Good morning, everybody. It's end of our fourth quarter and 2018 has just been finished. It's still dark in Norway, but I'm quite happy to say, and you probably know this, that Scatec Solar today is actually producing solar energy every hour of the day. We're having plants producing in Asia, in Europe and in America. As usual, we split the presentation into three. I take the first part, Mikkel will go through the financials, and I'll provide some input into the outlook and the summary. The last quarter has been exceptional in many ways for us. Operationally, we have performed very well, and we have reached our best financial results ever. The proportionate number came in at NOK 1.666 million in revenues within EBITDA of a little bit shy of NOK 330 million.
The high activity on the construction side manifests itself in a revenue of almost NOK 1.5 billion and with an EBITDA of NOK 202 million. The gross margin is slightly above what we have been guiding on, and that is expected. I mean, the variation, it's not always 15%. It could be below and it could be above. It was above this quarter. We have connected in the fourth quarter last year, projects or plants in Brazil and the first of three project in Malaysia. We've also started construction of a project in Argentina, a smaller one in Malaysia, and a couple of projects in Ukraine, totaling almost 250 MW. The board has proposed dividends to be at NOK 0.95 per share. If you look at the year as a whole, it has been a record year for us, in many ways.
We have seen a strong conversion from opportunities into our pipeline, inflow into pipeline, and also going into backlog and into construction. This is a confirmation of what we have previously shared with you, that the market remains strong. It will continue to remain strong, and it is strong in the areas of the world that where we have our, so to speak, target market. We had financial closure of 539 MW, and they all moved into construction. We also connected three solar plants that started earning revenue, totaling 262 MW. If you remember, last year at this point, we had 330 MW in operation. We are in a very strong growth mode at the moment, harvesting from the investments that we have done into development over the past years. If you look at the table to the right, you can see the development from 2016 to 2018.
The revenues has gone up more than four times the EBITDA, 260% or 2.6 x. As you have also monitored that the D&C revenues was quite high last year. In fact, we have never been above NOK 4 billion in revenues from the D&C segment ever. Gross margin as guided, we managed to get 15% gross margin. The year overall, in all parts, both developing new business, performance in terms of execution, has been running quite well. This is our portfolio. I guess what is unique about our business model is that we operate in different phases. The first phase is development and construction. Of course, we generate revenues and we generate margin there. The margin we generate there, we will take and invest into the long-term cash flows where we'll have contracts lasting from 20 to 25 years.
These are the projects that today are going to be operating and earning revenues over the next 20 to 25 years, although some of them have come a little bit further down their lifetime. Mikkel will show you a slide later on that the plant isn't finished and over with when you're done with your contractual life. In fact, it has a life after that. I think it's useful for you to also appreciate that because that is taken into account in our contracts. Now, we have more than or almost 1,100 MW in construction. In four continents, that's a challenge in itself. Our operating model is really being tested, but I think that we're doing well. Egypt, fantastic project, 400 MW in the middle of the desert. Here we are doing something that nobody has seen at this scale. We are actually implementing bifacial modules.
Bifacial means that we are actually producing electricity, not only from one side where the sunrise hits, but also from the underside. The sunrays are reflected from the ground or the desert, and it hits the bottom or the other side of the panel, boosting the yield. We can get up to 10% more yield from an installation like that. The 400 MW is the largest installation globally. South Africa, in the beginning of the three projects, up towards the Botswana border. Northern South Africa, Upington. Jasin and Merchang is left to be finished. We completed Gurun in December, and we are in the final rounds of finishing Jasin and Merchang.
There has been some execution issues there, but of course, those are reflected in our numbers, and we are well on our way in the final testing for these plants to be connected within a couple of months. Argentina, also quite early. This is a project that we are doing jointly with Equinor, 50/50. They're providing construction finance. I just want to reiterate in this context that if we didn't have this facility, we probably wouldn't have started the project so early. That's good. Ukraine, very interesting. Also here, Ukraine is sort of not down south. It's winter in Ukraine. We are progressing quite well. As you can see, a little bit snow on the ground. The ground is not too hard, we can actually penetrate the poles that will actually carry the panels.
Malaysia, this is a project that we won in a bidding phase, more than a year ago. That has also moved into construction. Mozambique is a couple of weeks away from completion. We're doing the final testing now, it will start earning revenue as well very soon. Mikkel, I think you should guide us through the numbers.
