Forsmark drags down Vattenfall

Swedish energy group Vattenfall reported on Thursday that net profits declined by 3.2 percent in 2006 owing to a fall in electricity prices at the end of the year and problems at a nuclear plant.

Vattenfall, which is state owned, said net profit totalled 19.86 billion kronor, a fall of 3.2 percent from the figure in 2005.

In the fourth quarter, net profit shrank by 35.0 percent on a 12-month basis to 6.61 billion kronor and operating profit fell by half to 5.22 billion kronor.

But in the whole year, sales rose by 12.9 percent to 145.81 billion kronor and in the last quarter sales rose by 9.6 percent.

The group said that the price of electricity had fluctuated widely during the year and that there had been a “substantial” fall during the fourth quarter.

It had also suffered a “substantial” loss of production of nuclear electricity because it had halted reactors at its Forsmark generator and because of technical problems.

Lost production had cost about 1.4 billion kronor.

On July 25, 2006, a cut in electricity supplies led to the temporary closure of the Forsmark 1 reactor because two of four emergency generators had not been triggered into action. The incident revealed other weaknesses in the electrical system.

Experts said a disaster had been narrowly averted, but Swedish authorities noted in a report in September that the incident had ranked only two on a danger scale of zero to seven.

At the beginning of February, two of the reactors at the power station were halted as a precaution after the discovery of a technical fault.

Nuclear energy accounts for nearly half of the electricity produced in Sweden, which plans to cease producing nuclear energy in about 30 years’ time.