF DIRECTORS AND FINANCIAL STATEMENTS 2022
44
REPORT OF THE BOARD OF DIRECTORS KEY FIGURES GROUP FINANCIAL STATEMENTS PARENT COMPANY FINANCIAL STATEMENTS FINANCIAL INFORMATION
13 Property, plant and equipment
2022
EUR 1,000 Land and water areas Buildings and construction Machinery and equipment
Other property,
plant and equipment
Construction in progress
and advance payments Decommissioning Total
Acquisition cost 1 Jan 12,054 294,375 1,372,954 54,322 5,198,735 574,838 7,507,278
Increase 21 3,934 20,206 880 286,317 0 311,358
Decrease 0 -1,623 -8,344 -12 -19,329 -59,418 -88,726
Transfer between categories 0 4,443 34,181 0 -38,624 0 0
Acquisition cost 31 Dec 12,075 301,129 1,418,997 55,190 5,427,099 515,420 7,729,910
Accumulated depreciation and impairment charges according to plan 1 Jan 0 229,791 953,454 49,382 0 96,897 1,329,524
Accumulated depreciation from deduction 0 -1,623 -8,344 -12 0 0 -9,979
Depreciation for the period 0 4,891 35,787 410 0 5,494 46,582
Accumulated depreciation and impairment charges according to plan 31 Dec 0 233,059 980,897 49,780 0 102,391 1,366,127
Book value 31 Dec 2022 12,075 68,070 438,100 5,410 5,427,099 413,029 6,363,783
Book value 1 Jan 2022 12,054 64,584 419,500 4,940 5,198,735 477,941 6,177,754
2021
EUR 1,000 Land and water areas Buildings and construction Machinery and equipment
Other property,
plant and equipment
Construction in progress
and advance payments Decommissioning Total
Acquisition cost 1 Jan 12,054 277,891 1,393,115 54,172 5,054,334 218,551 7,010,117
Increase 0 949 23,760 150 184,937 367,919 577,715
Decrease 0 -33 -59,532 0 -9,357 -11,632 -80,554
Transfer between categories 0 15,568 15,611 0 -31,179 0 0
Acquisition cost 31 Dec 12,054 294,375 1,372,954 54,322 5,198,735 574,838 7,507,278
Accumulated depreciation and impairment charges according to plan 1 Jan 0 226,005 979,627 48,730 0 91,106 1,345,467
Accumulated depreciation from deduction 0 0 -59,532 0 0 0 -59,532
Depreciation for the period 0 3,786 33,359 652 0 5,791 43,588
Accumulated depreciation and impairment charges according to plan 31 Dec 0 229,791 953,454 49,382 0 96,897 1,329,523
Book value 31 Dec 2021 12,054 64,584 419,500 4,940 5,198,735 477,941 6,177,755
Book value 1 Jan 2021 12,054 51,886 413,488 5,442 5,054,334 127,445 5,664,650
The costs for the plant unit currently under the test production phase (OL3) constituted EUR 5.4 billion of the advance payments in 2022 (EUR 5.1 billion in 2021).
Once the OL3 plant unit proceeds to commercial operation, approximately EUR 250 million will be transferred from the OL3 investment to the value of the nuclear fuel and uranium stock.
REPORT OF THE BOARD OF DIRECTORS AND FINANCIAL STATEMENTS 2022
45
REPORT OF THE BOARD OF DIRECTORS KEY FIGURES GROUP FINANCIAL STATEMENTS PARENT COMPANY FINANCIAL STATEMENTS FINANCIAL INFORMATION
Right-of-use assets
EUR 1,000
Construction in
progress
Buildings and
construction
Machinery and
equipment
Book value 1 Jan 2022 72,741 273 212
Increase 0 2,436 128
Depreciation for the period 0 -398 -170
Book value 31 Dec 2022 72,741 2,311 170
Depreciation charge of right-of-use assets
EUR 1,000 2022 2021
Buildings and construction 398 209
Machinery and equipment 170 182
Total 568 391
Interest expense (included in finance expenses) -70 179
Expenses relating to short-term leases (included in other expenses) 40 6
Expenses relating to leases of low-value assets that are not shown above as short-term
leases (included in other expenses)
697 704
EUR 1,000
Construction in
progress
Buildings and
construction
Machinery and
equipment
Book value 1 Jan 2021 72,741 517 310
Increase 0 162 84
Decrease 0 -197 0
Depreciation for the period 0 -209 -182
Book value 31 Dec 2021 72,741 273 212
Amounts recognised in the statement of profit or loss
The statement of profit or loss shows the following amounts relating to leases:
Part of the assets acquired through lease agreements is accumulated as costs for construction in progress
so there is no accumulated depreciation.
Lease liabilities
EUR 1,000 2022 2021
Current 2,467 2,060
Non-current 47,099 47,350
Total 49,566 49,410
The total cash outflow for leases in 2022 was EUR 3,075 (3,006) thousand.
The Group’s leasing activities and how these are accounted for
The Group leases a spare part of the nuclear power plant, offices, vehicles and equipments. These rental
contracts are made for periods of under a year to five years. Part of the contracts of buildings and construc
-
tions are valid until further notice. The holding period of these leases are based on the management’s judge-
ment. The property of construction in progress can be redeemed at the earliest in 2025.
The lease payments are discounted using the interest rate implicit in the lease, if the rate can readily be
determined. If that rate cannot be readily determined, the incremental borrowing rate or average interest rate
on the Group’s loans and derivatives is used. For the average interest rate on loans and derivatives on 31
December, see Note 27. Payments associated with short-term leases of equipment and vehicles and all leases
of low-value assets are recognised on a straight-line basis as an expense in profit or loss. Short-term leases
are leases with a lease term of 12 months or less. Low-value assets comprise IT equipment.
LEASES
Amounts recognised in the balance sheet
The balance sheet shows the following amounts relating to leases:
REPORT OF THE BOARD OF DIRECTORS AND FINANCIAL STATEMENTS 2022
46
REPORT OF THE BOARD OF DIRECTORS KEY FIGURES GROUP FINANCIAL STATEMENTS PARENT COMPANY FINANCIAL STATEMENTS FINANCIAL INFORMATION
14 Intangible assets
2022
EUR 1,000 CO
2
emission rights Computer software Other intangible assets Advance payments Total
Acquisition cost 1 Jan 159 21,853 4,117 276 26,405
Increase 110 297 0 76 483
Decrease -140 0 -274 0 -414
Transfer between categories 0 0 0 0 0
Acquisition cost 31 Dec 129 22,150 3,843 352 26,474
Accumulated depreciation and impairment charges according to plan 1 Jan 0 20,197 3,666 0 23,863
Accumulated depreciation from deduction 0 0 -275 0 -275
Depreciation for the period 0 372 38 0 410
Accumulated depreciation and impairment charges according to plan 31 Dec 0 20,569 3,429 0 23,998
Book value 31 Dec 2022 129 1,581 414 352 2,476
Book value 1 Jan 2022 159 1,656 451 276 2,542
2021
EUR 1,000 CO
2
emission rights Computer software Other intangible assets Advance payments Total
Acquisition cost 1 Jan 59 21,597 4,117 270 26,044
Increase 151 256 -63 69 413
Decrease -51 0 0 0 -51
Transfer between categories 0 0 63 -63 0
Acquisition cost 31 Dec 159 21,853 4,117 276 26,406
Accumulated depreciation and impairment charges according to plan 1 Jan 0 19,827 3,628 0 23,455
Accumulated depreciation from deduction 0 0 0 0 0
Depreciation for the period 0 370 38 0 408
Accumulated depreciation and impairment charges according to plan 31 Dec 0 20,197 3,666 0 23,863
Book value 31 Dec 2021 159 1,656 451 276 2,543
Book value 1 Jan 2021 59 1,770 489 270 2,588
REPORT OF THE BOARD OF DIRECTORS AND FINANCIAL STATEMENTS 2022
47
REPORT OF THE BOARD OF DIRECTORS KEY FIGURES GROUP FINANCIAL STATEMENTS PARENT COMPANY FINANCIAL STATEMENTS FINANCIAL INFORMATION
Capitalised interest costs during construction
2022
EUR 1,000 Other intangible assets Buildings and construction Machinery and equipment
Other property,
plant and equipment Advance payments Total
Acquisition cost 1 Jan 1,167 27,122 95,394 2,402 1,636,089 1,762,174
Increase 0 0 0 0 97,471 97,471
Decrease 0 0 0 0 -7,842 -7,842
Acquisition cost 31 Dec 1,167 27,122 95,394 2,402 1,725,718 1,851,803
Accumulated depreciation and impairment charges according to plan 1 Jan 936 21,735 76,446 1,925 0 101,042
Depreciation for the period 12 284 997 25 0 1,318
Accumulated depreciation and impairment charges according to plan 31 Dec 948 22,019 77,443 1,950 0 102,360
Book value 31 Dec 2022 219 5,103 17,951 452 1,725,718 1,749,443
Book value 1 Jan 2022 231 5,387 18,948 477 1,636,089 1,661,132
2021
EUR 1,000 Other intangible assets Buildings and construction Machinery and equipment
Other property,
plant and equipment Advance payments Total
Acquisition cost 1 Jan 1,167 27,122 95,394 2,402 1,548,448 1,674,533
Increase 0 0 0 0 90,049 90,049
Decrease 0 0 0 0 -2,408 -2,408
Acquisition cost 31 Dec 1,167 27,122 95,394 2,402 1,636,089 1,762,174
Accumulated depreciation and impairment charges according to plan 1 Jan 923 21,452 75,449 1,900 0 99,724
Depreciation for the period 13 283 997 25 0 1,318
Accumulated depreciation and impairment charges according to plan 31 Dec 936 21,735 76,446 1,925 0 101,042
Book value 31 Dec 2021 231 5,387 18,948 477 1,636,089 1,661,132
Book value 1 Jan 2021 244 5,670 19,945 502 1,548,448 1,574,809
CAPITALISED BORROWING COSTS INCLUDED IN PROPERTY, PLANT AND EQUIPMENT, AND INTANGIBLE ASSETS
The borrowing costs of the power plant under the test production phase (OL3) have been capitalised. Realised financial income and expenses have
been divided by committed capital. The average share of capitalised borrowing costs in 2022 was 99.75 % (100.00 % in 2021). For the average
interest rate on loans and derivatives on 31 December, see Note 27.
REPORT OF THE BOARD OF DIRECTORS AND FINANCIAL STATEMENTS 2022
48
REPORT OF THE BOARD OF DIRECTORS KEY FIGURES GROUP FINANCIAL STATEMENTS PARENT COMPANY FINANCIAL STATEMENTS FINANCIAL INFORMATION
Summarised balance sheet
EUR 1,000 Posiva Group 2022 Posiva Group 2021
Current
Cash and cash equivalents
22,234 28,383
Other current assets (excluding cash) 5,021 7,599
Total current assets 27,255 35,982
Financial liabilities (excluding trade payables) 0 -334
Other current liabilities (including trade payables) -21,972 -24,203
Total current liabilities -21,972 -24,537
Non-current
Assets
4,301 117
Financial liabilities -3,981 -3,760
Total non-current liabilities -3,981 -3,760
Net assets 5,603 7,802
Summarised statement of comprehensive income 2022 2021
Turnover 119,024 130,124
Depreciation and impairment charges -18 -25
Interest income 14 21
Interest expense -114 -105
Pre-tax profit from continuing operations 1,005 2,176
Income tax expense -204 -438
Post-tax profit from continuing operations 801 1,738
Reconciliation of summarised financial information 2022 2021
Operating net assets 1 Jan 7,802 6,064
Profit/loss for the period 801 1,738
Dividend distribution -3,000 0
Closing net assets 5,603 7,802
Interest in joint venture 3,897 5,516
Carrying value 3,897 5,516
15 Investments in joint ventures
EUR 1,000 2022 2021
Posiva Group 3,897 5,516
31 Dec 3,897 5,516
Nature of investment in joint ventures
Name of entity Place of incorporation Group share, % Measurement method
Posiva Oy - A series Eurajoki 60 Equity
Posiva Oy - B series Eurajoki
74 Equity
TVO has a 60 percent shareholding in Posiva Oy. Posiva is responsible for the research and implementation of
final disposal of spent nuclear fuel of its shareholders TVO and Fortum Power and Heat Oy (FPH).
TVO governs Posiva Oy jointly with FPH, based on the Articles of Association and Shareholders Agreement.
TVO is liable for approximately 74 percent of Posiva’s expenses. The duty of Posiva is to carry out all tasks
related to the final disposal of spent nuclear fuel of its shareholder’s nuclear power plants in Finland in order
to fulfil their nuclear waste management obligation as specified in the Nuclear Energy Act. The company’s
operations also include research and construction related to the final disposal solution. Management of
spent fuel is carried out according to the detailed plan examined by the Finnish Radiation and Nuclear Safety
Authority and approved by The Ministry of Economic Affairs and Employment.
Posiva Solutions Oy, a wholly-owned subsidiary of Posiva Oy, was founded on 20 May 2016. Posiva Solutions
Oy focuses on the sales of the know-how Posiva has accumulated from its design, research and development
activities in the final disposal of spent nuclear fuel, as well as on associated consulting services.
SUMMARISED FINANCIAL INFORMATION (FAS) FOR THE POSIVA GROUP
Posiva Oy and Posiva Solutions Oy are private companies and there are no quoted market prices available for
their shares.
In the consolidated financial statements, the Posiva Group is accounted for according to the equity method of
accounting.
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REPORT OF THE BOARD OF DIRECTORS KEY FIGURES GROUP FINANCIAL STATEMENTS PARENT COMPANY FINANCIAL STATEMENTS FINANCIAL INFORMATION
16 Book values of financial assets and liabilities by categories
2022
EUR 1,000 Fair value through profit or loss
At fair value through other
comprehensive income items Amortised cost Book value total Fair value total Note
Non-current assets
Loans and other receivables 710,962 710,962 710,962 17
Share investments 1,935 1,935 1,935 18
Derivative financial instruments, no hedge accounting 388 388 388 20
Derivative financial instruments, cash flow hedge accounting 224,795 224,795 224,795 20
Current assets
Trade and other receivables
233,078 233,078 233,078 17
Derivative financial instruments, no hedge accounting 195 195 195 20
Derivative financial instruments, cash flow hedge accounting 4,268 4,268 4,268 20
Cash and cash equivalents 353,203 353,203 353,203
Total by category 583 230,998 1,297,242 1,528,823 1,528,823
Non-current liabilities
Loan from the Finnish State Nuclear Waste Management Fund
651,339 651,339 651,339 22
Other financial liabilities 4,531,264 4,531,264 4,275,708 22
Derivative financial instruments, no hedge accounting 13,637 13,637 13,637 20
Derivative financial instruments, fair value hedge accounting 26,403 26,403 26,403 20
