Good morning, everyone. It is my pleasure to welcome you to Fortum's joint webcast and news conference for the investor community and media on our fourth quarter and full year 2024 financial results. My name is Ingela Ulves, and I'm head of investor relations at Fortum. As always, this event is being recorded, and you will find a replay on our website later today. With me here in the studio are our CEO, Markus Rauramo, and our CFO, Tiina Tuomela. Markus and Tiina will present the group's financial and operational performance during both the fourth quarter and the full year 2024, and how our strategy execution has progressed during the year. After the presentations, we again open up for questions on our Q&A session. I now hand over to Markus to start.
Thank you very much, Ingela. A warm welcome to our investor and media call also from my side. I will start by going through the key elements of our financial performance, market fundamentals, and follow up on our strategy implementation. After that, Tiina will provide more details, especially on the financials and how this turned into our results. Let me now start with the highlights. For Fortum, 2024 was a year dedicated to our core businesses to optimize our best-in-class operations, divest non-core operations, and implement efficiency improvement actions. With these measures, we are building the foundation for future growth. Our goal is to ensure strong financial performance even in turbulent operating environments. The year 2024 was wet, warm, and windy, meaning that the operating conditions were tough. The temperature was above normal, hydrology increased from below normal to above normal level, and we experienced record high wind generation.
At the same time, demand for power developed positively. In 2024, the Nordic consumption increased by 9 terawatt hours to 395 terawatt hours, while consumption in the fourth quarter declined by 5 terawatt hours to 107 terawatt hours compared to the previous year. Throughout the year, the lower Nordic spot power prices were reflected especially in our generation segment's financial results. However, due to our flexible and competitive CO2-free generation fleet, our achieved power price reached a good level in 2024, both through successful hedging and physical optimization. The result improved in the consumer solution and other operation segments, both in the fourth quarter and for the full year 2024. Regarding our strategic key performance indicators set in 2024, our optimization premium reached EUR 8.7 per megawatt hour in 2024, thus exceeding our annual target of EUR 6-EUR 8 per megawatt hour.
I will come back to these KPIs a bit later in my presentation. Within the scope of our strategic priority to transform and develop, we continued our efficiency improvement program with the target to gradually lower annual fixed cost by EUR 100 million , excluding inflation, by the end of 2025, with a full run rate from the beginning of 2026. During the year, we continued to reshape our group structure through investments and divestments. The strategic review of the circular solution businesses progressed well during 2024. The biggest transaction was the divestment of our recycling and waste business. The total consideration for the sale amounted to EUR 800 million , and Fortum recorded a tax-exempt capital gain of EUR 176 million in the fourth quarter.
In May, Fortum successfully divested its stake in the 185 megawatt solar portfolio in India for EUR 33 million and recorded a sales gain of EUR 16 million in the second quarter. Considering the unlevered balance sheet in combination with ample liquidity and current modest investments, our capital allocation focused on returning capital to our shareholders. The board's proposal is that Fortum would pay a dividend of EUR 1.40 per share, EUR 0.90 per share according to our dividend policy, meaning 90% payout from EUR 1 comparable earnings per share, and in addition to that, a special dividend of EUR 0.50 per share to correct the balance sheet and liquidity. The proposal is to pay the dividend in the second quarter of 2025 in one go to correct the balance sheet. We will come back to this topic later in the presentation.
Then I move over to our main figures and financial KPIs. These are the familiar comparable KPIs for both the group's fourth quarter and full year 2024. Considering all external factors, I'm satisfied with our performance. I am especially happy about our ability to optimize our generation, as the performance was even above the guided level. In 2024, power prices were at a clearly lower level than in 2023. Consequently, our comparable operating profit declined both for the quarter and on an annual basis. Lower power prices especially affected the result of our generation segment. In the fourth quarter, comparable operating profit for the group amounted to EUR 257 million and consequently totaled EUR 1.178 billion for the full year 2024. Our comparable EPS also declined both on a quarterly and cumulative basis, with the full year comparable EPS amounting to exactly EUR 1 per share.
For the full year, our operating cash flow decreased and was EUR 1.392 billion. However, for the fourth quarter, the operating cash flow increased to EUR 167 million. Finally, a few words on the balance sheet and most importantly, our leverage. Defined as financial net debt to comparable EBITDA, leverage was at 0.2 times at the end of 2024 compared to 0.5 times at the end of 2023. Next, I will say a few words about the commodity markets. European gas prices increased and reached EUR 50 per megawatt hour by the end of the year. The price increase was attributed to supply-side risks related to the expectation that Russian pipeline gas transit via Ukraine would end by the end of December. As Ukraine then eventually terminated the transit agreement, that put pressure on Europe's reliance on LNG and increased competition with Asia.
Volatile prices were reflected in the continental futures and spot markets. This, however, had limited impact on the Nordics. The year 2024 was warm, wet, and windy in the Nordics. High precipitation amounts in October and December further added to the already well-filled hydro reservoirs, especially in the northernmost hydro areas. Turning around from a deficit in the beginning of the year, the reservoir balance reached its highest level since the fourth quarter of 2020. Most of the surplus was in Norway, where Fortum does not have any hydropower generation. Looking at the current hydro reservoirs, they are currently at an all-time high level. In combination with the wet weather conditions, also the Nordic temperatures were 1.5 degrees Celsius higher than normal during Q4, resulting in lower than expected Nordic demand. All of this put pressure on spot prices, which declined to very low levels by late November.