Thanks, Raymond. You've already mentioned it when it comes to the fourth quarter, I'll reiterate. NOK 1.7 billion of revenues across our segments, on a proportionate basis. EBITDA of NOK 329 million. It's basically revenues up fourfold since the same quarter last year, and EBITDA up almost threefold compared to last year. Construction activity is what is driving this. We have been, as you can see here, ramping up construction significantly during 2018, and we expect that to continue to be full revenue effects of this also into 2019, obviously, with a lot of work to be done on the construction portfolio. I would say that power production and EBITDA numbers are increasing in the fourth quarter. It's actually up 30% year-on-year, the EBITDA on power production with more now power sales.
Obviously, we will get more of this in the quarters to come. I will go through the segment results in a bit more detail in a couple of minutes. I just also wanted to highlight the annual numbers. NOK 4.7 billion of revenues for the year, up from NOK 1.7 billion last year and NOK 1.2 billion in 2016. We are on a growth trajectory, to say the least. EBITDA now reached, for the year, close to NOK 1 billion. Half of it from the construction activities, the other half from the power production segment and the sale of power. Again, we will sell power for the next 20 to 25 years under the PPAs. You'll see recurring business and growing business in that area. Of course, we will continue to construct power plants in the years to come.
On the guidance for 2018, we have delivered across the board. This is a slide we presented in January last year. We set out our targets for equity returns from D&C margins, but also for power production, cash flow to equity. We have basically delivered across all of these targets. We also upgraded our growth target in our capital markets day back in May last year, where we set a target of 3.5 GW by 2021. Raymond will also revert to how we see the market opportunities and prospects here in the last part of the presentation. Just briefly on the various segments. Revenues in the power production segment have reached NOK 180 million. EBITDA, NOK 139 million. It's really now a connection of Honduras, Brazil, and also Malaysia that created this increase.
Also the impact of us buying another 6% of the operating assets in South Africa impacted the quarterly numbers. Power production reached 108 GWh , up from 73 GW in the same period last year. This is brought in line with the guidance that we provided for the fourth quarter. For the full year, revenues reached NOK 622 million and EBITDA NOK 492 million. Moving on to O&M. It's a bit more fluctuating. It's a seasonality in this business. We have seen underlying fairly stable operations, but we do have some effects from the seasonal variations of performance in South Africa that are affecting the numbers in the fourth quarter. That's why you also see somewhat lower margin.
We also see some impact of us ramping up some OpEx for this segment in preparation for O&M services that we will provide for the new plants that will be grid connected in 2019. We'll see some improvements in these results as well, obviously, as we move forward. D&C revenues, NOK 1.5 billion. It's now across the projects that Raymond mentioned, we recognize revenue. Accumulated progress across the portfolio that is currently being built is 43% at the end of the fourth quarter. 15.9% gross margin. Moving on to the balance sheet. We have invested about NOK 1.7 billion of equity in 2018. I will talk a bit more about the cash movements, both in the quarter and for the year. The consolidated assets stood at close to NOK 15 billion at the end of 2018, up from NOK 10 billion a year ago.
It's driven by our CapEx investments. If you look at the cash and net debt levels, consolidated cash stood at NOK 3.3 billion, while we had NOK 1 billion of free cash at the group level. On top of that, we have an undrawn bank facility of NOK 500 million, which is giving us a robust and solid position to move forward with our projects. The group level book equity reached NOK 3.1 billion, and the equity to capitalization ratio stood at 81% at the end of the quarter. Now to the cash bridge. We received NOK 28 million of distributions from the operating power plants in the fourth quarter. We report NOK 157 million of cash flow to equity from the D&C segment.
This is measured based on the EBITDA that we report. We have a working capital component to the far right, which has a significant positive movement in this quarter, NOK 780 million. That's based on us reaching the milestones under the EPC contracts that we have in place. That basically is paid by the project companies to us. The project companies that we established, they draw on equity and on debt for the projects then pay us under the EPC contracts. We had a very positive movement on that front in the fourth quarter. We continue to invest equity into new projects, NOK 350 million in Malaysia, Argentina, and Ukraine. Again, NOK 1 billion of cash at the end of the year. If we look at this for the full year 2018, we received NOK 260 million of distributions from operating power plants.
The board has proposed to pay, this is in line with our dividend policy, to pay half of that cash as dividend to our corporate shareholders. That's the policy we have, 50% of whatever we distribute from our operating plans to be paid to the corporate shareholders. We have generated close to NOK 400 million of D&C cash flow to equity. We invested, as I mentioned, NOK 1.7 billion of project equity across our project portfolio. Again, we had a very positive movement on the working capital side, more than NOK 1 billion throughout that 2018. Short-term guidance. We expect the 2019 O&M revenues to increase to around NOK 110 million -NOK 120 million with an EBITDA margin of around 30%.