Current liabilities
Current financial liabilities
258,669 258,669 258,669 22
Trade payables 16,821 16,821 16,821 23
Other current liabilities 137,417 137,417 137,417 23
Derivative financial instruments, no hedge accounting 95 95 95 20
Derivative financial instruments, cash flow hedge accounting 447 447 447 20
Derivative financial instruments, fair value hedge accounting 2 2 2 20
Total by category 40,137 447 5,595,510 5,636,094 5,380,538
REPORT OF THE BOARD OF DIRECTORS AND FINANCIAL STATEMENTS 2022
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REPORT OF THE BOARD OF DIRECTORS KEY FIGURES GROUP FINANCIAL STATEMENTS PARENT COMPANY FINANCIAL STATEMENTS FINANCIAL INFORMATION
2021
EUR 1,000 Fair value through profit or loss
At fair value through other
comprehensive income items Amortised cost Book value total Fair value total Note
Non-current assets
Loans and other receivables 714,027 714,027 714,027 17
Share investments 1,935 1,935 1,935 18
Derivative financial instruments, no hedge accounting 4,639 4,639 4,639 20
Derivative financial instruments, cash flow hedge accounting 24,778 24,778 24,778 20
Derivative financial instruments, fair value hedge accounting 4,549 4,549 4,549 20
Current assets
Trade and other receivables
261,834 261,834 261,834 17
Derivative financial instruments, no hedge accounting 4,132 4,132 4,132 20
Derivative financial instruments, cash flow hedge accounting 2,974 2,974 2,974 20
Derivative financial instruments, fair value hedge accounting 703 703 703 20
Cash and cash equivalents 172,318 172,318 172,318
Total by category 14,023 29,687 1,148,179 1,191,889 1,191,889
Non-current liabilities
Loan from the Finnish State Nuclear Waste Management Fund
711,266 711,266 711,266 22
Other financial liabilities 3,877,192 3,877,192 3,953,937 22
Derivative financial instruments, no hedge accounting 3,161 3,161 3,161 20
Derivative financial instruments, cash flow hedge accounting 7,580 7,580 7,580 20
Current liabilities
Current financial liabilities
445,619 445,619 445,619 22
Trade payables 56,672 56,672 56,672 23
Other current liabilities 104,936 104,936 104,936 23
Derivative financial instruments, no hedge accounting 18 18 18 20
Derivative financial instruments, cash flow hedge accounting 3,250 3,250 3,250 20
Total by category 3,179 10,829 5,195,685 5,209,693 5,286,439
REPORT OF THE BOARD OF DIRECTORS AND FINANCIAL STATEMENTS 2022
51
REPORT OF THE BOARD OF DIRECTORS KEY FIGURES GROUP FINANCIAL STATEMENTS PARENT COMPANY FINANCIAL STATEMENTS FINANCIAL INFORMATION
Disclosure of fair value measurements by the level of fair value measurement hierarchy
2022
EUR 1,000 Level 1 Level 2 Level 3
Financial assets at fair value
Derivative financial instruments at fair value through profit or loss
583
Derivative financial instruments designated as cash flow hedges 229,063
Share investments 1,935
Total 229,646 1,935
Financial liabilities at fair value
Derivative financial instruments at fair value through profit or loss
13,732
Derivative financial instruments designated as cash flow hedges 447
Derivative financial instruments designated as fair value hedges 26,404
Total 40,584
2021
EUR 1,000 Level 1 Level 2 Level 3
Financial assets at fair value
Derivative financial instruments at fair value through profit or loss
8,771
Derivative financial instruments designated as cash flow hedges 27,752
Derivative financial instruments designated as fair value hedges 5,252
Share investments 1,935
Total 41,775 1,935
Financial liabilities at fair value
Derivative financial instruments at fair value through profit or loss
3,179
Derivative financial instruments designated as cash flow hedges 10,829
Total 14,008
FAIR VALUE ESTIMATION
The derivative financial instruments are initially recognised at fair value on the date a derivative contract is
entered into and are subsequently measured at fair value. The fair values are determined using a variety of
methods and financial valuation techniques, and assumptions are based on market quotations at the balance
sheet date (Level 2). The fair value of the interest rate swaps is the present value of the estimated future cash
flows. The forward contracts are measured using the market quotes at the closing date. The changes in fair
value of the interest rate swaps and forward contracts are recognised in equity or profit or loss, depending on
whether they qualify for cash flow hedges or not.
On 31 December 2022, TVO has unquoted shares worth EUR 1,935 (2021: 1,935) thousand. Direct market
prices are not available for unquoted shares and therefore their fair value is determined using methods based
on management judgement.
Fair values of long-term loans, have been estimated as follows:
Listed bonds are traded on an active market and their fair values are based on the quoted market value as of
31 December (Level 1). The fair value of fixed rate and market-based floating rate loans is estimated using the
expected future payments discounted at market interest rates (Level 2).
The carrying amounts of current financial assets and liabilities approximate their fair value, as the impact of
discounting is not significant.
According to IFRS 9, all derivatives are classified as at fair value through profit or loss. In the table, derivatives
subject to cash flow hedge accounting are presented according to the method of recognition, i.e. at fair value
through other comprehensive income.
REPORT OF THE BOARD OF DIRECTORS AND FINANCIAL STATEMENTS 2022
52
REPORT OF THE BOARD OF DIRECTORS KEY FIGURES GROUP FINANCIAL STATEMENTS PARENT COMPANY FINANCIAL STATEMENTS FINANCIAL INFORMATION
2021
EUR 1,000 Gross amounts
Related amounts
not set off Net amount
Derivative financial assets 41,775 -9,977 31,798
Derivative financial liabilities -14,008 9,977 -4,031
For the financial derivative assets and liabilities subject to enforceable master netting arrangements or similar
arrangements above, each agreement between the Group and the counterparty allows for net settlement of
the relevant financial derivative assets and liabilities when both elect to settle on a net basis. In the absence
of such an election, financial assets and liabilities will be settled on a gross basis; however, each party to the
master netting agreement or similar agreement will have the option to settle all such amounts on a net basis in
the event of default of the other party. Per the terms of each agreement, an event of default includes failure by
a party to make payment when due.
Loans and other receivables (non-current assets)
EUR 1,000 2022 2021
Nuclear waste management loan receivables 651,339 711,266
Loan receivables 2,893 2,761
Other receivables 56,730 0
Total 710,962 714,027
Nuclear waste management loan receivables are allocated as follows:
EUR 1,000 2022 2021
EPV Energia Oy 56,467 71,296
Fortum Oyj 228,962 289,209
Oy Mankala Ab 0 761
Kemira Oyj 15,910 0
Pohjolan Voima Oyj 350,000 350,000
Total 651,339 711,266
17 Loans and other receivables
The loan receivables constitute mainly the loan receivables of Posiva Oy EUR 2,389 (2,256) thousand. Other
receivables constitute mainly of the OL3 delay project compensation EUR 56,700 (0) thousand.
According to section 52 of the Nuclear Energy Act, TVO, in exchange for collateral payments, is entitled to
receive fixed-term loans from the Finnish State Nuclear Waste Management Fund, the amount which cannot
be larger than 60 percent of the latest confirmed TVO’s share in the Finnish State Nuclear Waste Management
Fund. The nuclear waste management loan receivables formed by the amount loaned from the Finnish State
Nuclear Waste Management Fund, has been further loaned (with the same terms and conditions) to the equity
holders of the company and to Fortum Oyj. The loan from the Finnish State Nuclear Waste Management Fund
is unsecured between Teollisuuden Voima Oyj and the shareholders. The commercial terms of the loan is
12-month Euribor + 0.5 margin.
Trade and other receivables (current assets)
EUR 1,000 2022 2021
Trade receivables 9,975 10,183
Loan receivables 0 212
Prepayments and accrued income 16,045 46,894
Other receivables 207,058 204,545
Total 233,078 261,834
During the accounting period, TVO has, according to the GSA, recorded receivables for the additional compen-
sation from the Plant Supplier by the end of the accounting period. In connection with the agreement entering
into force in July 2021, the Plant Supplier paid EUR 206.9 million of the EUR 400.0 million delay compensation
as agreed in the GSA 2018. All payments related to compensation according to the settlement have been
recorded in the consolidated balance sheet as property, plant and equipment. At the end of the accounting
period the delay compensation from the Plant Supplier were EUR 193.1 million in the current receivables and
EUR 56.7 million in the non-current receivables. The prepayments and accrued income included in the year
2021 an estimate of EUR 24.2 million for the surplus of the Finnish State Nuclear Waste Management Fund,
which, after the amendment to the Nuclear Energy Act (269/2021), has been used to cover the protected
portion in accordance with Section 52 c of the Nuclear Energy Act.
The maximum credit loss risk of trade and other receivables corresponds to their book value. On 31 December
2022, the Group had EUR 167 (814) thousand overdue receivables of which EUR 0 (0) thousand was overdue
more than six months. The overdue receivables are not expected to cause the Group credit losses or impairments.
Offsetting financial assets and liabilities
2022
EUR 1,000 Gross amounts
Related amounts
not set off Net amount
Derivative financial assets 229,646 -40,584 189,062
Derivative financial liabilities -40,584 40,584 0
REPORT OF THE BOARD OF DIRECTORS AND FINANCIAL STATEMENTS 2022
53
REPORT OF THE BOARD OF DIRECTORS KEY FIGURES GROUP FINANCIAL STATEMENTS PARENT COMPANY FINANCIAL STATEMENTS FINANCIAL INFORMATION
18 Investments in shares
EUR 1,000 2022 2021
Share investments 1,935 1,935
Total 1,935 1,935
19 Inventories
EUR 1,000 2022 2021
Raw uranium and natural uranium
Replacement cost
159,407 133,705
Book value 92,740 99,268
Difference 66,667 34,437
Raw uranium and natural uranium 92,740 99,268
Nuclear fuel 169,684 166,681
Materials and supplies 9,954 8,540
Total 272,378 274,489
20 Derivative financial instruments
Nominal values of the derivative financial instruments
2022 Maturity structure
EUR 1,000 < 1 year 1–3 years 3–5 years 5–7 years > 7 years Total
Interest rate swaps 265,000 400,000 540,000 340,000 640,000 2,185,000
Forward foreign exchange contracts and swaps
1)
14,593 24,381 3,424 1,729 44,127
Cross-currency swaps 224,873 224,873
Total 279,593 649,254 543,424 341,729 640,000 2,454,000
2021 Maturity structure
EUR 1,000 < 1 year 1–3 years 3–5 years 5–7 years > 7 years Total
Interest rate swaps 359,117 265,000 400,000 220,000 700,000 1,944,117
Forward foreign exchange contracts and swaps
1)
27,594 24,598 13,958 3,447 69,597
Cross-currency swaps 153,678 224,900 378,577
Total 386,711 443,276 638,857 223,447 700,000 2,392,291
1)
 Forward contracts are mainly used for hedging fuel purchases against currency risk. The opposite forward contracts, which have been
acquired to adjust these hedging amounts, are netted in the table with each other, whereby the nominal describes the protected position.
Fair values of the derivative financial instruments
2022
EUR 1,000 Positive Negative Total
Interest rate swaps
Cash flow hedges
217,561 217,561
Fair value hedges -26,404 -26,404
Non-hedges
Forward foreign exchange contracts and swaps
Cash flow hedges
11,503 -431 11,072
Non-hedges 582 -173 409
Cross-currency swaps
Non-hedges
-13,576 -13,576
Total 229,646 -40,584 189,061
Material items under prepayments and accrued income
EUR 1,000 2022 2021
Accrued interest costs 20,538 20,069
Accrued insurance costs 2,511 2,265
Collateral received 4,690 2,160
Arrangement fee for loans -17,159 -16,456
Other prepaid expenses 5,465 38,856
Total 16,045 46,894
REPORT OF THE BOARD OF DIRECTORS AND FINANCIAL STATEMENTS 2022
54
REPORT OF THE BOARD OF DIRECTORS KEY FIGURES GROUP FINANCIAL STATEMENTS PARENT COMPANY FINANCIAL STATEMENTS FINANCIAL INFORMATION
The interest rate hedging in fair value hedge accounting
EUR 1,000 2022 2021
The book value of the derivative financial instruments, receivables -26,404 5,252
Nominal value 450,000 273,000
Due date 01/2023 - 03/2027 12/2022 - 02/2025
The book value of the hedged item, liabilities 476,585 273,000
The degree of hedging 1:1 1:1
The change of the basic value in valid hedging instruments since 1.1. -31,657 -5,457
The effectiveness of the hedge used to determine the change of value for the hedged item 32,002 5,621
The weighted average interest rate during the year 2.91% 1.51%
THE EFFECT OF HEDGE ACCOUNTING IN FINANCIAL POSITION AND RESULT
In fair value hedge accounting, the accumulated amount of the fair value adjustment of the loan is
EUR 26.6 (5.4) million.
The interest rate hedging in cash flow hedge accounting
EUR 1,000 2022 2021
The book value of the derivative financial instruments, liabilities 217,561 5,799
Nominal value 1,735,000 1,521,117
Due date 01/2023 - 09/2032 09/2022 - 02/2031
The degree of hedging 1:1 1:1
The change of the basic value in valid hedging instruments since 1.1. 211,762 39,448
The effectiveness of the hedge used to determine the change of value for the hedged item -211,931 -39,448
The weighted average interest rate during the year 3.18% 1.21%
The currency hedging in cash flow hedge accounting
EUR 1,000 2022 2021
The book value of the derivative financial instruments, receivables 11,503 11,111