A temporary rally upwards took place in early December on the back of a bit colder than normal weather, but then temperatures again increased during the holiday season and prices declined by the end of the year. As noted already, we set a new Nordics wind power output record as wind output in the Nordics increased by 8 terawatt hours to more than 31 terawatt hours during the fourth quarter, even though wind speeds were slightly below the normal level. Also, for the full year, a record was made as wind generation reached 95 terawatt hours. The power prices on the Nordics' futures market overall declined over the quarter, especially during the latter part of November and in December. CO2 prices have increased since we reported a quarter ago.
On an annual basis, CO2 prices decreased in 2024, the average price being approximately EUR 67 per ton, and in 2023, average price being approximately EUR 85 per ton. Then I move over to the strategy execution during the year 2024. We continue to execute our strategy in line with our strategic priorities. We deliver reliable, clean energy, we drive decarbonization of industries, and we transform and develop. At the Loviisa Nuclear Power Plant, the lifetime extension until 2050 is progressing well. During the year, we made decisions both to modernize the low-pressure turbines and in the fourth quarter to renew the main seawater pumps. We also reached an important milestone in securing reliable Western nuclear fuel as we loaded the first batch of Westinghouse fuel in August.
In our renewables business, the Pjelax wind farm, the third largest in Finland, was fully commissioned in the second quarter and began its commercial operations through the power purchase agreement with Finnish utility Helen in the beginning of July. This was a well-executed project, which was both on time and budget with good safety performance. To meet future demand growth from decarbonization, we have actively been working on developing a ready-to-build renewables project pipeline that we can offer our customers through PPAs. As a part of this target, we announced that we acquired a renewables development portfolio from the Finnish wind developer Enersense. In our district heating business, the Espoo Clean Heat program is making significant progress at Espoo and Kirkkonummi sites. We are making preparations for the waste heat offtake from the upcoming Microsoft data centers, as well as at the electricity-based plant in Nuijala, Espoo.
As part of the decarbonization program, we closed down our last coal-fired unit in Suomenoja used for district heating one year ahead of schedule. As part of our commitment to exit coal by 2027, we made a decision in the fourth quarter to invest EUR 100 million during 2025-2026 in the decarbonization of our Częstochowa CHP plant in Poland. Our generation fleet has one of the lowest CO2 emission intensities in Europe. So our strategy so far has been successful, and we have had a good starting point to reduce our emissions even further. I will come back to our science-based targets on the next slide. On our strategic priority to drive decarbonization in industries and to support the projected power demand growth from electrification, we have actively developed several potential industrial sites across Finland that we can offer to our industrial customers, including data centers.
In addition to the above-mentioned Microsoft data centers, one additional example of this is a site in Rauma that we started to develop for sustainable synthetic aviation fuel production, e-SAF, together with Norsk e-Fuel and the Port of Rauma. In the fourth quarter, we took on the role as an energy partner to support a feasibility study exploring low-carbon aluminum manufacturing opportunities in Kokkola and Kruunupyy in Finland. The facility, if realized, would consume approximately seven terawatt hours of electricity annually. Further, we began to build a two megawatt hydrogen pilot production plant in Loviisa. Recently, there have been active public discussions about possible new nuclear projects in both Sweden and Finland. At Fortum, we see that the electrification of industries, including data centers and transport, requires a balance of different power generation technologies. Predictability of the availability of cost and cost of energy is critical in the coming decades.
As the share of generation with intermittent renewables increases, hydropower has a vital role in balancing the energy system in the Nordics. In addition to flexible supply, a well-functioning power system would benefit from a stable foundation with nuclear power provided. Our nuclear feasibility study on both conventional nuclear and SMRs is in its final stages, and we will soon come back with more detailed key findings and conclusions. Regarding the economic conditions for new nuclear, we have previously already noted that the current power price levels in the Nordics do not cover commercial requirements for new nuclear. At Fortum, we consider it positive that the Swedish and Finnish governments are investigating financing and risk-sharing models, as well as electricity market mechanisms for new nuclear power projects, and have requested input from companies.
However, we are still very far from required technical and profitability conditions and making any potential investment decisions, and as everybody knows, constructing a nuclear power plant will take a long time, which means that new nuclear would provide power for the demand in the late 2030s at the earliest. When it comes to power demand and growth longer term, we continue to see robust underlying demand for long-term power purchase agreements. This supports the global trend, which also indicates demand for nuclear power. As the economic preconditions for new nuclear are currently challenging, lifetime extensions are a very valid solution. We are well positioned with the Loviisa lifetime extension, which provides 1,000 megawatts of capacity for the coming 22 years, corresponding to approximately 177 terawatt hours of additional reliable CO2-free baseload power until 2050, which we can offer to our industrial customers.
Furthermore, Fortum and the other owners of our co-owned nuclear plants in Sweden decided to investigate extensions up to 80 years of the operating lifetime of both the Oskarshamn and Forsmark nuclear power plants. Also, TVO is looking into lifetime extensions of Olkiluoto 1 and 2. Regarding flexible power in the energy system, we have today announced that we are starting a two-year feasibility study to explore prerequisites for new pumped hydro storage in Sweden. Pumped hydro storage would provide much-needed flexible balancing power, as it has the ability to both produce, store, and consume electricity during long periods of time and in big amounts. In Finland, Fortum's associated company Kemijoki Oy is exploring pumped storage hydro power plants in northern Finland. On our third priority, to transform and develop, we have been focusing both on efficiency improvement and divestments of non-core assets and businesses.