The margin levels are coming somewhat down to 2018 in this segment, as I mentioned, both due to somewhat higher OpEx also a lower underlying margin in the new contracts, the new O&M contracts that we have entered into for the portfolio that we now are realizing. The current project under construction represents a contract value of NOK 8.4 billion. The remaining value that's not been recognized here is about NOK 4.8 billion. Most of that we expect to be recognized in 2019. Obviously, as we reach financial close for new projects throughout 2019, we will also have additional revenue in this segment. When it comes to power production volumes, we provide you with the guidance on that in a table here. This is based on plans in operation at the end of last year.
Any grid connection, we will have grid connection, as you know, in most of our plants in 2019. That will add to these production volumes. Just to mention shortly also as well, we have implemented IFRS 16, the lease standard. It's implemented from 2019. We have some more information about this in our quarterly report. Basically, we are moving roughly NOK 20 million of OpEx. This is OpEx related to land lease and some office leases from OpEx to net finance in our P&L. You can get some more information and details on that in the report. Now, lastly, I wanted to touch upon and highlight a topic that we believe is important for you to understand really the underlying value of the asset portfolio. It's referred to the post-PPA value of our assets, basically.
We see it in the industry now being discussed quite a lot. As you know, we have Power Purchase Agreements covering 20-25 years. The technical life of the solar power plants is expected to be at least 35 years. We have secured land rights for at least 35 years. We have the opportunity to continue to sell power also after the end of the PPAs. The market power prices are expected to continue to increase, I think especially across the emerging markets where we operate and we have these plants. Obviously, after 20 years, the marginal cost of operating these solar plants are very limited. They're fully depreciated at that time. There's no debts related to these plants. Obviously, there's no fuel costs involved, and the cost of operating is limited.
Our ability to generate value from these plants also after the PPA ends is significant. I think also in the secondary market for assets, we see more and more value being attributed to this component. We wanted to highlight that because we think it's relevant also for the valuation of our assets. Raymond, I would want to give the word back to you.
Thank you. That's very kind of you. Yeah. Final lap, outlook and summary. I guess this is a topic that I've touched on for the past few years. Cost of solar energy continues to come down, that happened last year as well. There is something else happening right now. We're not above every other source of energy. We're at the moment at the bottom in terms of cost per kilowatt hour produced. If energy produced and the cost of it doesn't have any competition, it actually stimulates, motivates those that depend on electricity to carry out their business to look at solar in a different way. We see that allows us to sort of use our imagination, or rather, to talk to new customers, to listen carefully to them.
How can we actually generate a partnership together that will allow you to tap into this low cost of energy? It does something to the complete structure. I'm not going to use the word revolution, but if you follow this and try to remember my words, if you follow this over the next 5 - 10 years, you will see that there will be dramatic changes to the established structure on how energy companies, the industry, are actually approaching the subject. Before I move into the slide, I will debate a bit about it. Just let me dwell a few seconds on this slide. We have now reached 4,500 MW of pipeline. I would say this is a high-quality pipeline, and from last quarter, it is up 600 MW. We have become even more systematic when we are assessing opportunities.
For us, of course, every opportunity we look at that is a failed opportunity is something we shouldn't look at. Of course, not everything in this pipeline is going to transform themselves into a project that will be standing there producing electricity for the next 20 years. It's a very vibrant market at the moment, and our business team is extremely busy in our market segment that you see on this slide. Now back to what I just opened with. We see several and many market opportunities with corporate off-takers. There are different types of corporate off-takers. Some of them are big, some of them are small. If you look to the left there, it says wheeling.
Well, that means that you are using a grid highway to transport electricity, meaning that you can put a plant out into a rural area, and you can take out the electrons 200 km away where the user is. It's not the same electron that is being produced, but the way that the system is put together is that you can actually make a transaction that allows you to take out that electricity elsewhere. This is in operation in Europe. You know that you can actually buy hydropower type of electrons in Norway and take them out, lighting your house in Germany, for example. It's the way that the energy market is operated. This allows us actually to build solar plants where the land is cost competitive and then find customers, maybe corporate customers, elsewhere in that particular market. Extremely interesting.