The book value of the derivative financial instruments, liabilities -431 0
Nominal value 44,127 69,597
Due date 01/2023 - 01/2028 01/2022 - 01/2028
The degree of hedging 1:1 1:1
The change of the spot value in valid hedging instruments since 1.1. 3,092 5,516
The effectiveness of the hedge used to determine the change of value for the hedged item -3,092 -5,516
The weighted average of protected rate (inc. forward points) during the year (USD) 1.40 1.39
The weighted average of protected rate (inc. forward points) during the year (SEK) 10.41 10.20
The weighted average of protected rate (inc. forward points) during the year (GBP) 0.00 0.87
2021
EUR 1,000 Positive Negative Total
Interest rate swaps
Cash flow hedges
16,641 -10,842 5,799
Fair value hedges 5,252 5,252
Non-hedges -3,065 -3,065
Forward foreign exchange contracts and swaps
Cash flow hedges
11,111 11,111
Non-hedges 1,020 -95 925
Cross-currency swaps
Non-hedges
7,752 -7 7,745
Total 41,775 -14,008 27,767
REPORT OF THE BOARD OF DIRECTORS AND FINANCIAL STATEMENTS 2022
55
REPORT OF THE BOARD OF DIRECTORS KEY FIGURES GROUP FINANCIAL STATEMENTS PARENT COMPANY FINANCIAL STATEMENTS FINANCIAL INFORMATION
21 Equity
SHARE CAPITAL
The registered share capital of the Company according to the Articles of Association was EUR 600,365
thousand on 31 December 2022. TVO does not have a maximum or minimum limit for the share capital. The
number of the shares on 31 December 2022 was 1,360,000,000. The shares are divided into the two series
of shares as follows: A series 680,000,000 and B series 680,000,000. The shares have no nominal price as
is stipulated in the Finnish Limited Liability Companies Act.
According to the Articles of Association, TVO delivers electricity to its shareholders at cost price, i.e. it
delivers the electricity produced or procured to its shareholders in proportion to their shareholding in each
series. Each of the shareholders of each series is liable for the variable and fixed annual costs that are
specified in detail in the Articles of Association. The Company prepares annually a balance sheet divided
into series of shares. The balance sheet, which will be presented to the Shareholders’ Meeting, specifies the
assets, liabilities and equity of the different series of shares.
Share number reconciliations
EUR 1,000 Number of shares Share capital
Share premium reserve
and statutory reserve
31 Dec 2021 1,360,000,000 600,365 242,383
31 Dec 2022 1,360,000,000 600,365 242,383
Share number
31 Dec 2022 31 Dec 2021
A series 680,000,000 680,000,000
B series 680,000,000 680,000,000
Total 1,360,000,000 1,360,000,000
On 31 December 2022, the company has two registered share series: A and B.
SHARE PREMIUM RESERVE
The share premium reserve contains the share premiums of the share issues, EUR 232,435 thousand.
STATUTORY RESERVE
The statutory reserve consists of  EUR 9,948 thousand paid by Imatran Voima Oy, the predecessor of Fortum
Power and Heat Oy, in 1979 when it became an equity holder in the company.
FAIR VALUE AND OTHER RESERVES
Profits and losses incurred by fair value changes of available-for-sale investments and derivatives used as
cash flow hedges are entered in this reserve. The fair changes of derivatives are transferred to the profit/loss
statement when the cash flows they have been hedging have been realised.
SUBORDINATED SHAREHOLDER LOANS (HYBRID EQUITY)
The carrying value of the interest-bearing subordinated shareholder loans in the balance sheet 31 December
2022 was EUR 929,300 thousand. There is no maturity date for the subordinated shareholder loans (hybrid
equity), but the borrower is entitled to repay the loan in one or several installments. The Board of Directors
of the borrower has the right to decide not to pay interest during any current interest period. Unpaid interest
does not accumulate to the following interest periods.
Subordinated shareholder loans (hybrid equity) are unsecured and in a weaker preference position than
promissory notes. Holders of subordinated shareholder loans have no shareholder rights, nor does the bond
dilute the ownership of the Company’s shareholders.
RETAINED EARNINGS
This item contains the earnings from previous financial periods and the profit/loss of the financial year.
The interests of the subordinated shareholder loans (hybrid equity) is recorded to Retained earnings.
REPORT OF THE BOARD OF DIRECTORS AND FINANCIAL STATEMENTS 2022
56
REPORT OF THE BOARD OF DIRECTORS KEY FIGURES GROUP FINANCIAL STATEMENTS PARENT COMPANY FINANCIAL STATEMENTS FINANCIAL INFORMATION
22 Interest-bearing liabilities
EUR 1,000 2022 2021
Non-current interest-bearing liabilities
Loan from the Finnish State Nuclear Waste Management Fund
651,339 711,266
Bonds 3,254,801 2,811,264
Loans from financial institutions 1,212,014 962,461
Loans from others 17,350 56,117
Lease liabilities 47,099 47,350
Derivative financial instruments 40,040 10,740
Total 5,222,643 4,599,198
Current interest-bearing liabilities
Current portion of long-term bonds
205,595 306,675
Current portion of loans from financial institutions 50,608 44,698
Current portion of loans from others 0 3,386
Current portion of lease liabilities 2,467 2,060
Other interest-bearing liabilities 0 88,800
Derivative financial instruments 544 3,268
Total 259,214 448,887
Total 5,481,857 5,048,085
23 Trade payables and other current liabilities
EUR 1,000 2022 2021
Advances received 23,064 21,218
Trade payables 16,821 56,672
Accruals and deferred income and other liabilities 137,417 104,936
Total 177,302 182,826
TVO has on 31 December 2022 issued EUR-denominated Private Placement loans amounting to EUR 333.0
million and loans denominated in SEK, amounting to EUR 224.9 million. Foreign currency floating rate and
fixed rate loans are translated into EUR at the official exchange rate of the ECB on the balance sheet date.
The Private Placements have been swapped by using cross-currency swaps. In 2022, the effect of foreign
exchange hedges was negative amounting to EUR 21.3 million and correspondingly, the effect of foreign
currency denominated loans was positive amounting to EUR 21.3 million.
Accruals and deferred income and other liabilities are allocated as follows:
EUR 1,000 2022 2021
Finnish State Nuclear Waste Management Fund 40,227 13,312
Accrued interests 50,316 40,481
Accrued personnel expenses 22,778 23,830
Accruals related to CO
2
 emission rights 129 159
Others 23,967 27,154
Total 137,417 104,936
REPORT OF THE BOARD OF DIRECTORS AND FINANCIAL STATEMENTS 2022
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REPORT OF THE BOARD OF DIRECTORS KEY FIGURES GROUP FINANCIAL STATEMENTS PARENT COMPANY FINANCIAL STATEMENTS FINANCIAL INFORMATION
24 Assets and provision related to nuclear waste management obligation
SHARE IN THE FINNISH STATE NUCLEAR WASTE MANAGEMENT FUND
Under the Nuclear Energy Act in Finland, TVO has a legal obligation to fully fund the legal liability for nuclear
waste including the decommissioning of the power plant through the Finnish State Nuclear Waste Manage
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ment Fund (=nuclear waste management obligation).
TVO contributes funds to the Finnish State Nuclear Waste Management Fund to cover future obligations
based on the legal liability calculated according to the Nuclear Energy Act. The carrying value of the fund in
TVO’s balance sheet is calculated according to the interpretation in IFRIC 5 “Rights to Interests arising from
Decommissioning, Restoration and Environmental Rehabilitation Funds.
PROVISION RELATED TO THE NUCLEAR WASTE MANAGEMENT OBLIGATION
The provision is related to future obligations for the decommissioning of the power plant, management of
spent fuel and operating waste. The fair value of the provision is calculated according to IAS 37 based on
discounted future cash flows which are based on estimated future expenses. The cost estimate is based on
a nuclear waste management plan covering the management of spent nuclear fuel and operating waste and
decommissioning of the nuclear power plant. The new total cost estimate based on a new nuclear waste
management technical plan and schedule is updated every third year. The technical plans, timing and cost
estimates are approved by governmental authorities.
The total cost estimate based on a new nuclear waste management technical plan and schedule was updated
in June 2022. The present initial value of the provision for the decommissioning of a nuclear power plant (at
the time of commissioning the nuclear power plant) has been capitalised as property, plant and equipment
and will be adjusted later for possible changes in the plan. The costs for spent fuel disposal are expensed
based on fuel usage during the operating time of the plant. The impact of any changes to the plans and
schedules will be recognised immediately in the income statement based on fuel used by the end of each
accounting period.
The updated cost estimate decreased the book value of property, plant and equipment related to decommis
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sioning by EUR 71.8 million and also decreased the provision related to nuclear waste management by EUR
81.5 million compared with the value at the end of the previous year. The biggest changes due to the updated
cost estimate in the income statement of the TVO Group are the increased expenses of EUR 15.7 million in
materials and services. The overall effect on profit for the period is negative because the amount of the share
in the Finnish State Nuclear Waste Management Fund and the provision related to nuclear waste manage
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ment are equal and the difference is entered as an adjustment to materials and services, as the Nuclear Waste
Management Fund is overfunded from an IFRS perspective. The negative profit impact of the updates and
changes was mainly non-recurring.
At the end of the year, the balance sheet contains the following assets and liabilities
concerning the nuclear waste management obligation:
EUR 1,000 2022 2021
The carrying value of TVO's share in the Finnish State Nuclear Waste Management Fund (non-current assets) 999,662 1,010,071
Provision related to nuclear waste management (non-current liabilities)
Beginning of the year
1,368,291 1,029,522
Increase/decrease in provision -37,388 366,354
Used provision -84,307 -65,295
Changes due to discounting 47,749 37,710
End of the year 1,294,345 1,368,291
The discount rate % 4.0 4.0
TVO’s legal liability as stated in the Nuclear Energy Act and the Company’s share
in the Finnish State Nuclear Waste Management Fund
EUR 1,000 2022 2021
Liability for nuclear waste management according to the Nuclear Energy Act 1,839,600 1,816,100
TVO's funding target obligation 2023 (2022) to the Finnish State Nuclear Waste Management Fund 1,457,900 1,436,100
TVO's share in the Finnish State Nuclear Waste Management Fund 31.12.2022 (31.12.2021) 1,436,100 1,450,600
Difference between the liability and TVO's share of the fund 31.12.2022 (31.12.2021) 403,500 365,500
The OL3 plant unit’s nuclear waste liability calculation according to IAS 37 started and a provision was recorded in
the balance when the plant unit was made critical on 21 December 2021. The OL1/OL2 plant units’ and the OL3
plant unit’s liabilities and shares in the Fund are calculated and recorded separately, as the corresponding total
cost estimates are prepared separately for the plant units. The legal liability calculated according to the Nuclear
Energy Act in Finland and decided by the supervising authority (Ministry of Economic Affairs and Employment)
is EUR 1,839.6 (1,816.1) million on 31 December 2022 (31 December 2021), of which EUR 1,437.8 (1,426.4)
million belongs to OL1/OL2 and EUR 401.8 (389.7) million belongs to OL3. The carrying value of the liability in the
balance sheet calculated according to IAS 37 is EUR 1,294.3 (1,368.3) million on 31 December 2022. The main
reason for the difference between the carrying value of the provision and the legal liability is the fact that the legal
liability is not discounted to net present value. Since the future cash flow is spread over 100 years, the difference
between non-discounted legal liability and the discounted provisions is remarkable. The change in the discount
rate has an effect on the provision. The provision increases when the discount rate used is lowered.
REPORT OF THE BOARD OF DIRECTORS AND FINANCIAL STATEMENTS 2022
58
REPORT OF THE BOARD OF DIRECTORS KEY FIGURES GROUP FINANCIAL STATEMENTS PARENT COMPANY FINANCIAL STATEMENTS FINANCIAL INFORMATION
According to Section 40 Clause 1 of the Nuclear Energy Act, the Fund target for each calendar year shall be
equal to the liability of the previous calendar year. In order to balance the effects of nuclear waste management
costs on several operating years of the nuclear plant, the Fund target is however lower than the liability, while
the preconditions stipulated in Section 40 are fulfilled. Time-based periodisation (40 years) is used to calculate
the OL3 plant unit’s Fund target, according to Section 40 Clause 2 of the Nuclear Energy Act and the Govern
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ment Decree (991/2017) Section 5.
TVO’s share in the Finnish State Nuclear Waste Management Fund is EUR 1,436.1 (1,450.6) million on 31
December 2022. The carrying value of the TVO’s share in the Fund in the balance sheet is EUR 999.7 (1 010.1)
million. The difference is due to the fact that IFRIC 5 limits the carrying amount of TVO’s share in the Finnish