The strategic review of our circular solutions business took a huge step during the third and fourth quarters. In July, we signed an agreement to sell our recycling and waste business to Summa Equity for approximately EUR 800 million. During the year, we also divested the bio-based solutions, as well as our turbine and generator services. In addition, we also sold our last operative renewables business in India. We continue our efforts with the efficiency improvement program, with the target to gradually lower our annual fixed cost by EUR 100 million, excluding inflation, to achieve a new lower fixed cost base in 2026. However, as we simultaneously are preparing for growth, it means that we, while cutting and reallocating costs, are also increasing our development cost, for example, through renewables and site development. During the year, we also took some further actions to defend our shareholder rights in Russia.
We initiated legal proceedings against a former PAO of Fortum to recover approximately EUR 800 million in intercompany loans, including interest. There is only upside related to this legal case, as there is no impairment risk. This process, which is separate from the already ongoing arbitration proceedings against the Russian Federation due to the unlawful seizure of our Russian assets, is expected to take some years. Then I move over to the measuring of our strategy execution. In line with our commitment to the clean transition, one of our key focus areas in 2024 was our commitment to set science-based climate targets aligned with the 1.5 degrees Celsius path. Throughout 2024, we worked on setting our climate targets to get them validated by the Science Based Targets initiative.
In January this year, we were happy to announce our ambitious SBTi-verified targets, which include net zero greenhouse gas emissions across our whole value chain by 2040. We also aim to cut emissions from our own operations, meaning our Scope 1 and 2 emissions, by 85% by 2030. This is even more ambitious than the 1.5 degrees aligned target level. As you can see in this picture, the lighter green sections, our Scope 1 and 2 emissions, are already now really low. For our specific emissions, i.e., the amount of emissions per produced energy unit, we have one of the lowest specific CO2 emissions in Europe. In 2024, our specific emissions for power generation was just 11 grams of CO2 per kilowatt hour, and for total energy production, i.e., power and heat, it was 26 grams of CO2 per kilowatt hour.
This picture also shows our transition plan with concrete actions that we are taking to achieve net zero by 2040. As you can see, the main levers for our scope one and two emission reductions concern the decarbonization and coal exit of our own operations. The Meripori coal-fired power plant is now reserved only for severe national disruptions and emergencies until the end of 2026, and we are committed to its coal exit. As mentioned before, the Espoo Clean Heat program already exited coal in April 2024, and in October, we announced the decarbonization of the Częstochowa Combined Heat and Power Plant in Poland. Regarding scope three emissions, our main lever is increasing the share of renewable and nuclear-based electricity in the product portfolio in all markets.
This requires the sold electricity to have certificates of guarantees of origin, GOOs, which verify the source of the electricity to be low carbon, for example, wind, hydro, or nuclear power. We are very excited to continue this journey and will report regularly on the progress of our transition plans and results. As you remember, we set four strategic targets with measurable KPIs one year ago. Here you see these KPIs, targets, and the outcome at the end of 2024. Availability of our hydro generation fleet is crucial, and we set long-term targets for the availability of hydro and nuclear. In hydro, the performance in 2024 was good, and we reached the target. The outcome was 97% availability, exceeding the target of 95%. In nuclear, we did not reach the target of 90% availability, and the outcome was 84%.
90% availability is very challenging to reach, and during 2024, there were both prolonged and unplanned outages. When calculating the availability for nuclear, also planned outages are taken into account, counting against availability. The next target is the optimization premium, guided to be in the range of EUR 6- EUR 8 per megawatt hour annually. Our optimization premium exceeded this guidance and was EUR 8.7 per megawatt hour in 2024. This is clearly one of our competitive edges, and we achieved a very good result last year. The guidance remains the same going forward, even though the outcome exceeded the target range in 2024. The third KPI is long-term hedging, aiming at reducing our merchant exposure and increasing predictability of cash flows.
At the end of 2024, the hedged share of rolling ten-year outright generation volume was 18%, compared to our target to be at least 20% by the end of 2026. Consequently, we are on track with this target. While the target is to ensure ten-year hedging, currently we see demand for shorter PPA durations and smaller volumes. Hedges done during 2024 were mainly done for the years 2025 to 2029, with more than 100 counterparties. At the end of 2023, the hedged share of the rolling ten-year volume was 15%. The last target is to develop growth options and serve customer demand. The KPI is to have a ready-to-build pipeline for solar and onshore wind of at least 800 megawatts by the end of 2026. At the end of 2024, we did not have any projects that would have reached the ready-to-build state.
However, projects in the underlying pipeline are developing, and currently we have a pipeline of approximately five gigawatts of onshore wind and solar projects in the permit process pipeline across the Nordics, with even more in an early development phase. This also includes the Enersense portfolio acquisition that we announced in December. Consequently, the development is progressing, and we see that we will reach our target. It is good to note that the prerequisite for making any investment decisions on new renewables is that they are linked to profitable PPAs. Then a couple of words about our capital allocation principles. Our balance sheet is very strong, even overcapitalized, as financial net debt to comparable EBITDA is at 0.2 times. Our objective is to maintain a credit rating of at least BBB flat. At the end of 2024, we also had ample liquidity, totaling EUR 8.2 billion.