Of course, you have to have a regulatory regime that allows you to do that. On the next one, that is what I call behind the meter production. It's like when you put a solar panel on your roof, you produce yourself, you store in a battery, and then you consume when you need it. Excess energy, if the utility company allows this, you can actually export and get some income from the utility. We are talking to many companies at the moment, large users in several big markets, where they really see that solar is going to give them a predictable power contract that will also secure their basic business that, some of them actually, the cost is up to 50% of the cost just for electricity payment. Here we also see an interesting market opportunity for us.
To the right, did you really know that 250 GW of power are being produced from diesel-generated engines in Africa? It's a massive amount. They're not buying at the level that we're selling power at, the $0.60 per KWh . They're paying $0.20, $0.25, $0.30 per KWh , the poorest people in the world. Is that right? No, it isn't. It doesn't make sense. Of course, now we can offer opportunities where you have distributed generation, maybe some batteries, maybe in harmony with an existing diesel generator, because you need to have baseload, so maybe you can optimize the system. In fact, we have developed optimization programs that allows us to actually tailor batteries and solar to diesel so that we can actually show them how much we're saving. This is a tremendous market.
Of course, in this instance, we're not talking about the typical debt financing that we're using for big plants. We will probably put and look at a platform financing that you can finance many plants under a different type of financing scheme. This is something that we're working on, and I hope that we'll be able to share some details about that later on. We complain about politicians to a certain extent. They're good too, but sometimes they're not showing the way. They're a bit slow out of the blocks when it comes down to renewable energy and that kind of thing. What we see here is that these are 100 leading companies, and there are many more in addition, but these are the initiating companies that have decided that all the electricity that they're going to buy is going to be 100% renewable.
This group has grown now to almost 200 companies, and you see on the right-hand side that many of these are in Europe, where you have a regulatory regime that I just talked about that allow you to distribute the electrons a bit more efficiently. You see also the growing, the emerging markets are going to follow suit. What does that do? Well, it tells the world that the serious companies are making up their mind on what to do. It has a different effect, too, because in the growing economies, they want investment. They want some of these companies and other companies to invest. When they come in and negotiate, they say, "Well, do you have renewable energy?" "No, we don't. We have some brown coal type of energy." "Well, sorry, man.
We're not investing." It actually will change the behavior of some of these politicians in those countries that are emerging, meaning that they will move quicker into renewables than they would have done otherwise. The good news is also that by doing that, they are actually producing electricity at a lower cost. Vietnam is a very, very good example. If you look at their energy plan, they had huge plans in establishing coal-produced power plants. This plan is now under revision, and it will be replaced to a large extent by renewable energy. Scatec Solar has a growing number of shareholders that are asking us about sustainability and how we fare.
I've decided that since this is sort of the yearly review or presentation as well, to share with you a couple of slides that gives you a bit of a view into our sustainability report that will also be published to the market along with the annual report. This is actually a part of how we drive our business. We work extremely closely with the local communities. On Honduras, you know that we had some issues there, and they were largely connected to a situation on the ground where we didn't truly comprehend on how to interface with the local community. We spent a lot of money to a certain extent, but more importantly, we spent a lot of time actually interfacing with the community and making sure that they could trust us.
I think I mentioned this before, some of them thought they would get cancer from solar panels, that the solar panels consumed all their water. Of course they didn't. Of course, this is the world that we're in. This has actually come out as a very successful initiative from us. In Mozambique, we also implemented a Livelihood Restoration Program, 220 household, and this is in line with IFC performance standards. Those are the standards that we apply to all our projects. All the projects that are being built together, we have 400 out of 2,000 MW on this location. Also here, we have spent a lot of time in actually bringing our performance and how we work on our programs up to a very high level or a high level. It has been a success.
In fact, I got the message this morning that we just passed another inspection because we are being inspected, and we're not doing this in isolation. Lenders, partners, everybody is making sure that, because they have the same interest, that we are performing well. 6 million hours, man hours or hours across 10 projects in 9 countries, was actually produced last year. Lost time incidents, three. That's three per 100,000 hours. We created 6,000 jobs. Some of these people will have learned a skill set that will allow them to earn income for their families later on as well. They've seen that in Africa or in South Africa, and maybe 80% of these 6,000 people were unskilled. They haven't worked before. We're used to HSE in the North Sea. You have blue collar, white collar, you have workers, you have office people.
Workers in Norway are different from unskilled workers in Africa or in South America. They haven't done it before. You need an extra effort to make sure that you're actually taking care of these people, so they don't get hurt. Now to this slide. Transparency is essential. That's why we have really, last year, increased our efforts into this area. We have signed an agreement to be a member of the UN Global Compact initiative. It covers human rights, labor, environment, and anti-corruption. Secondly, climate reporting. We are and this will be in May, report to the Carbon Disclosure Project. That is a standardized reporting platform. We cover all aspects of sustainability, and it will be available for you and every other stakeholder to look into. You should compare from year to year to see. You should expect us to improve.