State Nuclear Waste Management Fund to the amount of the related liability since TVO does not have control
over the Finnish State Nuclear Waste Management Fund. As long as the Fund is overfunded from an IFRS
perspective, the effects to operating profit from this adjustment will be positive if the provision increases more
than the Fund, and negative if the actual value of the Fund increases more than the provision. On 31 December
2022 the OL1/OL2 plant units’ share in the Fund is higher than the provision according to IFRS, due to which the
above-mentioned adjustment is recorded for the OL1/OL2 plant units’ nuclear waste management IFRS calcu
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lation. The OL3 plant unit’s share in the Fund is in turn lower than the provision according to IFRS, and therefore
the above-mentioned adjustment is not recorded.
The difference between the funding target and the share in the Finnish State Nuclear Waste Management Fund
at the end of each year is due to the funding target being completed by paying the nuclear waste management
fee only during the first quarter of the following year. The surplus will not be refunded from the Nuclear Waste
Management Fund to TVO in respect of 2021 after the amendment to the Nuclear Energy Act (269/2021), even
though the funding target of TVO is lower in 2022 than the share in the Fund in 2021. The refund for 2021, EUR
14.5 million, was used to cover the protected portion in accordance with the Nuclear Energy Act Section 52 c.
In accordance with the implementing provision of the law amendment, the profitable result of the Finnish State
Nuclear Waste Management Fund for 2021 was not used to refund TVO’s nuclear waste management fee, but
it was also used to cover the protected portion. In order to supplement the legal protected portion, TVO provided
the Nuclear Waste Management Fund with a separate cash security of EUR 7.4 million in addition to the surplus
and profit. In 2022, the Nuclear Waste Management Fund started investment activities in accordance with new
legislation. The Nuclear Waste Management Fund made a loss, which raised TVO’s nuclear waste management
fee for 2022, as well as required the Company to provide additional securities to cover the legal protected
portion. The nuclear waste management fee for 2022 will be confirmed in March 2023.
TVO has issued to the State the shareholdersabsolute guarantees as security for the unfunded legal liability.
The security also covers unexpected events as determined in the Nuclear Energy Act. The guarantees are
included in the nuclear waste management obligations, see Note 25 Obligations and other commitments.
Pledged promissory notes and financial guarantees
EUR 1,000 2022 2021
Pledged promissory notes to the Finnish State Nuclear Waste Management Fund 651,339 711,266
Guarantees given by shareholders related to the nuclear waste management obligation 534,990 480,670
25 Obligations and other commitments
As a result of the amendment to the Nuclear Energy Act which entered into force in May 2021, a company liable
for nuclear waste management or its shareholder is entitled to borrow back a maximum of 60 percent of its
share in the Nuclear Waste Management Fund as of 2022. Before the amendment to the Nuclear Energy Act the
company under the nuclear waste management obligation was entitled to borrow an amount equal to 75 percent
of its share in the Finnish State Nuclear Waste Management Fund. TVO has lent the funds borrowed from the
fund to its shareholders and has pledged the receivables from the shareholders as collateral for the loan.
The absolute guarantees given by the equity holders of the Company are given to cover the unfunded portion
of the nuclear waste management obligation and unexpected events as determined in the Nuclear Energy
Act. According to Section 44 of the Nuclear Energy Act, a party with a waste management obligation shall
supply the State with collateral security fulfilling the conditions provided in Section 45 before commencing
waste-generating operations and otherwise always by the end of June so that the total of collateral equals the
difference between the liabilities for the calendar year and the Fund target. At the start of the OL3 plant unit’s
operations, the Ministry of Economic Affairs and Employment has approved TVO’s equity holders’ absolute
guarantees as collateral security supplied to the State.
Commitments
Contingent liabilities given on own behalf
EUR 1,000 2022 2021
Bank guarantees 550 550
Finnish participants in the State Nuclear Waste Management Fund are allowed to borrow from the Fund
according to defined rules. TVO utilises the right to borrow funds back and has pledged the receivables from
the shareholders as security for the loans. The loans are renewed annually. The loans are included in the inter
-
est-bearing liabilities, see Note 22 Interest-bearing liabilities.
REPORT OF THE BOARD OF DIRECTORS AND FINANCIAL STATEMENTS 2022
59
REPORT OF THE BOARD OF DIRECTORS KEY FIGURES GROUP FINANCIAL STATEMENTS PARENT COMPANY FINANCIAL STATEMENTS FINANCIAL INFORMATION
t CO
2
2022
EUR 1,000 t CO
2
2021
EUR 1,000
Total annual emissions from production facilities 1,449 2,435
Possessed emission rights 1,604 2,740
Emission rights bought
1)
1,300 110 2,500 151
1)
 The purchases of the emission rights are included in materials and services.
The emission rights that TVO possesses on 31 December are included in intangible assets on the balance sheet.
26 Related party
The Group’s related parties include parent company Teollisuuden Voima Oyj and its subsidiary and joint
ventures. The related parties also include the Board of Directors and the Executive Management, including the
President and CEO.
Group’s parent company and subsidiaries
Company Home country Ownership, %
Share in
voting rights, %
Teollisuuden Voima Oyj Finland
TVO Nuclear Services Oy Finland 100 100
Transactions with related parties are as follows
2022
EUR 1,000 Sales Purchases Receivables Liabilities
Posiva Group 11,324 82,337 6,212 3,031
2021
EUR 1,000 Sales Purchases Receivables Liabilities
Posiva Group 11,835 87,865 5,144 1,018
PENDING COURT CASES AND DISPUTES
In August 2022, the arbitral tribunal resolved all the claims presented to each other by TVO and Wärtsilä
Finland Oy concerning the delivery schedules, additional costs, and delay liquidated damages of the diesel
generators at the Olkiluoto nuclear power plant. Therefore, at the end of the accounting period 2022, TVO has
no pending court cases or disputes.
CO
2
EMISSION RIGHTS
TVO’s CO
2
 emissions are generated by the releases of the reserve boilers and the emergency diesel gener-
ators. In principle TVO has, on 31 December, emission rights at least the same amount as the actual annual
emissions are. If the actual emissions exceed the amount of the emission rights that TVO possesses, TVO has
booked the expense for exceeding emission rights at the market value on 31 December.
Investment commitments
Agreement-based commitments regarding the acquisition of property, plant and equipment:
EUR 1,000 2022 2021
OL1 and OL2 101,100 84,700
OL3 354,300 401,500
Total 455,400 486,200
Transactions with related parties are as follows
2022
EUR 1,000 Sales Purchases Receivables Liabilities
PVO, Fortum Oyj, Fortum Power and Heat Oy 294,875 32,268 589,844 808,792
2021
EUR 1,000 Sales Purchases Receivables Liabilities
PVO, Fortum Oyj, Fortum Power and Heat Oy 245,011 27,421 649,847 824,403
TEOLLISUUDEN VOIMA OYJ’S SHAREHOLDERS
Related parties according to the IAS 24 standard are also two of TVO’s biggest shareholders, Pohjolan Voima
Oyj (PVO) and Fortum Power and Heat Oy (FPH), which have significant authority, as well as PVO’s biggest
owner UPM-Kymmene Oyj (UPM) and FPH’s owner Fortum Oyj.
REPORT OF THE BOARD OF DIRECTORS AND FINANCIAL STATEMENTS 2022
60
REPORT OF THE BOARD OF DIRECTORS KEY FIGURES GROUP FINANCIAL STATEMENTS PARENT COMPANY FINANCIAL STATEMENTS FINANCIAL INFORMATION
Senior management’s employee benefits
The senior management of TVO comprises the Board of Directors and the Executive Management, including
the President and CEO. The Group has no business transactions with senior management.
27 Financial risk management
Financing and financial risks are centrally managed by the finance operations of the TVO Group in accordance
with the Finance Policy approved by the Board of Directors. Compliance with the Finance Policy is monitored
by the Board of Directors and the Company’s management. The SVP, Treasury is responsible for financing
operations. The TVO Group is exposed to a variety of financial risks: liquidity, market and credit risk. These do
not include the receivables and obligations between the Company and its owners, as the Company operates
at cost price (see Note 1 General information on the Group).
The TVO Groups guiding financial principles are to ensure access to adequate liquidity reserves and, secondly,
to reduce volatility in cash flows deriving form short and medium-term fluctuations in the financial markets.
In accordance with the Finance Policy of the Company, derivative instruments are entered into only with
hedging purposes and they should qualify for hedge accounting under IFRS.
LIQUIDITY RISK
Liquidity and refinancing risk is defined as the amount by which earnings and cash flows are affected as a
result of the Company not being able to secure sufficient financing. In addition to sufficient liquid assets and
committed credit lines, the TVO Group aims to diminish the refinancing risk by spreading the maturity dates of
its loans and different financing sources as much as possible.
In accordance with the Finance Policy of the TVO Group, the maturities and refinancing of long-term loans are
planned so that no more than 25 percent of the outstanding loans mature during the next rolling 12-month
period. The loans borrowed from the Finnish State Nuclear Waste Management Fund, which have been lent
further to the shareholders, form an exception.
The TVO Group issues commercial papers under the Commercial Paper Program for short-term funding
purposes. There shall always exist committed credit lines with a minimum duration of 12 months for an
amount corresponding to the funding needs of the Company for the following 12 months.
In addition to long-term committed credit lines, the Company shall maintain liquid assets at an amount stated
in the Finance Policy. In accordance with the Finance Policy, bank deposits, certificates of deposits, commercial
papers, municipal papers, and treasury notes as well as money market funds are accepted as investments, and
they are mostly for short-term purposes with a maximum duration of 12 months.
The employee benefits of the Executive Management and CEO
EUR 1,000 2022 2021
Salary and other short-term employee benefits of the CEO 352 356
Salary and other short-term employee benefits of the Executive Management other than
the CEO
1,670 1,673
Statutory pension contributions of the Executive Management other than the CEO 274 261
Supplementary pensions of the Executive Management other than the CEO 151 144
Total 2,447 2,434
Compensation to the Board of Directors
EUR 1,000 2022 2021
Board of Directors on 31 December 2022
Tiina Tuomela 49 48
Ilkka Tykkyläinen 46 51
Hannu Jokinen, from 31 March 2021 36 29
Esa Kaikkonen 35 39
Tapio Korpeinen 40 42
Petra Lundström, from 31 March 2021 31 23
Anders Renvall 31 32
Rami Vuola 36 39
Juha-Pekka Weckström 36 38
Former Board members
Risto Andsten, until
31 March 2021 0 9
Markus Rauramo, until 31 March 2021 0 10
Total 340 360
REPORT OF THE BOARD OF DIRECTORS AND FINANCIAL STATEMENTS 2022
61
REPORT OF THE BOARD OF DIRECTORS KEY FIGURES GROUP FINANCIAL STATEMENTS PARENT COMPANY FINANCIAL STATEMENTS FINANCIAL INFORMATION
Undiscounted cash flows of financial liabilities
2021
EUR 1,000 2022 2023 2024 2025 2026– Total
Loans from financial institutions
1)
48,258 50,608 426,104 426,104 64,026 1,015,100
Financing costs
2)
7,313 4,344 4,038 488 775 16,958
Loan from the Finnish State Nuclear
Waste Management Fund
3)
711,266 711,266
Financing costs 3,612 3,556 3,556 3,556 3,841 18,122
Bonds
4)
250,561 311,777 644,900 500,000 1,413,000 3,120,238
Financing costs 55,975 52,545 43,046 32,223 59,198 242,987
Loans from others
4)
56,117 56,117
Financing costs 577 577
Lease liabilities 2,060 1,948 1,848 43,552 1 49,410
Commercial papers 85,240 85,240
Other liabilities 107,815 107,815
Interest rate derivatives 11,211 8,234 7,618 8,089 22,536 57,687
Total 572,623 489,128 1,131,111 1,014,012 2,274,642 5,481,516
Forward foreign exchange contracts 72 14 2 1 0 89
1)
 Repayments in 2022 are included in current liabilities in the balance sheet.
2)
 In addition to interest costs, financing costs include commitment fees.
3)
 The loan is renewed yearly and connected interest payments are calculated for five years.
4)
 The placements in foreign currency have been swapped into EUR-floating or fixed cash flow using cross-currency swaps.
The cash flows from shareholder loans consist of interest payments, which for 2023 are an estimated
EUR 29.2 million.
Undiscounted cash flows of financial liabilities
2022
EUR 1,000 2023 2024 2025 2026 2027– Total
Loans from financial institutions
1)
50,608 426,104 626,104 126,104 55,272 1,284,191
Financing costs
2)
39,342 36,354 24,490 2,001 3,464 105,650
Loan from the Finnish State Nuclear
Waste Management Fund
3)
651,339 651,339
Financing costs 3,377 25,318 24,761 23,474 22,705 99,634
Bonds
4)
205,665 644,900 500,000 650,000 1,513,000 3,513,565