With the proposed dividend, we would both activate the balance sheet as well as reduce the liquidity position. Further, we mitigate the effect from changing interest rates, which are lowering deposit rates and thus increasing the net interest costs. The reason for the continued modest CapEx guidance is that currently power prices do not support new investments, and demand has not yet picked up. This guidance of EUR 1.4 billion, including annual maintenance CapEx of EUR 250 million, includes already allocated investments. However, if the market sentiment and investment environment improve and projects would meet our investment and profitability criteria, we would make new investment decisions. In 2024, our capital expenditure was below EUR 500 million. As part of the efficiency improvement, we focus on prudent cost allocation for both fixed and development costs to optimize our cash flow.
In this situation, with the overcapitalized balance sheet in combination with ample liquidity and modest investments, our priority for capital allocation is to return capital to our shareholders. When it comes to shareholder returns, we prefer cash dividends and do not intend to launch any share buyback programs. With the proposed dividend payment totaling EUR 1.256 billion, we would instantly activate our balance sheet and rectify our strong liquidity position. With this special dividend, the dividend yield is approximately 10%, which makes Fortum an attractive investment objective for our shareholders, while it reflects that in the nearest years, there is limited organic growth. I hope this clarifies our approach regarding our cash flow focus and capital allocation principles. We are currently focusing on building the preparedness for future growth to be ready for new investments when demand picks up.
We see that the Nordic countries are a good location for clean industrial investments, and it is part of our strategy to facilitate them. As mentioned, we are preparing a ready-to-build pipeline of renewable projects. For the longer term, in the 2030s, we are exploring prerequisites for pumped hydro and new nuclear, which would provide flexible and stable supply for projected new demand. With this, I end my part and hand over to Tiina for more details.
Thank you, Markus. Good morning, everyone, also on my behalf. I will now go through our financials in more detail. Let's start with the key financials. So let me first comment on some of the comparable KPIs. The comparable operating profit for the fourth quarter amounted to EUR 257 million and EUR 1,178 million for the year 2024.
In the fourth quarter, our comparable net profit and comparable EPS decreased, reflecting the lower result in the generation segment. Our comparable net profit for the quarter declined to EUR 169 million and EUR 900 million for the full year. Consequently, our comparable EPS for 2024 declined to EUR 1 compared to EUR 1.2 in 2023. On a positive note, our cash flow during the quarter improved to EUR 167 million and totaled EUR 1,392 million for the full year. Especially due to the divestment of the recycling and waste business, our leverage came further down and was very low with financial net debt to comparable EBITDA at 0.2 times at the end of the year. However, taking into account the dividend proposal presented today and adding the dividend payment to our net debt, leverage would decrease about one time.
Let's move over to the income statement to look at certain items in more detail. As we have communicated on our efficiency improvement program, the target is to reduce the fixed cost base by EUR 100 million, excluding inflation, and compared to the baseline year 2022. For 2024, our fixed costs saw a small decrease as our annual fixed costs are slightly below EUR 1 billion despite inflation. The fixed cost base continues to go down during this year as we now have actions in place to reduce it further. I will come back to more details on this program at the end of my presentation.
Items affecting comparability for the fourth quarter and the full year 2024 mainly reflect the EUR 176 million tax-exempt capital gain from the divestment of the recycling and waste business and change in fair value of derivatives, while the majority part in 2023 was related to fair value changes. Share of profits of associated and joint ventures includes updated cost estimate for the Swedish nuclear waste-related provision in co-owned nuclear companies, as these are reported in comparable numbers. Our finance cost net was positive. Net interest turned positive. Interest income includes interest income from a Belgian tax case, and in the fourth quarter, we recorded some interest income from a settlement of a commercial dispute recorded. Taxes have been at the normal guided level in 2024. Then over to the result waterfalls for comparable operating profit.
Let's look at the waterfall for the fourth quarter comparable operating profit for our segments. Compared to the previous year, the result in our generation segment decreased, while consumer solutions and other operations segment improved. In the generation segment, comparable operating profit decreased by EUR 125 million to EUR 265 million due to the lower spot and hedge prices, and because of lower hydro and nuclear volumes. The negative effect from the volume and price components was partly offset by the positive effect from lower nuclear waste cost in co-owned nuclear production in Finland. The result contribution of the Pjelax wind farm was slightly positive. The result of the district heating business improved mainly due to the lower fuel cost following more electricity-based productions in Finland and higher sales price for power in Poland.
In our consumer solution segment, comparable operating profit increased by four million to EUR 16 million, mainly due to the reduced scope of the regulated price cap for electricity end users in Poland. This was partly offset by higher depreciation and amortization of customer acquisition costs. In the other operation segment, comparable operating profit improved by EUR 19 million and was EUR 24 million negative, mainly due to the higher internal charges to the businesses for services of enabling functions. The result of the circular solution business decreased mainly due to the completion of the recycling and waste business divestment in November. Then, when looking at the comparable operating profit for the year 2024, the same pattern continues. The generation segment result declined, while both consumer solution and the other operation segment improved. The result deviation is basically related to the generation segment.
The generation segment's comparable operating profit decreased by EUR 461 million to EUR 1,218 million, mainly by the lower spot and hedge prices, but also lower generation volumes for both nuclear and hydro, and higher cost for Olkiluoto's third unit as the first months of 2023 was a test period. The result of the renewable business was positively impacted by a sale gain of EUR 16 million from the divestment of Fortum's remaining share in the Indian 185 megawatt solar power portfolio. The result contribution of the Pjelax wind farm was slightly positive. The result of the district heating business improved and turned positive, mainly due to the lower fuel cost, which was supported by more electricity-based heat production in Finland, and the higher sales price for heat and power in Poland.
