The purpose of innovation in Statkraft is to develop and strengthen competitive advantages in the core activities, identify and promote new business development opportunities, engage in long-term expertise building and contribute to secure good future framework conditions for renewable energy production. In 2014, about NOK 124 million was expensed on various innovation and research activities.

Statkraft's innovation logic

All innovation activities are continuously followed up to ensure relevance and benefits. The following logic forms the basis for balancing investments between short-term and long-term innovation activities in the Group:

Improvement work addresses daily challenges and usually yields quick results. These projects focus on existing plants/ equipment and optimal resource utilisation.

Market innovations are associated with commercial services around energy production and deliveries which, along with technological innovation, represent a significant long-term competitive advantage. By focusing on development of new business models associated with existing activities, the ambition is to develop concepts with a short commercialisation lead time.

The Group’s research and development (R&D) programmes are associated with Statkraft’s core business areas and have a longer time perspective. Multiple-year R&D programmes have been established within hydropower, wind power, bio-energy and climate.

Research activities have been established with the purpose of evaluating and qualifying technologies and solutions which in the long term can form the basis for new insight or activity in Statkraft.

In order to support innovation projects and various processes/ projects associated with strategy, technology and markets, Statkraft also has extensive activities within technology analysis, covering all of the above categories. Global technology development in the energy sector is carefully monitored and analysed.

Value creation Statkraft follows up each innovation project with a view to value creation. Estimates show an average value potential of several times the project costs. “Effect evaluation” is a tool introduced in Statkraft to promote the investment capability and thus value creation of R&D projects in particular. Every project is evaluated twice; at start-up and completion. Particularly interesting projects are also followed up after completion to ensure sound implementation over time.

Relevant research activities Liquid biofuel is a research activity addressing the business opportunities in the bio-energy market. Specifically, the opportunities in connection with production of liquid fuel for road transport based on forest resources. Statkraft wants to use this opportunity to add to its basic bio-energy expertise.

Modelling within distributed energy is carried out with the purpose of establishing insight within technological and commercial potential, as well as increasing understanding of how distributed energy impacts Statkraft. Modelling of solar and batteries, combination of heat and power, as well as the consumption pattern of customers in the Nordic region were prioritised research activities in 2014. An assessment of various business opportunities related to a combination of solar cell panels and energy storage in the form of batteries has led to increased understanding for both the technological status and cost level.

There will be an increasing surplus of power in the Nordic countries up to 2020. However, electricity consumption may increase through electrification of the heating and transportation sector. Through using renewable energy, these sectors can also be de-carbonised, and an interaction between the sectors will lead to greater flexibility in the energy system overall.