Financing costs 71,881 65,186 54,345 43,755 90,012 325,180
Loans from others
4)
Financing costs
Lease liabilities
2,432 2,314 44,009 406 406 49,566
Commercial papers
Other liabilities
63,695 63,695
Interest rate derivatives 29,455 32,780 26,900 26,895 68,969 184,998
Total 466,454 1,232,956 1,300,607 872,634 2,405,168 6,277,819
Forward foreign exchange contracts 543 31 30 1 0 604
1)
 Repayments in 2023 are included in current liabilities in the balance sheet.
2)
In addition to interest costs, financing costs include commitment fees.
3)
 The loan is renewed yearly and connected interest payments are calculated for five years.
4)
 The placements in foreign currency have been swapped into EUR-floating or fixed cash flow using cross-currency swaps.
REPORT OF THE BOARD OF DIRECTORS AND FINANCIAL STATEMENTS 2022
62
REPORT OF THE BOARD OF DIRECTORS KEY FIGURES GROUP FINANCIAL STATEMENTS PARENT COMPANY FINANCIAL STATEMENTS FINANCIAL INFORMATION
Expected cash flows from financial instruments under cash flow hedge accounting
2022
EUR 1,000 2023 2024 2025 2026 2027– Total
Interest rate swaps
Cash flows
25,216 26,802 24,081 24,294 70,865 171,258
2021
EUR 1,000 2022 2023 2024 2025 2026– Total
Interest rate swaps
Cash flows
-9,604 -6,610 -6,002 -5,810 -22,536 -50,561
Sensitivity to market risks
Sensitivity to market risks arising from financial instruments as required by IFRS 7.
EUR 1,000 Income statement
2022
Equity Income statement
2021
Equity
+ 10% change in EUR/USD exchange rates -4,217 -6,664
+ 10% change in EUR/SEK exchange rates -196 -215
+ 10% change in EUR/GBP exchange rates 0 -81
- 10% change in EUR/USD exchange rates 4,217 6,664
- 10% change in EUR/SEK exchange rates 196 215
- 10% change in EUR/GBP exchange rates 0 81
1% upward parallel shift in interest rates -10,993 58,179 -12,144 72,288
1% downward parallel shift in interest rates 10,993 -69,796 12,144 -67,934
Assumptions:
The change in EUR/USD, EUR/SEK and EUR/GBP exchange rates are assumed to be +/- 10 percent.
The currency position includes the forward foreign exchange contracts which are designated as cash flow
hedges and recognised in equity and the forward foreign exchange contracts not qualified as cash flow
hedges, affecting the income statement.
The variation in interest rates is assumed to be a 1 percentage point parallel shift in the interest rate curve.
The calculation takes into account the derivatives in the cash flow hedging calculation. The comparison figure
for 2021 is presented according to the same calculation method.
The interest rate risk position includes the floating rate loan receivables, interest-bearing borrowing, the
interest rate derivatives and cash equivalents.
The income statement is affected by the interest-bearing loan receivables, floating rate borrowings and the
interest rate derivatives, excluding those interest rate derivatives that are designated as and qualifying for
cash hedges, which are recognised in equity. The gain or loss is recognised in profit or loss, except when they
relate to the construction of OL3 and are capitalised in the balance sheet.
MARKET RISK
Currency risk
TVO Group is exposed to currency risk mainly in connection with its fuel purchases. The currency of
purchases of raw uranium and enrichment is frequently USD. Hedging of a currency denominated purchase
is commenced when an agreement is entered into and the forecasted currency risk becomes highly probable.
Both short-term and long-term loans are withdrawn mainly in euros. The loans denominated in other curren
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cies than euros are hedged latest at the withdrawal date.
Currency swaps, forward contracts, and options can be used to hedge the currency exposure.
Interest rate risk
Interest-bearing liabilities expose the Company to interest rate risk. The objective of the Company’s interest
rate risk management is to maintain the interest costs at as low a level as possible and to diminish the vola
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tility of interest costs. In accordance with the Finance Policy, the duration of the loan portfolio of the Company
can vary between 36 and 48 months. At the closing date the duration was 42 months.
The average interest rate duration is managed with fixed interest rate loans, interest rate swaps, forward rate
agreements as well as with interest rate caps and floors.
The average interest rate on loans and derivatives on 31 December 2022 was 2.09 % (2021: 1.52 %).
Borrowings issued at variable rates expose the TVO Group to cash flow interest rate risk. Borrowings
issued at fixed rates expose the TVO Group to fair value interest rate risk. The TVO Group shall apply hedge
accounting as far as practical. Based on the various scenarios, the TVO Group manages its cash flow interest
rate risk by using floating-to-fixed interest rate swaps. Such interest rate swaps have the economic effect
of converting borrowings from floating rates to fixed rates. The TVO Group also enters into fixed-to-floating
interest rate swaps to hedge the fair value interest rate risk.
REPORT OF THE BOARD OF DIRECTORS AND FINANCIAL STATEMENTS 2022
63
REPORT OF THE BOARD OF DIRECTORS KEY FIGURES GROUP FINANCIAL STATEMENTS PARENT COMPANY FINANCIAL STATEMENTS FINANCIAL INFORMATION
Euro Medium Term Note Programme EUR 5,000,000,000
EUR 1,000
Currency Nominal amount
2022
Carrying amount Nominal amount
2021
Carrying amount Interest rate % Maturity date
EUR 30,000 29,999 3.88 9.5.2022
EUR 100,000 99,989 Euribor 6M + 1.58 12.9.2022
EUR 23,000 23,000 4.08 1.12.2022
EUR 20,000 19,991 20,000 19,984 2.80 8.5.2024
EUR 75,000 74,710 75,000 74,652 3.60 14.12.2027
EUR 23,000 22,934 23,000 23,741 3.50 3.5.2030
EUR 45,000 44,884 45,000 44,872 3.90 31.3.2032
EUR 20,000 19,846 20,000 19,830 3.88 8.11.2032
EUR 500,000 490,943 500,000 502,397 2.13 4.2.2025
EUR 205,665 205,577 311,777 311,695 2.63 13.1.2023
EUR 400,000 398,851 400,000 398,001 2.00 8.5.2024
EUR 650,000 647,394 650,000 646,577 1.13 9.3.2026
EUR 600,000 597,047 600,000 596,508 1.38 23.6.2028
EUR 600,000 577,393 2.63 31.3.2027
EUR 150,000 149,636 4.19 13.9.2032
SEK 1,000,000 97,555 Stibor 3M + 1.17 15.2.2022
SEK 500,000 44,957 500,000 48,779 Stibor 3M + 1.78 15.2.2024
SEK 850,000 76,390 850,000 82,805 2.38 15.2.2024
SEK 500,000 44,957 500,000 48,779 Stibor 3M + 1.42 29.10.2024
SEK 500,000 44,957 500,000 48,779 1.56 29.10.2024
Total 3,460,466 3,117,942
TVO Group debt structure by maturity
31 December 2022
EUR 1,000 2023 2024 2025 2026 2027 2028 2029 2030 2031– Total
Loans from financial
institutions
50,608 426,104 626,104 126,104 26,104 11,818 17,350 1,284,192
Bonds 205,665 644,900 500,000 650,000 675,000 600,000 23,000 215,000 3,513,565
Loans from others
Lease liabilities
2,432 2,314 44,009 406 406 49,566
Commercial papers
Total
258,705 1,073,318 1,170,113 776,510 701,510 611,818 40,350 215,000 4,847,323
TVO Group credit commitment by maturity
31 December 2022
EUR 1,000 2023 2024 2025 2026 2027 2028 2029 2030 2031– Total
Syndicated
revolving credit
facility
1,000,000 1,000,000
Bilateral revolving
credit facility
Bilateral bank loan
Total
1,000,000 1,000,000
On 31 December 2022, the Group had undrawn credit facilities amounting to EUR 1,000 million (2021: EUR
1,000 million). In addition, the Group had subordinated shareholder loan (hybrid equity) commitments totalling
EUR 400 million (2021: EUR 400 million) and cash and cash equivalents amounting to EUR 353 million (2021:
EUR 172 million).
BONDS
REPORT OF THE BOARD OF DIRECTORS AND FINANCIAL STATEMENTS 2022
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REPORT OF THE BOARD OF DIRECTORS KEY FIGURES GROUP FINANCIAL STATEMENTS PARENT COMPANY FINANCIAL STATEMENTS FINANCIAL INFORMATION
The equity ratio monitored by the TVO Group’s management
EUR 1,000 2022 2021
Equity ratio, % (IFRS, Group)
1)
30.7 31.3
Equity ratio, % (Parent company)
2)
28.4 30.8
1)
 Equity ratio % = 100 x equity + loans from equity holders of the company
balance sheet total - provision related to nuclear waste management - loan from the Finnish State Nuclear Waste
Management Fund
2)
 Equity ratio % = 100 x equity + appropriations + loans from equity holders of the company
balance sheet total - loan from the Finnish State Nuclear Waste Management Fund
Net debt reconciliation
EUR 1,000 2022 2021
Cash and cash equivalents 353,203 172,318
Liabilities 5,391,707 4,984,667
Leases 49,566 49,410
Net debt 5,088,070 4,861,759
Liabilities from financing activities Other assets
EUR 1,000 Liabilities Leases Sub-total
Cash and cash
equivalents Total
Net debt 1 Jan 2021 -4,904,449 -51,477 -4,955,926 161,363 -4,794,563
Cash flows -91,537 2,117 -89,420 10,955 -78,465
Acquisitions - leases 0 -251 -251 0 -251
Other non-cash flow expenses 11,319 201 11,520 0 11,520
Net debt 31 Dec 2021 -4,984,667 -49,410 -5,034,077 172,318 -4,861,759
Cash flows -461,135 2,409 -458,726 180,885 -277,841
Acquisitions - leases 0 -2,565 -2,565 0 -2,565
Other non-cash flow expenses 54,095 0 54,095 0 54,095
Net debt 31 Dec 2022 -5,391,707 -49,566 -5,441,273 353,203 -5,088,070
The loan from the Finnish State Nuclear Waste Management Fund has been added in the table. The figures of
the year of comparison 2021 have also been changed to be similar to the new presentation model.
1)
 Other changes include non-cash movements, including fair value changes of derivative financial instruments and the
arrangement fee for loans, which will be presented as operating cash flows in the statement of cash flow when paid.
CREDIT RISK
Credit risk arises from the potential failure of a counterparty to meet its contractual payment obligations.
Commercial trade receivables as well as receivables from financial institutions relating to investments, deposits
and derivative transactions expose the Company to credit risk. In addition to money market funds, financial
institutions that meet the credit rating requirements of the Group´s Financial Policy are accepted as coun
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terparties. Furthermore, the TVO Group has in place a master agreement (ISDA) with all derivative contract
counterparties.
The loan of the Finnish State Nuclear Waste Management Fund has been further loaned with the same loan
terms to the company’s shareholders; however, so that Fortum Power and Heat Oy´s share is loaned to
Fortum Oyj. The loans do not have separate collateral. The nuclear waste management receivables and loans
are valued at amortised cost. The management has evaluated the on-lending agreements and the creditwor
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thiness of the parties to be sufficient for these loans and thus the expected credit losses of the loan receiva-
bles are immaterial and do not include a significant credit risk.
FUEL PRICE RISK
The fuel used for electricity production by the Group is uranium.
The TVO Group purchases the uranium fuel from the global markets. The purchasing process consists of four
stages: purchase of uranium concentrate, conversion, enrichment and fuel fabrication. Purchasing Policy is
used to guarantee the availability of fuel and to minimise price risk. This includes storage strategy and diversi
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fied long-term purchasing agreements with different suppliers.
The TVO Group has not used commodity derivatives to hedge fuel price risk.
CAPITAL RISK MANAGEMENT
The TVO Groups objective is to secure sufficient equity and equity-like funding that guarantees diversified
funding sources.
The equity ratio of the Company varies along investment cycles. The Group aims to have a minimum equity
ratio (IFRS) of 25 percent in the long-term. When calculating the equity ratio, the loan from the Finnish State
Nuclear Waste Management Fund (lent further to the shareholders) and the provision related to nuclear waste
management obligation are excluded. Additionally, subordinated loans or equivalent loans from the share
-
holders are regarded as equity.
According to the terms of some loan agreements, the Company is committed to maintain the consolidated
equity ratio of TVO Group (IFRS) equal to or greater than 25 percent. There are no other key ratio-related
covenants in the loan agreements.
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REPORT OF THE BOARD OF DIRECTORS KEY FIGURES GROUP FINANCIAL STATEMENTS PARENT COMPANY FINANCIAL STATEMENTS FINANCIAL INFORMATION
28 Events after the balance sheet date
After tests at full reactor capacity, the OL3 plant unit’s production was interrupted according to plan in
January 2023 in order to replace the impellers of the feedwater pumps. Thereafter, before the start of regular
electricity production, an approximately month-long production phase will still follow in the test production,
where OL3 will produce electricity at mostly full power 24/7. Regular electricity production starts in March
2023.
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REPORT OF THE BOARD OF DIRECTORS KEY FIGURES GROUP FINANCIAL STATEMENTS PARENT COMPANY FINANCIAL STATEMENTS FINANCIAL INFORMATION
Income statement
EUR 1,000 Note 1 Jan-31 Dec 2022 1 Jan-31 Dec 2021
Turnover 2 353,479 293,781
Work performed for own purpose 3 21,310 25,036
Other income 4 17,047 16,434
Materials and services 5 -183,929 -115,198
Personnel expenses 6 -80,139 -81,961
Depreciation and impairment charges 7 -40,690 -37,650
Other expenses 8 -101,203 -104,509
 -14,125 -4,067
Financial income and expenses 9 3,823 -8
 -10,302 -4,075
Appropriations 10 12,511 4,075
 2,209 0

