FORTUM Power and heat company in the Nordic area, Russia, Poland and the Baltics Investor / Analyst material December 2014

2

Disclaimer

This presentation does not constitute an invitation to underwrite, subscribe for, or otherwise acquire or dispose of any Fortum shares. Past performance is no guide to future performance, and persons needing advice should consult an independent financial adviser.

Content

3

Fortum today pages 4 – 18

European and Nordic power markets pages 19 – 30 Data on Fortum’s nuclear fleet pages 31 – 35 Russia pages 35 – 40 Data on capacity payments pages 38 – 39 Fortum’s investment programme page 40 Financials and outlook pages 41 – 46 Hedges pages 47 – 48 Efficiency programme page 49 Facts of Distribution page 50

Appr. 110,000 shareholders

• Power and heat company in the Nordic countries, Russia, Poland and the Baltics • Listed at the Helsinki Stock Exchange since 1998 • Among the most traded shares on the NASDAQ OMX Helsinki stock exchange • Market cap ~18 billion euros

4

30.11.2014

Foreign investors 32.5% Finnish State 50.8%

Other Finnish investors 7.0%

Households 8.2% Financial and insurance institutions 1.5%

Capital returns : 2013 EUR 1.10 per share ~ EUR 1.0 billion

• Fortum’s dividend policy is based on the following preconditions: – The dividend policy ensures that shareholders receive a fair remuneration for their

entrusted capital, supported by the company’s long-term strategy that aims at increasing earnings per share and thereby the dividend.

– When proposing the dividend, the Board of Directors looks at a range of factors, including the macro environment, balance sheet strength as well as future investment plans.

5

5 year dividend per share (EUR) history

Fortum Corporation's target is to pay a stable, sustainable and over time increasing

dividend of 50-80% of earnings per share excluding one-off items

Fortum has since 1998 annually paid dividends

in total ~10,493 MEUR

1.1 1.0 1.0 1.0 1.0

Fortum Executive Management

6 Country responsibles: Timo Karttinen/Finland, Norway; Per Langer/Sweden;

Alexander Chuvaev/Russia; Markus Rauramo/Poland, Baltics, India

Human Resources and IT Senior Vice President

Mikael Frisk

Finance Chief Financial Officer

Timo Karttinen

Strategy and M&A Senior Vice President

Kari Kautinen

Communications Senior Vice President

Helena Aatinen

Corporate Relations Senior Vice President

Esa Hyvärinen

Legal General Counsel

Sirpa-Helena Sormunen

Business Divisions

Corporate Staff Functions President and CEO Tapio Kuula

Chief Operating Officer

Matti Ruotsala

Distribution Executive Vice

President Timo Karttinen

Russia Executive Vice

President Alexander Chuvaev

Nuclear and Thermal Power

Executive Vice President

Tiina Tuomela

Hydro Power and Technology

Executive Vice President

Per Langer

Heat, Electricity Sales and Solutions

Executive Vice President

Markus Rauramo

Fortum’s Mission and Strategy

7

Strategy

Fortum’s purpose is to create energy that improves life for present and future generations. We provide sustainable solutions for society and deliver excellent

value to our shareholders.

Mission

Build on the strong Nordic core

Create solid earnings growth in Russia

Build a platform for future growth

Strong competence in CO2-free hydro and nuclear, efficient CHP production and energy markets

Our geographical presence

8

* incl. Fortum Värme; power generation 1.3 TWh and heat sales 8.2 TWh.

OAO Fortum Power generation 20.0 TWh Heat sales 24.2 TWh

Russia

Poland Power generation 0.6 TWh Heat sales 4.0 TWh

Baltic countries Power generation 0.5 TWh Heat sales 1.1 TWh

Nordic countries Power generation* 46.5 TWh Heat sales* 13.9 TWh Distribution customers in Sweden 0.9 million Electricity customers 1.2 million

Power generation

Electricity sales

Heat

Distribution

Key figures 2013 Sales EUR 5.3 bn Operating profit EUR 1.5 bn Balance sheet EUR 23 bn Personnel 9,200

Great Britain (Sold in Oct ‘14)