We have, maybe as one of the first companies in Norway, we assigned to the U.N. sustainability goals. We have selected six or seven of those that we are actually comparing ourselves to. It is also covered well in our sustainability report. Finally, there was a ranking made by 100 largest listed companies in Norway. We ended up among the top 15, and we hope that we can actually move up on that list next time we're being evaluated. To the final slide. The performance, I think it has been a good performance, and the results, as Mikkel showed you, our financial results are very good. In operation, 584 MW. Under construction, as I've told you before, 1,071 MW, and backlog 225 MW. The pipeline has increased by 600 MW, and if you look to the right, we guided in June to be up to 3,500 MW in 2021.
We're up to 1,700 MW. We have to add to reach that goal or even outperform that goal, who knows, add another 1,800 MW to reach 3,500 MW. The 1,800 MW are going to come from projects that are in the 4,454 MW pipeline. It's about 1/3 that we have to bring into financial closure and build. Of course, the pipeline is not static. This pipeline, we just increased by 600 MW last quarter. It means that it's not going to be staying at this level. Hopefully there'll be movement and move into backlog construction. We have a backlog on the construction side of NOK 4.8 billion, as Mikkel said, on the D&C side. Of course, new projects that are being financially closed will move into construction and will add revenue to the D&C segment. Growth is essential for us.
In fact, these four blue bullets are the same bullets we showed as being the pillars for success over the next few years. We'll put in some information below that. Now on the third one, we're saying that 2019 for us is going to be a breakthrough year with regards to corporate PPAs. Finally, we have talked about this a few times before, looking at how to create additional value to optimize the financing of the asset portfolio and enhance value. It only makes sense for us to do that if we can actually create a value that is over and above what we would have expected. Of course, the larger and the more coordinated the portfolio is, the better chance you have to get a very good pricing for it. We're working on that as well.
I guess that concludes my presentation, and we are more than happy to take questions from you present here, and from the I almost said the grid. I mean the net. Yes.
Sorry.
[Casper Jessen], Kepler Cheuvreux. Congratulations on the very strong 2018. Just regarding the pipeline, right now, I guess it is about converting pipeline to backlog as well in 2018. You mentioned corporate PPAs. Could you just provide some color on the development of the South African pipeline and the Kazakhstan pipeline and the Vietnam pipeline?
What was the middle one?
The Kazakhstan.
To take the middle one first, the Kazakhstan pipeline is not really moving. We are not prioritizing Kazakhstan for the time being.
On Vietnam?
On Vietnam, we are working on several projects. I think Vietnam, as I just indicated, you will see a fairly strong growth within renewables due to the fact that they are in desperate need for more electricity, and they do not want to build too many more coal fire power plants. You should expect us to come up with some more projects there. That's a part of our pipeline. Projects in Vietnam is a part of our pipeline. With regards to South Africa, if you follow the South African news, which I do every day, Engineering News, by the way, is a good site. You see that they are just about to publish their new energy plan. The previous plan under President Zuma had nuclear. I think that has disappeared. Renewable will take a more prominent position. South Africa for us is a home market.
This is where we really made a difference by building the first project for Africa, the largest, and for ourselves. We have a big pipeline of projects, very competitive projects at the right locations, meaning that there is capacity on the grid to receive our electricity. For us, we're extremely hopeful. Good news from Davos from the Minister of Energy as well, being very positive about the energy situation in South Africa. They have an issue with Eskom that they have to sort out. That's not really our problem, really. Very optimistic.
Do you expect Round five to take place in 2019 in South Africa?
Yep.
Around Five.
I follow South Africa, I'm not a South African politician. They have to go through this. We think so. We didn't think so last year, in the beginning of last year, now we think so. It's been very good positive news flow from South Africa over the past few weeks.
The final question, is it possible to-
Mention some country names in the new 600 MW pipeline?
I'm sure it's possible. I'm sure it's possible. Maybe you should hold your horses a bit. There are a certain number of countries in the world, and
I think also to add, there is new opportunities within existing markets as well in that increment.
Thanks.