REPORT OF THE BOARD OF DIRECTORS AND FINANCIAL STATEMENTS 2022
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REPORT OF THE BOARD OF DIRECTORS KEY FIGURES GROUP FINANCIAL STATEMENTS PARENT COMPANY FINANCIAL STATEMENTS FINANCIAL INFORMATION
Balance sheet
EUR 1,000 Note 31 Dec 2022 31 Dec 2021


Intangible assets
11 2,476 2,543
Tangible assets 11 6,007,324 5,709,057
Investments
Holdings in group companies
12 8 8
Holdings in joint ventures 12 1,011 1,011
Other shares 12 4,219 4,219
Other receivables 12 710,964 716,202 714,028 719,266
 6,726,002 6,430,866

Inventories
13 272,283 274,421
Current receivables 14 250,876 278,208
Cash and cash equivalents 352,359 172,134
 875,518 724,763
 7,601,520 7,155,629
EUR 1,000 Note 31 Dec 2022 31 Dec 2021


Share capital
15 600,365 600,365
Share premium reserve 15 232,435 232,435
Statutory reserve 15 9,948 9,948
Retained earnings (loss) 15,16 18,730 18,730
 15,16 2,209 0
 863,687 861,478
 181,207 193,326

Non-current liabilities
17,18 4,541,483 3,836,518
Shareholders' loans 17 929,300 929,300
Loan from the Finnish State Nuclear Waste Management
Fund
17 651,339 711,266
Current liabilities 19 434,504 623,741
 6,556,626 6,100,825
 7,601,520 7,155,629
REPORT OF THE BOARD OF DIRECTORS AND FINANCIAL STATEMENTS 2022
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REPORT OF THE BOARD OF DIRECTORS KEY FIGURES GROUP FINANCIAL STATEMENTS PARENT COMPANY FINANCIAL STATEMENTS FINANCIAL INFORMATION

EUR 1,000 2022 2021


-14,125 -4,067

1)
40,690 37,650
Changes in working capital
2)
61,608 -4,257
 -4,337 -4,114
Dividend received 2,209 0
Interest received 6,277 3,977
 92,322 29,189

Acquisition of shares
0 -1
Acquisition of non-current assets -433,656 -322,051
OL3 project compensation 0 206,875
Loan receivables granted -15,831 -105
Repayments of loans granted 75,837 5,392
 -373,650 -109,889

Withdrawals of long-term loans
1,050,000 800,000
Repayment of long-term loans -517,415 -571,683
Increase (+) or decrease (-) in short-term interest-bearing liabilities 62,740 61,630
Repayment of short-term interest-bearing liabilities -134,190 -198,410
Group contribution received 418 343
 461,553 91,880
EUR 1,000 2022 2021
 180,225 11,180
Cash and cash equivalents 1 Jan 172,134 160,954
31 352,359 172,134
1)

Depreciation and write-downs
40,690 37,650
 40,690 37,650
2)
Changes in working capital
Increase (-) or decrease (+) in inventories
2,137 -376
Increase (-) or decrease (+) in non-interest-bearing receivables 27,535 -17,617
Increase (+) or decrease (-) in short-term non-interest-bearing liabilities 31,936 13,736
 61,608 -4,257
REPORT OF THE BOARD OF DIRECTORS AND FINANCIAL STATEMENTS 2022
69
REPORT OF THE BOARD OF DIRECTORS KEY FIGURES GROUP FINANCIAL STATEMENTS PARENT COMPANY FINANCIAL STATEMENTS FINANCIAL INFORMATION

1 Accounting principles
VALUATION PRINCIPLES
Non-current assets and their depreciation
Non-current assets have been capitalised in the
direct acquisition cost less grants received, accu
-
mulated depreciation and impairment charges, and
compensation, if any. Depreciation according to plan
is calculated on a straight-line basis according to the
estimated useful economic lives.
The depreciation periods are as follows:
»
OL1 and OL2 nuclear power plant units:
-
Basic investment 61 years
-
Investments made according to the modernisation
programme 16–35 years
-
Automation investments
associated with the modernisation 15 years
-
Additional investments 10 years
»
Buildings and structures 10–40 years
»
TVO’s share in the Olkiluoto
gas turbine power plant 30 years.
Valuation of inventories
Materials and supplies have been valued at direct
acquisition cost, nuclear fuel according to calculated
fuel consumption, and supply stocks at average
acquisition cost. If the replacement value of inven
-
tories on 31 December is lower than the original
acquisition cost, the difference will not be entered
in the books as an expense because the Company
operates at cost price.
CO
2
emission rights
Carbon dioxide (CO
2
) emission rights are included in
the intangible assets. Emission rights are recognised
at historical cost. The current liability for returning
emission rights is recognised at the carrying value
of possessed emission rights. If there is a shortfall, a
current liability is recognised to cover the acquisition
of the missing emission rights. This current liability
is valued at the current market value of the emission
rights at the balance sheet date. The cost of the
emission rights is recognised in the income statement
under costs of materials and services. The gains
from the sales of emission rights are refunded to the
equity holders of the Company.
Research and development costs
Research and development costs associated with
production activity are entered as annual costs for
the year in which they were incurred.
Items denominated in foreign currency
Transactions in foreign currency have been entered
at the relevant exchange rate or at the transaction
rate for purchase and sale of foreign currency. On
the balance sheet date, exchange rate differences
on foreign currency accounts have been entered in

expenses.
Money market instruments
Money market instruments comprise shares in short-

They are valued in the balance sheet at their original

-


The Company applies hedge accounting. Derivative

the balance sheet. Their nominal values and fair
values are presented in the Notes to the Financial
Statements.