Power generation 1.0 TWh Heat sales 1.8 TWh

India Power generation ~9 GWh

In addition, ~29% share in TGC-1

Fortum’s reporting segments and divisions

9

Distribution • Electricity distribution

activities

Russia • Power and heat

generation and sales in Russia

• Includes OAO Fortum and Fortum’s slightly over 29% holding in TGC-1

Power and Technology • Hydro, nuclear and

thermal power generation • Power Solutions with

expert services • Portfolio management and

trading • Technology and R&D

functions The segment incorporates two divisions: • Hydro Power and

Technology • Nuclear and Thermal

Power

Heat, Electricity Sales and Solutions • Combined heat and

power (CHP) production • District heating activities

and business to business heating solutions

• Solar business • Electricity sales and

related customer offering • Corporate Sustainability

Fortum is a mid-sized European power generation player; major producer in global heat (incl. Fortum Värme)

10

* incl. MOEK, ** incl. Bashkirenergo, *** incl. TGC-5, TGC-6, TGC-7, TGC-9, **** incl. TGC-12, TGC-13, ***** figure 2011, Fortum incl. Fortum Värme; power generation (1.2 TWh) and heat production (8 TWh). Source: Company information, Fortum analyses, 2012 figures pro forma, heat production of Beijing DH not available.

Largest global producers, 2012 TWh

Largest producers in Europe and Russia, 2012 TWh

Power generation Heat production Electricity customers in EU, 2012

Millions

Customers

DEI

EuroSibEnergo Iberdrola

Fortum

EnBW

Vattenfall

CEZ

RWE

***) IES

DTEK PGE

Rosenergoatom

NNEGC Energoat.

Enel E.ON EDF

GDF SUEZ

Statkraft

Gazprom *)

RusHydro Inter RAO UES **)

0 100 200 300 400 500 600

KDHC, Korea

Quadra

Tatenergo

Minskenergo

DTEK, Ukraine

EuroSibEnergo

TGC-2

Fortum

Dong Energy

TGC-14

Lukoil

Sibgenco ****)

***) IES

Vattenfall

PGNiG

Inter RAO UES **)

ELCEN. *****)

RusHydro

Dalkia

Gazprom *)

0 20 40 60 80 100 120 140

GDF SUEZ

DEI

CEZ

Enel

Centrica

EDP

Iberdrola

SSE EnBW

Fortum

EDF E.ON RWE

Gas Natural Fenosa

PGE Tauron

Hafslund Dong Energy

Vattenfall

0 20 40 10 30

Biggest nuclear an hydro generators in Europe and Russia

11

Figures 2012 pro forma * incl. Fortum Värme (CHP 1.2 TWh), ** incl. MOEK, *** incl. Bashkirenergo, **** incl. TGC-5, TGC-6, TGC-7, TGC-9

TWh

Total generation

050

100150200250300350400450500550600

EDF

Ros

ener

goat

om

NN

EG

C E

nerg

oato

m

Rus

Hyd

ro

Vatte

nfal

l

E.O

N

Enel

Euro

SibE

nerg

o

GD

F SU

EZ

Stat

kraf

t

Fortu

m

Iber

drol

a

RW

E

EnBW CE

Z

Axpo

Verb

und

Gaz

prom

Hid

roel

ectri

ca

Cen

trica

Alpi

q

E-C

O E

nerg

i

Ukr

hydr

oene

rgo

Nor

sk H

ydro

EPS,

Ser

bia

BKK

Agde

r Ene

rgi

EDP

Gas

Nat

ural

Fen

osa

DE

I

SSE

Inte

r RAO

UE

S

PGE

DTE

K

IES

Other

Nuclear

Hydro

**

****

***

*

Fortum a forerunner in sustainability

• Nordic Climate Disclosure Leadership Index (CDLI)

• SAM Sustainability Yearbook

• STOXX® Global ESG Leaders indices

• oekom

• OMX GES Sustainability Finland Index

• ECPI® Indices

12

0

200

400

600

800

1000

1200

DE

I

Dra

x

RW

E

SS

E

ED

P

E.O

N

Vat

tenf

all

Ene

l

Edi

pow

er

Uni

on F

enos

a

CE

Z

EnB

W

GD

F S

UE

Z

Don

g E

nerg

y

Iber

drol

a

Fortu

m to

tal

ED

F

Ver

bund

Fortu

m E

U

PV

O

Sta

tkra

ft

42

g CO2/kWh electricity, 2012

2013 63% of Fortum's total power generation CO2-free 88% of Fortum’s power generation in the EU CO2-free Close to 100% of the ongoing investment programme in the EU CO2-free

Average 350 g/kWh

171

Fortum's carbon exposure among the lowest in Europe

13

Note: Fortum’s specific emission of the power generation in 2013 in the EU were 70 g/kWh and in total 202 g/kWh. Only European generation except “Fortum total“ which includes Russia.