Comparable operating profit in the consumer segment increased by EUR 38 million to EUR 76 million, mainly due to the higher electricity sales margin, reduced scope of regulated price cap for electricity end users in Poland, and higher sales margin for value-adding services. The positive effect was partly offset by lower gas margins in Poland and higher amortization of customer acquisition costs. In the other operation segment, the comparable operating profit improved by EUR 57 million and was EUR 116 million negative, mainly due to the higher internal charges for services of enabling functions. The result of the circular solution business decreased mainly due to the completion of the recycling and waste business divestment in November. Then some comments on our financial position, debt, and liquidity. Our financial position continues to be very strong, which supports our objective to maintain a credit rating of at least triple B.
When considering our capital allocation principles, we balance between leverage, investments, and dividends, while always keeping the credit rating in mind. I want to go through the reconciliation of our financial net debt in the fourth quarter. At the end of the third quarter, our financial net debt was EUR. 655 million. In the fourth quarter, the operating cash flow was EUR 167 million , and investment amounted to EUR 133 million . Realized CapEx for 2024 totaled EUR 483 million . The cash flow effect from our divestment, mainly the recycling and waste business, totaled EUR 758 million . In the fourth quarter, we also paid the second installment of the dividend, EUR 511 million . The change in interest-bearing receivables amounted to EUR 24 million, while FX and other effects was E UR 18 million .
At the end of 2024, our financial net debt was EUR 367 million , and the leverage ratio of financial net debt to comparable EBITDA was at 0.2 times. Looking at our debt portfolio and the loan maturity profile, I want to highlight a few things. We use bonds as a primary source of funding. Our maturity profile continues to be very balanced, and there are no large maturities in any single year. All in all, our gross debt, excluding leases, totals EUR 4.7 billion . At the same time, our liquidity position is strong. We have ample liquidity reserves of EUR 8.2 billion , with EUR 4.1 billion of liquid funds and EUR 4.1 billion of undrawn committed credit facilities and overdrafts. The cost for our EUR 4.7 billion loan portfolio is 3.8%, while the interest income that we get for our EUR 4.1 billion liquid funds is 3%.
With the strong liquidity position, we will continue to optimize our cash and credit lines. The overall objective is to have sufficient liquidity while optimizing the balance between debt and cash to minimize funding costs. I would like to remind you that considering the board's dividend proposal, we would pay total dividends of EUR 1,256 million in the beginning of the second quarter. As all dividends are paid in one go, the balance sheet and the liquidity position will be rectified at once. Going forward, we would consider returning to dividend payments with two installments. So, with this, let's have a look at a bit more detail of our leverage and liquidity. This shows a three-year development of our key figures related to leverage and liquidity. Our gross debt and margining requirements have clearly decreased over the time period.
Meanwhile, our liquid funds have been relatively stable, which has resulted in a lower net debt. Over this time period, also our EBITDA has decreased, and our financial net debt to comparable EBITDA is now at 0.2 times. When adding the proposed dividend to the net debt at the year end, our leverage ratio would be above one time. Market prices of today indicate that EBITDA could go down in the next few years, so with that, our leverage would increase. Our maximum leverage is somewhere between 2-2.5 times. We are, however, not targeting the maximum levels because we want to maintain a certain level of flexibility. As bonds are our main source of funding, we want to maintain our investment grade rating and have good access to bond markets. Investments need to be profitable and generate new EBITDA, which is challenging in the current price environment.
This is reflected in our CapEx guidance at the moment. As cash generation is aimed for investments and dividends, we also aim to be a good dividend payer for our shareholders, as today's proposal also shows. With these priorities, we also balance our liquidity position. Then over to the outlook section. The outlook section comprises, in essence, four elements: guidance for outright hedges, an optimization premium, taxes, CapEx guidance, and our fixed cost reduction program. First, a reminder that our annual outright volume is approximately 47 terawatt-hours. Already in connection with our first quarter result, we disclosed new weights of our different price areas. Starting with the hedges, at the end of the year, the hedge price for 2025 was at the same level as last quarter at EUR 42 per megawatt-hour. The hedge ratio increased by 10 percentage points to 75%.
The hedge price for 2026 is the same as last quarter at EUR 41 , while the hedge ratio increased by 5 percentage points to 45%. There are no changes to the annual optimization premium guidance. It continues to be at the level of EUR 6- EUR 8 per megawatt-hour. While the guidance for the annual level, there might be the quarterly variation. The guidance for our corporate tax rate also remains unchanged. We expect the comparable effective income tax rate to be in the range of 18%-20%. In 2024, the tax rate was 19.1%. I also want to repeat that in Sweden, there will be a revision of the property taxes from 2025. For Fortum, the increase of the property taxes is now estimated to be approximately EUR 30 million for the years 2025 to 2030.
This means that the increase is EUR 30 million from 2024 to 2025, after which it stays at the level for the six-year period, including 2030. A major part of this cost increase will be recorded in our fixed cost. Our previous estimate last autumn was that the increase would have been EUR 25 million . Then to the guidance of our capital expenditure. Capital expenditures for the years 2025 to 2027 are expected to be EUR 1.4 billion . This includes maintenance but excludes potential acquisition. The annual maintenance CapEx is expected to be approximately EUR 250 million for the guided time period and continues to be clearly below our depreciation level of approximately EUR 300 million . Growth CapEx will be in the range of EUR 150- EUR 300 million per year, showing a declining trend between the years.