managed with interest rate swaps. Interest costs of
these instruments have been entered on an accrual

income and expenses.
Payments of foreign currency denominated inven
-
tory acquisitions have been hedged with currency
derivatives. The realised exchange rate differences

to adjust the acquisition cost of inventories. Cross
currency swaps have been used to hedge foreign
currency denominated long-term loans.
ITEMS RELATED TO NUCLEAR WASTE
MANAGEMENT LIABILITY
The nuclear waste management obligation is
provided for in the Nuclear Energy Act. The obligation
covers all future costs from nuclear waste handling,
including the decommissioning of nuclear power plant

and the risk margin, decommissioning being assumed
to start at the end of the year in question.
The Ministry of Economic Affairs and Employment

liability for nuclear waste management for the current
year and the target reserve for the next year.
The company liable for nuclear waste management
shall pay its contribution to the Finnish State Nuclear
Waste Management Fund, so that the company’s
share in the Fund on 31 March is equal to the

calendar year in question.
According to the Nuclear Energy Act Section 52 c,
which entered into force on 1 May 2021, a three
percent protected portion shall be added to the Fund
target of the calendar year for a party with a nuclear
waste management obligation. The protected portion

in the Nuclear Energy Act Section 42 and the Fund’s

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
must supplement the shares in the Fund by paying more nuclear waste management fee for the part that the

party with a nuclear waste management obligation in the nuclear waste management fee for the part that the

In addition, a party with a nuclear waste management obligation shall supply the Finnish State Nuclear Waste

day of March, the total amount of the collateral security corresponds with the protected portion for the part

by the party with a nuclear waste management obligation, which is not needed to cover the protected portion

business day of April in the same calendar year.
The annual contribution to the Finnish State Nuclear Waste Management Fund and costs from nuclear
waste management and services are entered as annual expenses. The nuclear waste management fee is
based on the Company’s proposal. If the nuclear waste management fee set by the Finnish State Nuclear
Waste Management Fund differs from the amount proposed by the Company, the difference is entered in the

The nuclear waste management liability and TVO’s funding target obligation to the Finnish State Nuclear
Waste Management Fund are presented in the Notes to the Financial Statements.
The Company must supply the Ministry with guarantees to cover for the difference between the legal nuclear
waste management liability and the Company´s share in the Finnish State Nuclear Waste Management Fund,
as well as for unforeseen expenses in nuclear waste management. Guarantees are presented in the Notes to
the Financial Statements.
The amendment to the Nuclear Energy Act concerning the investment activities of the Finnish State Nuclear
Waste Management Fund entered into force on 1 January 2022. With the amendment, the amount of
relending available to a party with a nuclear waste management obligation was limited to 60 percent, and the
investment activities were expanded to also include other asset classes than Finnish government bonds. TVO
uses the right to borrow funds back, and lends them further to its shareholders.

EUR 1,000 2022 2021
Olkiluoto 1 and Olkiluoto 2 346,820 293,781
Olkiluoto 3 6,659 0
 353,479 293,781

Olkiluoto 1
6,918 7,393
Olkiluoto 2 7,522 7,021
Olkiluoto 3 1,876 0
 16,316 14,414

EUR 1,000 2022 2021
Personnel expenses related to OL3 21,310 25,036
4 Other income
EUR 1,000 2022 2021
Rental income 1,144 1,101
Sales of services 14,543 14,132
Other income 1,360 1,201
 17,047 16,434
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
EUR 1,000 2022 2021
Purchases, accrual basis
Nuclear fuel
60,845 61,757
Materials and supplies 6,084 5,011
Increase (-) or decrease (+) in inventories 6,948 -964
 73,877 65,804
CO
2
emission rights 110 151
Nuclear waste management
Contribution to the Finnish State Nuclear Waste Management Fund
1)
40,849 -24,648
Nuclear waste management services 59,554 65,295
 100,403 40,647
External services 9,539 8,596
 183,929 115,198
Consumption
Nuclear fuel
69,672 61,387
Materials and supplies 4,205 4,417
 73,877 65,804
1)



2022 2021
 834 809
Manual workers 195 193
 1,029 1,002

2022 2021
 816 791
Manual workers 189 191
 1,005 982
Personnel expenses
EUR 1,000 2022 2021
Wages and salaries 67,247 68,898
Pension expenses 10,645 10,592
Other compulsory personnel expenses 2,247 2,471
 80,139 81,961

Key management compensations are presented in Note 26  in

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
EUR 1,000 2022 2021
Depreciation according to plan
Other capitalised long-term expenses
410 408
Buildings and construction 4,493 3,577
Machinery and equipment 35,377 33,013
Other tangible assets 410 652
 40,690 37,650
8 Other expenses
EUR 1,000 2022 2021
Maintenance services 21,365 24,297
Regional maintenance and services 9,651 10,428
Research services 2,338 2,416
Other external services 26,283 30,638
Real estate tax 6,489 6,034
Rents 2,043 1,948
ICT expenses 6,206 6,078
Personnel related expenses 4,216 4,001
Corporate communication expenses 862 836
Other expenses 21,750 17,833
 101,203 104,509

PricewaterhouseCoopers Oy (EUR 1,000) 2022 2021
Auditing 231 260
Tax services 13 28
Other services 65 70
 309 358

EUR 1,000 2022 2021

From joint ventures
2 209 0
 2 209 0

From joint ventures
13 11
From others 3,377 3,612
 3,390 3,623

From others
2,652 483
 2,652 483
 8,251 4,106

To the Finnish State Nuclear Waste Management Fund
3,377 3,612
To others 103,628 96,321
Capitalised interest costs -102,577 -95,819
 4,428 4,114
 3,823 -8
Financial income and expenses include exchange rate gains (+) and losses (-) (net) 505 439
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10 Appropriations
EUR 1,000 2022 2021
Group contribution 393 503
The difference between depreciation according to plan and tax depreciation, increase (-) or
decrease (+)
12,118 3,572
 12,511 4,075

EUR 1,000

expenses
Intangible
rights
Other capitalised
long-term expenses
Advance
payments Total

Acquisition cost
1 Jan 2022 54,011 159 26,635 276 81,081
Increase 0 110 296 76 482
Decrease 0 -140 -275 0 -415
Transfer between categories 0 0 0 0 0
Acquisition cost 31 Dec 2022 54,011 129 26,656 352 81,148
Accumulated depreciation according to plan 1 Jan 54,011 0 24,526 0 78,537
Accumulated depreciation from deduction 0 0 -275 0 -275
Depreciation according to plan 0 0 410 0 410
312022 0 129 1,995 352 2,476
Accumulated depreciation difference 1 Jan 0 0 1,432 0 1,432
Change in depreciation difference 0 0 -134 0 -134
Accumulated depreciation difference 31 Dec 0 0 1,298 0 1,298
Undepreciated acquisition cost in taxation 31 Dec 2022 0 129 697 352 1,178
EUR 1,000
Land
and water
areas
Building and

Machinery
and
equipment
Other
tangible
assets

progress and
avance payments Total

Acquisition cost
1 Jan 2022 12,054 291,337 1,368,065 53,656 5,214,339 6,939,451
Increase 21 1,498 19,021 880 317,126 338,546
Decrease 0 -1,623 -8,344 -12 0 -9,979
Transfer between categories 0 4,443 34,181 0 -38,624 0
Acquisition cost 31 Dec 2022 12,075 295,655 1,412,923 54,524 5,492,841 7,268,018
Accumulated depreciation according to plan 1 Jan 0 229,311 952,366 48,716 0 1,230,393
Accumulated depreciation from deduction 0 -1,623 -8,344 -12 0 -9,979
Depreciation according to plan 0 4,493 35,377 410 0 40,280
312022 12,075 63,474 433,524 5,410 5,492,841 6,007,324
Accumulated depreciation difference 1 Jan 0 -1,752 191,336 2,310 0 191,894
Change in depreciation difference 0 1,961 -13,875 -70 0 -11,984
Accumulated depreciation difference 31 Dec 0 208 177,461 2,240 0 179,909
Undepreciated acquisition cost in taxation 31 Dec 2022 12,075 63,265 256,063 3,170 5,492,841 5,827,414
Share of machinery and equipment from book value
31 Dec 2022 413,503
Share of machinery and equipment from book value
31 Dec 2021 398,574
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
EUR 1,000
Holdings
in group
companies
Holdings
in joint
ventures
Other stocks
and shares
Loan
receivables,
joint
ventures
Loan
receivables,
others
Long-term
receivables Total
Acquisition cost 1 Jan 2022 8 1,011 4,219 2,257 711,771 0 719,266
Increase 0 0 0 133 15,910 56,730 72,773
Decrease 0 0 0 0 -75,837 0 -75,837
Acquisition cost 31 Dec 2022 8 1,011 4,219 2,390 651,844 56,730 716,202
312022 8 1,011 4,219 2,390 651,844 56,730 716,202



651,339 651,339
Group companies Group share, %
TVO Nuclear Services Oy, Eurajoki 100
Joint ventures Holding of the parent company, %
Posiva Oy, Eurajoki, A series 60
Posiva Oy, Eurajoki, B series 74

EUR 1,000 2022 2021

Replacement cost
159,407 133,705
Book value 92,740 99,268
 66,667 34,437
Raw uranium and natural uranium 92,740 99,268
Nuclear fuel 169,684 166,681
Supplies 9,859 8,472
 272,283 274,421

EUR 1,000

expenses
Other
capitalised
long-term
expenses
Buildings and

Machinery
and
equipment
Other
tangible
assets

in progress Total

Acquisition cost
1 Jan 2022 11,046 1,167 27,122 95,394 2,402 1,689,021 1,826,152
Increase 0 0 0 0 0 102,489 102,489
Acquisition cost 31 Dec 2022 11,046 1,167 27,122 95,394 2,402 1,791,510 1,928,641
Accumulated depreciation according
to plan
1 Jan 11,046 936 21,735 76,446 1,925 0 112,088
Depreciation according to plan 0 12 284 997 25 0 1,318
312022 0 219 5,103 17,951 452 1,791,510 1,815,235
Accumulated depreciation difference
1 Jan 0 231 5,387 18,948 477 0 25,043
Change in depreciation difference 0 -12 -284 -997 -25 0 -1,318
Accumulated depreciation difference
31 Dec 0 219 5,103 17,951 452 0 23,725
Undepreciated acquisition cost in
taxation
31 Dec 2022 0 0 0 0 0 1,791,510 1,791,510
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
EUR 1,000 2022 2021

Accrued income
1,487 1,245
 1,487 1,245

Interest receivables
2 0
Loan receivables 0 212
Prepayments and accrued income 3,816 2,669
 3,818 2,881

Trade receivables
9,780 9,301
Other receivables
1)
207,059 204,545
 216,839 213,846

1)
Accrued interest costs 20,535 20,069
Accrued insurance costs 2,511 2,265
Collateral received 4,690 2,160
Other prepaid expenses 996 35,742
 28,732 60,236
 250,876 278,208
1)

EUR 193.1 million have been transferred to the other receivables from prepayments and accrued income.

EUR 1,000 2022 2021
Share capital 1 Jan 600,365 600,365
Share capital 31 Dec 600,365 600,365
Share premium reserve 1 Jan 232,435 232,435
Share premium reserve 31 Dec 232,435 232,435
Statutory reserve 1 Jan 9,948 9,948
Statutory reserve 31 Dec 9,948 9,948
1 Jan 18,730 14,460
Change 0 4,270
31 Dec 18,730 18,730
 2,209 0
 863,687 861,478

EUR 1,000 2022 2021
Retained earnings 18,730 18,730
 2,209 0
Total 20,939 18,730
REPORT OF THE BOARD OF DIRECTORS AND FINANCIAL STATEMENTS 2022
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
EUR 1,000 2022 2021
Bonds 3,307,900 2,813,560
 1,216,233 966,841
Other loans 17,350 56,117
4,541,483 3,836,518
Shareholders' loans
1)
929,300 929,300
Loan from the Finnish State Nuclear Waste Management Fund
2)
651,339 711,266
 6,122,122 5,477,084
1)
Subordinated loans
2)
Lent further to the shareholders.