Source: PWC & Enerpresse, November 2013 Climate Change and Electricity, Fortum

Our strategic route

14

Birka Energi 50% → 100%

Østfold

Shares in Lenenergo

Shares in Hafslund

Gullspång

Neste

Divestment of non-strategic heat business

Oil business spin-off

2007

Skandinaviska Elverk

Länsivoima 45% → 65%

Birka Energi 50% Fortum 50% Stockholm Gullspång merged with Stockholm Energi

E.ON Finland

TGC-10

District heating in Poland →

Divestment of Fingrid shares

Divestment of heat operations outside of Stockholm

TGC-1 established

Divestment of Lenenergo shares

1996

IVO Fortum

Divestment of small scale hydro

2012 2008 2006

1997

Lenenergo shares →

Stora Kraft

Länsivoima →100%

2000

Elnova 50% → 100%

2003 2005

2011

1998 2002

Divestment of electricity distribution and heat businesses

Divestment of electricity distribution business

Divestment of Grangemouth power plant

Divestment of Gasum shares

2014

15

Fortum in the Nordic electricity value chain Competitive businesses

Regulated businesses

Power generation Nordic wholesale market

Power exchange and bilateral agreements

Large customers

Retail customers

Private customers, small businesses

Independent transmission system

operator

Independent distribution companies Distribution Transmission and

system services

Fortum's power and heat production by source

16

Natural gas 29%

Nuclear power 35%

Coal 7%

Biomass 2%

Total generation 68.7 TWh (Generation capacity 15,128 MW)

Hydro power 26%

Fortum's power generation in 2013

Other 1%

Total production 42.8 TWh (Production capacity 21,659 MW)

Fortum's heat production in 2013

Oil 1%

Waste 5% Heat pumps, electricity 7%

Peat 1%

Biomass 12%

Natural gas 61%

Coal 13%

Incl. Fortum Värme; power generation 1.3 TWh (capacity 610 MW) and heat production 8.2 TWh (capacity 3,626 MW).

Nuclear power 48%

Coal 7%

Other 2%

Hydro power 37%

Natural gas 3%

European generation 48.7 TWh (Generation capacity 10,873 MW)

Fortum's European power generation in 2013

Biomass 3%

European production 18.6 TWh (Production capacity 8,193 MW)

Fortum's European heat production in 2013

Peat 2% Oil 1%

Heat pumps, electricity 16%

Waste 12%

Coal 22%

Natural gas 19%

Biomass 28%

Fortum's European power and heat production

17

Incl. Fortum Värme; power generation 1.3 TWh (capacity 610 MW) and heat production 8.2 TWh (capacity 3,626 MW).

18

Fortum’s Nordic generation capacity

MW Finland

Wind 0.4

Hydro 1 500 Nuclear 1 460 CHP 438 Other thermal 1 127

4 525 Generation capacity in Finland

1 139

4 590

Other thermal

Hydro Nuclear CHP *

3 276

Wind 30

Nordic capacity 10 083

1 048

Nordic MW Price areas MW

SE2 Hydro 1 550 Wind 30

SE3 Hydro 1 540 Nuclear 1 816

Sweden

5 558 Generation capacity in Sweden

Other 12 CHP * 610

SE1

SE2

SE3

SE4

31 March 2014 * incl. Fortum Värme 610 MW

Market coupling milestones - cross-border power flows optimised by power exchanges • Market coupling between NL, BE and FR since 2006 • Germany – Nord Pool Spot coupling started 11/2009 • Market coupling for Central Western Europe (DE, FR, NL, BE)

since 11/2010 with a continued coupling with Nord Pool Spot • NorNed cable (NO-NL) included in January 2011. • Poland coupled with Nord Pool Spot since December 2010 • UK coupling started through BritNed cable in April 2011 • Estonian price area in Nord Pool Spot since 2010 and