Depending on how the general market develops and if the investment sentiment improves, we can always make new investment decisions. Finally, a few words about our fixed cost reduction program. We target to reduce our recurring annual fixed cost base by EUR 100 million , excluding inflation, and gradually until the end of 2025, with a new run rate from the beginning of 2026. The divestment in circular solutions, mainly Fortum recycling and waste business, reduces the group's fixed cost base by approximately EUR 150 million from 2025. In 2024, we implemented actions that reduced the recurring fixed cost base by more than EUR 60 million . Our current estimate is that the new run rate for its fixed cost base in 2026 will be approximately EUR 850 million , excluding the increase in the Swedish property tax from 2025.
We have already in 2024 taken actions to build preparedness for future growth, which consumed development cost of approximately EUR 50 million . As Markus already mentioned, simultaneously, there are additional costs for growth. These are related, for example, to renewable development, site development, build-up of the commercial organization, and the hydrogen pilot project, so this was all from my part, and now we are happy to answer your questions, so with this, Ingela, over to you.
Thank you, Tiina, and thank you, Markus, so we are now ready to open up for the Q&A session, and moderator, then I hand over to you, so let's hear the first questions.
If you wish to ask a question, please dial #5 on your telephone keypad to enter the queue. If you wish to withdraw your question, please dial #6 on your telephone keypad. The next question comes from Wanda Serwinowska from UBS. Please go ahead.
Hi, Wanda Serwinowska, UBS. Thank you very much for the presentation. Two questions for me. The first one is on the special dividend because I'm trying to understand how the situation is different from last year, because last year, you didn't announce any special dividend. CapEx plan was light. Balance sheet was strong. So what has changed over the past one year that you announced a special dividend this year? And how should we think about the special dividend going forward? Because if we look into 2025, CapEx remains limited, you mentioned a few times that appetite from investors, from industrial, is not there, power price seems to be steady. So how should we think about special dividend? That would be my first question. And the second question is about the nuclear investment and potential nuclear investment in Sweden and Finland.
There's a lot of noise about extension of the existing assets and building new nuclear assets. I know that at the end, you will make the decision based on a number of factors. But can you just talk about the timeline? Where should we expect the milestones in terms of the decision by the government or by you or by the TVO in Finland? Thank you.
Okay. Hello, Wanda. Hello, everybody. Happy to take the questions. Regarding the special dividend, our balance sheet has gotten even stronger than it was a year ago. Liquidity is very strong. And then we are measuring this against our potential investment pipeline. What we see with the special dividend now is that it stabilizes our liquidity position. So we have excess liquidity. And it also normalizes our balance sheet to the level of one.
I have said earlier that there is geopolitical uncertainty and there is turbulence. So, of course, we assess things against that as well. Then going forward, we stick to our dividend policy. So this was, like we said, and you said, this is a special dividend. So what you can expect going forward is that we follow the 60%-90% dividend policy. Then with regards to nuclear investments, I see that there are three key things that we are investigating. One is the technological availability of nuclear equipment and how long does it take to build, how much does it cost. Then one needs to understand where would the cash flows be coming from and where do you get the equity and debt for such an investment.
How we assess the situation right now is that the Nordic governments are supportive of new nuclear, generally speaking, but the market conditions or the regulatory or the governmental decisions are not yet there to take new investment decisions right now. We will come with more detail regarding the findings of the feasibility study during the spring, so we will go into more detail then, but generally, what we said also in the release and what I'm saying now is in the big picture where we stand.
Can I just follow up on the second one? Because I think in Sweden, around summer Q2, there should be another study or another proposal from the Swedish government, and I think earlier this year, the Finnish energy minister was talking about new nuclear, at least one reactor, I think most likely as a Mankala model.
But what I'm trying to understand, for example, this year, what date should we look at in terms of the clarity on the government side around extension on new nuclear involving Sweden and Finland?
Yeah. So many questions there, but in Sweden, the government is more concrete on where it is heading. This has been much delayed proposal regarding CFDs and construction time loans and government guarantees. Whether that comes into effect or not, that remains to be seen. Then there is still the question about the availability of technology and how it is licensed. And then who would be investing in such equipment as they are very large and long-term investments. With regards to lifetime extensions, that we are investigating. So as we know from the Loviisa, lifetime extension, 25 years of additional lifetime, EUR 1 billion of investment, 177 TWh of output. These are really good investments.
So if we can reliably and profitably extend the lifetimes, this is a great part of the CO2-free portfolio for us and for the Nordic countries. And of course, we think also about what is the viability of the whole nuclear sector. So it is good to have a very good understanding of what are the potential for lifetime extension and also what is the potential for new nuclear somewhere in the future. And then I'm thinking also about the big picture. So thinking about the 2050, reaching climate targets, reaching the targets that companies have set for themselves. And on the back of that, the big need for clean energy and how do we match the land availability for renewables, solar and wind, flexible assets, and then baseload power. My advice would be that it makes sense to keep all these tools in the toolbox for the time being.
Thank you.
The next question comes from Harry Wyburd from BNP Paribas Exane. Please go ahead.
Hi, morning everyone. Thanks for taking my question. So two for me, please. So firstly, I wanted to ask your view on long-term Nord Pool power prices, which have come down seemingly quite a lot. So from the sort of high 40s around the autumn of last year into the low 40s now. So interested to know why you think that move has happened. Is it the hydrology situation that we have at the moment sort of echoing down the forward curve, or do you think there's something more fundamental going on there in terms of the market's assessment of supply and demand a few years out? And have you sort of seen that price impact on the ground?
