Construction of weatherproof electricity network continued successfully
The year 2014 was successful for Elenia Oy in many ways. We improved our entire customer service chain and achieved our investment targets. We also continued to complete significant financing arrangements through bonds and notes issued by Elenia Finance Oyj. As the year was also favourable to us in terms of extreme weather events, we achieved our targets with respect to financial performance as well.
Several efficiency-improving IT development projects underway
Excellent customer service is a key strategic goal for us. Our work to further develop customer services has progressed well, and we are already close to our target levels. Going forward, the development of customer services will be boosted by the implementation of a new customer information system in 2016, for which we have made the procurement decision and selection of the supplier in 2014.
During the financial year of 2014, we also continued several other IT development projects in various areas such as budgeting and monitoring of operational processes. The implementation of our new intranet was an important project with regard to internal communication. Our new extranet, which serves our external stakeholders, was introduced in early 2015. We also continued developing our mobile solutions especially in relation to reviewing, monitoring and reporting of on-site operations.
Substantial investments in improving the security of supply of electricity
As during recent years, our most significant investments in 2014 were directed to the construction of weatherproof electricity network. These investments reached our target level of approximately EUR 100 million, which was substantially higher than in the previous years.
The most significant factor in improving the security of supply is increasing the underground cabling rate of medium voltage network. We have now tripled the underground cabling rate of medium voltage network from 6% in 2009 to 19% at present. At the end of 2014, the total underground cabling rate of our network was 30.9%. This means that we are ahead of the schedule to meet the targets for the development of security of supply as stipulated by the Electricity Market Act which entered into force in 2013.
In 2014, there were no exceptionally strong storms in our operational areas. Avoiding the costs of repairs caused by storms enabled us to achieve a result that exceeded our expectations and that was higher than in the previous year.
Financing arrangements and corporate reorganisation continued
In 2013, we launched a bond programme which involved issuing and listing of bonds amounting to EUR 650 million on the London Stock Exchange. In 2014, we continued to implement financing arrangements by issuing secured bonds and notes at a total amount of EUR 333 million. The total value of secured bonds and notes issued by the end of 2014 was at EUR 983 million. The proceeds from the issuances have been used to repay our bank loans.
To streamline the operational structure of Elenia Group, we incorporated our customer service operations into Elenia Palvelut Oy which started its operations in the beginning of 2015. In addition to Elenia Oy, Elenia Palvelut Oy provides services for Elenia Lämpö Oy and, until the end of 2015, transitional customer services for Vattenfall Oy.
New regulatory guidelines for the development of the industry to be confirmed in 2015
The Energy Authority has published the first draft guidelines for the next two regulatory periods which are 2016–2019 and 2020–2023. The regulatory guidelines play an important role in the development of the electricity distribution industry in Finland. The Energy Authority is expected to make a final decision on the regulatory guidelines in the autumn of 2015 after having received comments from industry operators.
Aiming for further improvements in customer service
Building weatherproof network will continue to be our primary focus and our levels of investment in underground cabling will remain largely unchanged in the coming years. In the development and automatisation of service and operating processes, our focus will shift from the acquisition of new systems to the implementation and efficiency-driven utilisation.
We want to be a leader in customer service and, since 2007, we have voluntarily paid compensation to our customers for all outages lasting more than six hours. In addition to benefiting our customers, this service promise plays an important role in guiding our own operations towards increasing efficiency.
We can close the books for the financial year of 2014 with much satisfaction. We have progressed well with our financing arrangements and resource management. Our employee satisfaction is at an excellent level and both our company culture and our partnerships have developed fully in line with our values and objectives. For this, I would like to thank our customers, employees, partners, board members and shareholders.