IPE Real Assets
A consortium led by hydropower producer Hafslund Eco has bought Norway’s largest district heating provider for NOK20bn (€2bn).
Hafslund Eco, which is owned by the City of Oslo, has partnered with infrastructure investor Infranode and Norwegian asset manager HitecVision to buy Fortum Oslo Varme, a business jointly owned (50/50) by European energy group Fortum and the City of Oslo.
As part of the deal, the City of Oslo will transfer its 50% stake in Fortum Oslo Varme to Hafslund Eco.
Hafslund Eco will become the majority owner with 60% ownership in Fortum Oslo Varme, while Infranode and HitecVision will each hold a 20% stake.
Fortum Oslo Varme delivers sustainable district heating and power to commercial and residential properties throughout Oslo, providing heating and hot water to more than 200,000 people.
Martin S Lundby, deputy CEO and EVP for growth and investments at Hafslund Eco, said the firm’s plan is to realise carbon capture in Oslo.
“Through the agreement, we increase our annual energy production by almost 2TWh and ensure ownership of critical infrastructure that provides essential services for Oslo’s inhabitants.
“District heating has operational and ownership synergies with hydropower and operates in the same power market. As an owner, Hafslund Eco has a lot of expertise to contribute within that area,” Lundby said.