So is it impacting what you're adding in terms of your rolling long-term hedge, and do you think it might impact any negotiations you have over longer-term PPAs of off-takers like data centers? And then the second one, a slightly left-field question that doesn't come up very much on conference calls, certainly my experience, but I was reading that nuclear fuel or enriched uranium prices had absolutely rocketed or gone up by nearly three or four times in quite a short period of time recently. Is there anything you are seeing on the nuclear fuel side cost-wise that we should be keeping an eye on from a numbers perspective? Thank you.
Okay, so maybe Tiina, if you want to comment on the uranium more, if you're okay with that.
I'm fine.
And then on the prices, so as our headline actually says that this was a wet, warm, and windy quarter.
Overall, like I said in my part, 95 terawatt-hours of wind production in the Nordics, hydrology situation very strong, meaning high reservoirs. These have been pushing down the prices. If you look at where the continental TTF gas has gone, it's gone upwards. The Nordic forwards are under pressure. Nordics exported also 42 terawatt-hours last year of electricity. All this is pushing down the prices. Spot in the fourth quarter in our areas was EUR 31 . Our achieved price was EUR 52 . That partly comes back to the question that why are we hedging? We're hedging because we want to get the short-term visibility. The impact on the PPAs is that the appetite really seems to be both, I think both for us and our customers in the kind of midterm.
So like I said, in the years 2025 to 2029, that's where the sweet spot is. And if we think about the demand increase forecasts materializing 2027, 2028, 2029, this new demand, if it comes in larger volumes, it cannot be met with today's prices. So for new capacity to come online, that capacity has to get higher prices than when we are today. So structurally, Nordics are a good place to invest in. We have the lowest cost of energy in Europe, but new capacity will not come with these prices. And then uranium.
Yes. So we follow up the uranium prices, of course, because of our operation, but also our nuclear feasibility study. So uranium prices, if we look at the last summer, they were really rocketing, so more than $100 per pound.
Now, latest prices, what I looked at, they were around 70 dollars per pound. So clearly coming down. And I think that maybe the summer prices in a way reflected the boom of many nuclear discussions. The important point is that the nuclear fuel, if we look at the fuel cost in general in the power production cost, so it is not that big part. And the uranium itself is roughly half of the fuel elements price. But clearly, item to be followed, but now it looks to come a bit to the more normal levels.
Okay, thank you. That's clear. And so I'm Markus, just to return back to the power price point. So if I understood correctly that you think the decline in the long-term forwards is just simply a function of weather and that sort of knocking on down the forward curve, is that right?
Yes. It's the supply-demand weather, yeah. And hydrology is now very strong, which is not a positive thing for prices.
Got it. Understood. Thanks very much.
The next question comes from James Brand from Deutsche Bank. Please go ahead.
Hi, good morning. A couple of questions which follow up on themes that were kind of touched upon earlier, but maybe just coming at it from a slightly different angle. The first is, again, on the kind of special dividend and the balance sheet. Tiina, you said that you wanted in your remarks to maintain a degree of flexibility and that you weren't necessarily looking at the maximum leverage levels of two to two and a half times at the moment. I guess the question is, how long are you looking to kind of maintain that position of wanting flexibility?
Because some potential investments that could be very large ones for you might take a long time before you might start to spend significant amounts, particularly if you do go ahead with brand new power plant storage or brand new nuclear, that could be quite a number of years in the future. So is the position now that you want to maintain a stronger balance sheet, and that's the kind of the new status quo, or is there like a time limit on which you'd at that point say, well, okay, the investments have not materialized, we'll go up to closer to the maximum? That's the first question. And then the second one is on demand growth. You obviously talked about potential demand growth and things like data centers quite a bit.
I was wondering whether you could just give us maybe a bit more of a granular update in terms of specific projects. Are there some large projects that you're looking out for in the next few years that are going to make a big difference? And are you seeing those projects progressing? Or obviously, particularly when it comes to kind of green hydrogen and things like that, there's been a degree of stalling in projects in recent years. So are there kind of key projects that you're monitoring that are going ahead, or are they also kind of being delayed? Thank you very much.
Okay, so maybe I'll start with demand growth, and Tiina, if you want to take the dividend part. So yeah, so we're following very closely. I said that we have done PPAs with 100 counterparties.
So when we are doing now most of our selling to bilaterals, so that means that basically we are selling to everybody directly rather than through the exchanges as earlier. Then we have the pipeline of potentially interested customers, and then we talk about a big number of customers as well. And we see that the data center cases, they are progressing rather steadily as the demand is here and now today. So the use of data just increases all the time. There was like a recent article today in the Finnish press that there are 100 data center cases in Finland at the moment. And I think the electricity connection power was 27 gigawatts, if I'm not mistaken. I mean, huge numbers. Of course, all of this will not materialize. But that is more linear and that we see happening.
Then there are some larger cases like on the steel, both incumbents and newcomers. Aluminum, the one specific case I mentioned in Kokkola, Arctic Aluminium, seven terawatt-hours. So the scale is from terawatt-hour to seven north of Sweden, even more if the iron ore processing and steel goes clean, as it eventually will in many cases. So I see that the data centers are happening now, and then the other larger projects, they are more tied to the geopolitical and operating environment. So that's where we have seen some delay of projects and some cases have not gone well. For example, Northvolt is an example of that. Special dividend, do you want to take that?
Yes. So basically, our capital allocation principle is to have the balance with the strong balance sheet, the investment, and then the dividends. And as currently, our balance sheet is very, very strong.