Currency
Capital
2022
EUR 1,000
2022
Capital
2021
EUR 1,000
2021
Maturity
date
EUR 30,000 30,000 9.5.2022
1)
EUR 100,000 100,000 12.9.2022
1)
EUR 23,000 23,000 1.12.2022
1)
EUR 75,000 75,000 75,000 75,000 14.12.2027
EUR 20,000 20,000 20,000 20,000 8.11.2032
EUR 23,000 23,000 23,000 23,000 3.5.2030
EUR 20,000 20,000 20,000 20,000 8.5.2024
EUR 45,000 45,000 45,000 45,000 31.3.2032
EUR 500,000 500,000 500,000 500,000 4.2.2025
EUR 205,665 205,665 311,777 311,777 13.1.2023
1)
EUR 400,000 400,000 400,000 400,000 8.5.2024
EUR 650,000 650,000 650,000 650,000 9.3.2026
EUR 600,000 600,000 600,000 600,000 23.6.2028
EUR 600,000 600,000 31.3.2027
EUR 150,000 150,000 13.9.2032
SEK 1,000,000 97,561 15.2.2022
1)
SEK 500,000 48,781 500,000 48,781 15.2.2024
SEK 850,000 82,927 850,000 82,927 15.2.2024
SEK 500,000 46,624 500,000 46,623 29.10.2024
SEK 500,000 46,568 500,000 46,568 29.10.2024
 3,513,565 3,120,237
Current portion of long-term bonds
1)
205,665 306,678
 3,307,900 2,813,559
BONDS
REPORT OF THE BOARD OF DIRECTORS AND FINANCIAL STATEMENTS 2022
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
Currency
Capital
2022
EUR 1,000
2022
Capital
2021
EUR 1,000
2021
Maturity
date
GBP 0 0 0 0
 0 0 0 0
Current portion of other loans
1)
0 0 0 56,117 15.11.2022
1)
Total 0 0 0 56,117
Collateral received 17,350 17,350 0 0 30.11.2030
 17,350 17,350 0 56,117

EUR 1,000 2022 2021
Debts due in more than 5 years 1,217,168 1,250,922

EUR 1,000 2022 2021

Accruals
1 1
 1 1

Accruals
3,031 1,018
 3,031 1,018

Advances received
23,064 21,218
Trade payables 17,819 56,671
 40,883 77,889

Bonds
205,665 306,678
 50,608 48,258
Commercial paper program 0 85,240
 256,273 440,176

Finnish State Nuclear Waste Management Fund
40,227 13,312
Accrued interests 50,316 40,481
Accrued personnel expenses 22,742 23,792
Accruals related to CO
2
emission rights 129 159
Other accruals and deferred income 20,902 26,913
 134,316 104,657
 434,504 623,741
OTHER LOANS
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
EUR 1,000 2022 2021
Leasing liabilities falling due in less than a year 2,814 2,466
Leasing liabilities falling due later 47,462 47,557
 50,276 50,023

EUR 1,000 2022 2021
Bank guarantees 550 550

EUR 1,000 2022 2021
Liability for nuclear waste management according to the Nuclear Energy Act
1)
1,839,600 1,816,100
TVO's funding target obligation 2023 (2022) to
the Finnish State Nuclear Waste Management Fund 1,457,900 1,436,100
Collateral for nuclear waste management contingencies 534,990 480,670
Nuclear waste management loan receivables pledged to
the Finnish State Nuclear Waste Management Fund 651,339 711,266
1)
Based on the nuclear waste management programme and the proposal for the liability made by

20 Commitments
TVO has the right to redeem the lease object for EUR 42.7 million in 2025.
PENDING COURT CASES AND DISPUTES
See Note 25 

EUR 1,000 2022 2021

Interest rate swaps (nominal value)
2,185,000 1,944,117
Fair value 191,156 7,987

Forward foreign exchange contracts (nominal value)
44,127 69,597
Fair value 11,482 12,035

Cross-currency swaps (nominal value)
224,873 378,577
Fair value 13,576 7,745
Risk management principles, principles for the recognition of derivatives as well as details of derivatives are

the hedged risk and hedging instrument will perfectly match with each other. In documents regarding these
hedging relationships, the hedged risks and hedging instruments are extensively described and the effective
-
ness between them is demonstrated.
REPORT OF THE BOARD OF DIRECTORS AND FINANCIAL STATEMENTS 2022
79
REPORT OF THE BOARD OF DIRECTORS KEY FIGURES GROUP FINANCIAL STATEMENTS PARENT COMPANY FINANCIAL STATEMENTS FINANCIAL INFORMATION

Number
2022
Number
2021
EUR 1,000
2022
EUR 1,000
2021
12
1
Jan 680,000,000 680,000,000 115,600 115,600
Change 0 0 0 0
31
Dec 680,000,000 680,000,000 115,600 115,600
3
1
Jan 680,000,000 680,000,000 484,765 484,765
Change 0 0 0 0
31
Dec 680,000,000 680,000,000 484,765 484,765
 1,360,000,000 1,360,000,000 600,365 600,365

According to the Articles of Association, TVO delivers electricity to its shareholders on the so-called Mankala
principle, i.e. it delivers the electricity produced or procured to its shareholders in proportion to their share
-


divided into series of shares. The balance sheet, which will be presented to the Shareholders’ Meeting, speci
-

t CO
2
2022
EUR 1,000 t CO
2
2021
EUR 1,000
Total annual emissions from production facilities 1,449 2,435
Possessed emission rights 1,604 2,740
Emission rights bought
1)
1,300 110 2,500 151
1)
The purchases of the emission rights are included in materials and services. The emission rights that the Company
possesses on 31 December are included in intangible rights on the balance sheet and emission right reductions.
23 CO
2
emission rights
TVO’s CO
2
emissions are generated by the releases of the reserve boilers and the emergency diesel gener-
ators. In principle TVO has, on December 31, emission rights at least the same amount as the actual annual
emissions are. If the actual emissions exceed the amount of the emission rights that the Company possesses,
the Company has booked the expense for exceeding emission rights at the market value on December 31.
REPORT OF THE BOARD OF DIRECTORS AND FINANCIAL STATEMENTS 2022
80
REPORT OF THE BOARD OF DIRECTORS KEY FIGURES GROUP FINANCIAL STATEMENTS PARENT COMPANY FINANCIAL STATEMENTS FINANCIAL INFORMATION
Proposals to the Annual General Meeting
Teollisuuden Voima Oyj’s distributable equity as of 31
December 2022 amounted to EUR 20,938,560.00, of

EUR 2,208,600.00. The Board of Directors proposes



dividend shall be paid. Ilkka Tykkyläinen
Tapio Korpeinen
Timo Rajala
Jarmo Tanhua
CEO
Hannu Jokinen
Petra Lundström
Anders Renvall
Tiina Tuomela
Esa Kaikkonen
Seppo Parvi
Rami Vuola

Helsinki, February 15, 2023
The auditors note
Our auditors report has been issued today.
Helsinki, February 15, 2023
PricewaterhouseCoopers Oy
Authorised Public Accountants
Niina Vilske
Authorised Public Accountant
REPORT OF THE BOARD OF DIRECTORS AND FINANCIAL STATEMENTS 2022
81
REPORT OF THE BOARD OF DIRECTORS KEY FIGURES GROUP FINANCIAL STATEMENTS PARENT COMPANY FINANCIAL STATEMENTS FINANCIAL INFORMATION
Auditors Report (Translation of the Finnish Original)


OPINION
In our opinion
»


»


with statutory requirements.
Our opinion is consistent with the additional report to the Audit Committee.
What we have audited


»


»

BASIS FOR OPINION


ments section of our report.

opinion.
Independence


responsibilities in accordance with these requirements.




OUR AUDIT APPROACH
Overview
»

€ 25 million
»

of the parent company Teollisuuden Voima Oyj.
»
Olkiluoto 3 EPR plant unit in the test production phase
»


REPORT OF THE BOARD OF DIRECTORS AND FINANCIAL STATEMENTS 2022
82
REPORT OF THE BOARD OF DIRECTORS KEY FIGURES GROUP FINANCIAL STATEMENTS PARENT COMPANY FINANCIAL STATEMENTS FINANCIAL INFORMATION



future events that are inherently uncertain.
Materiality








a whole.
Overall group materiality
How we determined it
Rationale for the materiality benchmark applied

0.3 % of balance sheet total
We chose balance sheet total as the benchmark
because the company’s operations are very capital
intensive and because, in our view, this is the

Group is commonly measured by users.
How we tailored our group audit scope



parent company Teollisuuden Voima Oyj.
KEY AUDIT MATTERS



opinion on these matters.


misstatement due to fraud.
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REPORT OF THE BOARD OF DIRECTORS KEY FIGURES GROUP FINANCIAL STATEMENTS PARENT COMPANY FINANCIAL STATEMENTS FINANCIAL INFORMATION
 
OLKILUOTO 3 EPR PLANT UNIT IN THE TEST PRODUCTION PHASE




test production phase continued and electricity production started in 2022, but the plant investment is
still incomplete.


sheet.















holder responsibilities incorporated in the Articles of Association.

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REPORT OF THE BOARD OF DIRECTORS KEY FIGURES GROUP FINANCIAL STATEMENTS PARENT COMPANY FINANCIAL STATEMENTS FINANCIAL INFORMATION
 
ASSETS AND PROVISIONS RELATED TO THE NUCLEAR WASTE MANAGEMENT OBLIGATION











factor, cost estimates and discount rate.




prepared consistently based on the best available information at the time.
We tested the mathematical accuracy of the calculations and whether the calculations are technically prepared


determined.



REPORT OF THE BOARD OF DIRECTORS AND FINANCIAL STATEMENTS 2022
85
REPORT OF THE BOARD OF DIRECTORS KEY FIGURES GROUP FINANCIAL STATEMENTS PARENT COMPANY FINANCIAL STATEMENTS FINANCIAL INFORMATION
RESPONSIBILITIES OF THE BOARD OF DIRECTORS AND THE MANAGING DIRECTOR FOR THE
FINANCIAL STATEMENTS






misstatement, whether due to fraud or error.





AUDITOR’S RESPONSIBILITIES FOR THE AUDIT OF THE FINANCIAL STATEMENTS

from material misstatement, whether due to fraud or error, and to issue an auditors report that includes our




statements.


»




internal control.
»



»


»



conclude that a material uncertainty exists, we are required to draw attention in our auditor’s report to the related disclo

on the audit evidence obtained up to the date of our auditor’s report. However, future events or conditions may cause the

»


fair view.
»












disclosure about the matter or when, in extremely rare circumstances, we determine that a matter should not


REPORT OF THE BOARD OF DIRECTORS AND FINANCIAL STATEMENTS 2022
86
REPORT OF THE BOARD OF DIRECTORS KEY FIGURES GROUP FINANCIAL STATEMENTS PARENT COMPANY FINANCIAL STATEMENTS FINANCIAL INFORMATION

APPOINTMENT
Teollisuuden Voima Oyj became a public interest entity in June 2009. We have been the auditors of Teol
lisuuden Voima Oyj all that time it has been a public interest entity.
OTHER INFORMATION

mation comprises the report of the Board of Directors and the information included in the Annual Report, but

Board of Directors and Annual Report prior to the date of this auditors report.






In our opinion
»

»

If, based on the work we have performed on the other information that we obtained prior to the date of this
auditors report, we conclude that there is a material misstatement of this other information, we are required

OTHER STATEMENTS


is in compliance with the Companies Act. We support that the members of the Board of Directors and the

Helsinki 15 February 2023
PricewaterhouseCoopers Oy
Authorised Public Accountants
Niina Vilske

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Financial information in 2023
In 2023, Teollisuuden Voima Oyj will publish the interim reports as follows:
INTERIM REPORT FOR JANUARY-MARCH 2023
on April 20, 2023
INTERIM REPORT FOR JANUARY-JUNE 2023
on July 17, 2023
INTERIM REPORT FOR JANUARY-SEPTEMBER 2023
on October 20, 2023
REPORT OF THE BOARD OF DIRECTORS AND FINANCIAL STATEMENTS 2022
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ESEF-report

 Teollisuuden Voima Oy
 Finland
 Public Limited Compan
 Finland
 Töölönkatu 4, 00100 Helsinki
 Olkiluoto, 27160 EURAJOK
 Production of electricity with nuclear power
 Teollisuuden Voima Oyj
 Teollisuuden Voima Oyj
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