Thank you. Preben Rasch-Olsen, Carnegie. Interesting to hear more about the terminal value you see out there. Just a few questions. First, can you give us some reasoning behind why you think the market prices will continue up, given that all the new capacity coming on stream is really you and wind with declining prices? Also, what do you need to put into the plans to make them operate for 10 more years? What kind of CapEx should we expect for having 30 instead of 20 years of production?
The panels, they last. There are projections and even guarantees that go beyond the 20 original years, 25, 30 years. That is not my concern. What you would normally take as an operating cost is the inverters. They have a certain lifetime, and you have to replace them. You have to put that into it. Then, Mikkel may want to add something to your first question, and that is, we expect the power prices to go up. It doesn't mean that we assume that power prices should go up for us to make this a good business case. Our marginal cost is zero plus. It's not much. We think that we will be competitive with any other source of energy because we don't have a fuel cost.
We have a few guys running the plant, as you indicate, some inverter costs and that kind of thing. We will be very competitive. Remember, all the loans and everything else is paid off. We will be flexible. I think it is going to be quite profitable, but that is yet to be proven.
Yeah, I know. I was just going to say that, of course, we agree that there will be a lot of growth in solar and wind in the years to come, the question is, of course, what will be the technology then? Setting the price of power in any given market in 20 years is, of course, a bit challenging to answer that question. There will be Of course, we believe that we are not going to set the price with our portfolio or with the solar. That will probably not be the price setter.
We also see, I think you mentioned, we see transactions out there in the market where the life after the initial PPA is actually put into as an element in pricing. In fact, that was done when we sold our Utah plant.
Sindre Sørbye from
Hi. Sindre Sørbye from Arctic Fund Management. Corporate PPAs, can you give us some more flavor on when can we expect some news, in which geographies, and the magnitude of those projects typical, how much could they move the needle financially?
I'm not sure if I want to share with you where we're actually negotiating. They are in fairly substantial markets. The contracts may be in between 50 MW-200 MW. They are substantial. I mean, utility scale. The difference here is that in the past, we have said, okay, there is a PPA, there is a 20-year period. There you go. We don't really need to understand the customer. We just need to understand that they will be able to actually take the electricity we produce and distribute it to whoever consumes. When you talk about corporate PPAs, you have to listen carefully to the needs of your customer. Number one, they may not want to enter into a 25-year contract. They may have a different business cycle that they're in. You have to understand that.
There could be tax or write-off situations. There could be particularities linked to that company that drives their decision behavior when they're moving into a contract. Also you have to show them some comfort with regards to how the general market is going to or is expected to behave when you're entering into a contract. Putting all that into perspective and then implementing it in an agreement that we could live with and that they can live with is a challenge. I think we have found ways to do that. It will vary from customer to customer. The PPAs will also not be 20 years. It's probably shorter. You could have an element of hedging there. Different things that is going to reduce our risk, but still give the customer the opportunity and some flexibility when they're entering into a contract with us.
We have a question from the web from Petter Nystrøm in ABG. How should we expect working capital to develop in the first half of 2019 and for the full year 2019?
We will continue to be very active on the construction front throughout 2019, as I mentioned, and of course, also in the years to come. Specifically on the first half of 2019, I think we'll be fairly stable from a working capital perspective. Probably some reversal of some of those positive movements we've seen later in 2019. That would be how we see things at the moment.
Thank you. [Per Vatle] from [Noric]. Back to the corporate PPAs. A few companies, they argue that if you are producing our own power, it can be in different country, and then in effect, we will be energy neutral. Based on your discussions, would you say that your discussions are with clients that would like to produce in a physical way? Like it's the same amount that we produce and we use, or would it be more flexible? Do you understand the question?
Let me try. Then you can correct me if I missed the point. You can have a facility that produces more than the one that you enter into the contract with is requiring. That's a part of the picture. You will be able to sell a part of that to the open market. You have to understand how that behaves, and you put that into the model. You risk it as well. I'm not sure if that's what you asked about.
It's about how willing are they to take on more amount than they use physically at that site. Does it have to be a link between, they can have consumption in Europe and then in Asia. If they build one big plant in Africa then, the net position on energy will be neutral. Energy neutral for that plant. Where is more physical links?
The regime isn't like you can exchange electrons from Africa to Australia. I think on a carbon, what do you call it? Carbon regnskap. Accounting.
Yeah.
If you are reporting as a company, how you are actually, if you're carbon neutral globally, of course you can add those up as a management account, you can't really at the operating level get the same kind of thing. Yes, you can get benefits from that, and I think a lot of companies do.
Thank you.
Thank you.
Okay. It doesn't look to be any further questions, so thank you.
Thank you very much for your attendance.