We wanted to activate our balance sheet and make the dividend payment and this special dividend payment in these circumstances. But clearly, our target is also to look for growth and investments while we see that. So we want to keep that flexibility, not of course immediately go to the two and two and a half, but clearly there is a headroom. And then of course, the dividend is the part where we can flex the overall situation, but no specific time limit, but basically keeping an eye on these three different topics.
Great. Thank you very much.
The next question comes from Deepa Venkateswaran from Bernstein. Please go ahead.
Thank you. I had two questions.
So of the CapEx details that you've given in the guidance, how much of your approximately EUR 650 million of growth CapEx is already committed, and how much will sort of depend on new projects, PPAs, etc.? And second question, I just wanted to discuss the nuclear availability. So it's coming at 84% versus your targeted 90%. And I know there were some unusual outages in 2024. Could you talk about how the situation is progressing and when you expect to get to the 90% availability? And could you comment on what was the financial impact from the lower nuclear volumes in 2024? Thank you.
Yeah, so out of the CapEx guidance, the EUR 650 million , so most of that is committed. So now we previously communicated that we had left some headroom for future decisions in the three-year guidance.
So now we made that more accurate, and there's a tiny bit of headroom there. So the key message is that this is by and large already committed investments. And if we do new investments, as we clearly have the capacity for it, then we would announce it separately and then revise the guidance accordingly. But we are fine to do that, so we are not stuck on this number. Then for the nuclear availability, so there were unexpected reactor shutdowns and availability issues. I see that there is a possibility to rectify these during the year. With regards to Olkiluoto 3, it is still in the learning phase. So the annual outage, the first one that happened last year, that took longer than forecasted.
This is something we will now see that have we been able with the plant supplier to work it out so that we would get it to the normal level. But otherwise, I see that we have potential to fix the unavailability elsewhere and get to the right level. The financial impact is in the tens of millions of euros. So this is one of, in addition to our efficiency program, this is one of the things where we really have the solution in our own hands. So very much focus on this one.
Thank you.
The next question comes from Iiris Theman from Carnegie. Please go ahead.
Hi, this is Iiris Theman from Carnegie. Two questions, if I may. So firstly, your associate income was negative in Q4. So did it include any one-offs and what should we expect for this year?
And then secondly, just can you comment basically on your earnings development in the district heating business in Q4 and what should we expect for this year? Thanks.
Okay, I didn't quite catch the line was a little bit bad on the associated income. Associated income, okay. Okay, Ingela heard better.
Yes, thank you.
Okay, so yeah, on the associated income, we had the new co-owned nuclear.
That's correct. So it was the updated nuclear decommissioning and spent fuel costs, which we got the update from the SKB at the end of the year. So that reflects in the Q4 result.
Yeah, so that's not a recurring item as such.
No.
And then overall, the earnings development in Iiris's heating business is positive due to the decarbonization of the businesses and electrification. But Tiina, do you have any special comment on the fourth quarter?
Yeah, I think the positive thing, as you said, that the fuel cost is coming down when we produce more electricity by electricity. So this is positive. And then also prices, particularly in Poland, were higher, which made the improvement in the Q4 and then overall in the whole year turned to positive.
And this is one area where we expect that the results continue to improve as the electrification program, Espoo Clean Heat, continues. So there is upside there that will materialize as we complete the investments.
Okay, thank you.
The next question comes from John Campbell from Bank of America. Please go ahead.
Thank you. Good morning, everyone. I've got two questions if I can. I noticed you've reported an optimization premium for the full year at EUR 8.7 per megawatt hour.
And I think I backed out that you probably got around nine euros plus in the fourth quarter. First thing I would say, that's above your guidance. Can we expect you to announce your optimization premium going forward? I don't think you've really discussed it in that level of detail in the past. And maybe could I get some sort of logic of why you didn't perhaps upgrade the six to eight euro annual guidance? Is this some reflection of the fact you maybe don't think the volatility perhaps that we saw is sustainable, or is it related to caution on guarantees of origin? Anything around that would be extremely helpful. And then I know we've been discussing new nuclear, but I also saw an article on Bloomberg recently in January about Uniper and the prospect of the government selling its stake down there.
The article discussed the idea that some of Uniper's assets could be split up, and I suppose they've got hydro nuclear in Sweden. And if I'm not wrong, you have right of first offer, I think it is, until the end of 2026. I assume you'd be interested in those. So what are the odds you might be able to obtain them? Thank you.
Yeah, so on the optimization premium, so we feel comfortable that the EUR 6-EUR 8 continues to be relevant going forward. And overall, this was one of the highlights of the quarter and of the year that it's been strong performance. So we have had the asset availability, the flexibility in hydropower, and that is where most of the income is coming from. Then it's frequency regulation, up regulation, down regulation, grid services, and the GOOs.
But we feel comfortable that in the foreseeable future, six to eight is the right level. So this was a bit of positive upside. Then on the Uniper assets, so hydro nuclear are in the core of our operations. And if the Uniper assets become available, then we would naturally look at them. And we have heard the same that the German government is considering alternatives, but it seems that the IPO track is still on. We have the right of first offer. So if these assets particularly come for sale, then according to our agreement, we would have the first look at them and ability to then opine on are we interested or not.
Okay, thank you.
Thank you so much. These were actually all the questions we had today. So thank you, moderator, and thank you everyone online for your questions.
On behalf of Fortum, we wish you all a very nice rest of the day. Talk to you soon.
Thank you. Have a good day.
Thank you.
Bye.