Lithuanian area since 6/2012. Latvia joined in June 2013 • Czech, Slovakia and Hungary coupled together since

September 2012. Romania joined 19 November 2014 • A common day-ahead market coupling for the whole north-

western Europe was started 4 February 2014. Iberia (Spain & Portugal) joined 13 May 2014. Italy and Slovenia are due to join in February 2015

• CEE market coupling region to join in 2016, with flow-based cross-border capacity allocation for further trade optimisation

• In addition to day-ahead coupling, intraday market coupling and balancing market integration under development as well

19

2009

2/2014

2012-2014

2010-2013

2015-16

5/2014

Current transmission capacity from Nordic area is over 5000 MW

20

• Theoretical maximum in transmission capacity ~40 TWh per annum

• Net export from Nordic area to Continental Europe and Estonia during the Nordic dry year 2013 was 3 TWh

• During 2012 net export was 18 TWh • Approximately 25 TWh of net export is now reachable

Countries Transmission capacity MW

From Nordics To Nordics

Denmark - Germany 2,225 2,100

Sweden - Germany 615 600

Sweden - Poland 600 600

Norway - Netherlands 700 700

Finland - Estonia 1000 1,016

Finland - Russia 350 1,300

Total 5,490 6,316

700

2,225 615 600

1000

350

Nordic, Baltic and Continental markets are integrating – interconnection capacity will double by 2020

21

Two 1400 MW NO-UK links as EU Projects of Common Interest: NSN link to England agreed to be built by 2020, NorthConnect to Scotland still requiring Norwegian permission

First direct 1,400 MW NO-DE link agreed to be built by 2018

EU financial support for a 700 MW DK-NL link, due to be built by 2019

Jutland – DE capacity planned to grow by 860 MW by 2019, with further 500 MW increase by 2022

Svenska Kraftnät agreed 3/2014 with 50Hertz to study a new Hansa PowerBridge DC link between Sweden and Germany

The Northern Seas Offshore Grid and the Baltic Energy Market Integration Plan are included as priority electricity corridors in EU’s Infrastructure Guidelines, approved in April 2013

New interconnections will double the export capacity to over 10,000 MW by 2020

LitPol Link (500+500 MW) to connect the Baltic market to Poland by end-2015/20. It will open a new transmission route from the Nordic market to the Continent

EU’s European Energy Programme for Recovery co-financing 700 MW NordBalt (ready 12/2015)

New internal Nordic grid investments provide for increased available capacity for export to the Continent and Baltics

350 MW of export capacity from Finland to Russia available from December 2014

EU’s Connecting Europe Facility co-financing 3rd EE-LV transmission line, due to be ready by 2020

Q1 Q2 Q3 Q4

20

40

60

80

100

120

rese

rvoi

r con

tent

(TW

h)

0

2000 2003 2013 2012 reference level 2014

Nordic water reservoirs

22

Source: Nord Pool Spot

Nordic year forwards

23

Source: NASDAQ OMX Commodities Europe

Year 15 Year 17 Year 19 Year 10 Year 11 Year 12 Year 13 Year 14 Year 16 Year 18

0

10

20

30

40

50

60

70

€/MWh 1 December 2014

2014

Q1

2008

Q2 Q3 Q4 Q1

2009

Q2 Q3 Q4 Q1

2010

Q2 Q3 Q4 Q1

2011

Q2 Q3 Q4 Q1

2012

Q2 Q3 Q4 Q1

2013

Q2 Q3 Q4 Q1 Q2 Q3 Q4

Wholesale price for electricity

24

Source: Nord Pool Spot, NASDAQ OMX Commodities Europe

0

10

20

30

40

50

60

70

80

90

100

110EUR/MWh Nord Pool Spot System Price Forwards

1 December 2014

1995 1997 1999 2001 2003 2005 2007 2009 2011 2013 2015 2017 2019 2021 2023

Wholesale prices for electricity

25

Source: Nord Pool Spot, NASDAQ OMX Commodities Europe, APX-ENDEX, Bloomberg Finance LP, ATS, NP “Market Council”, Fortum

* Including weighted average capacity price

10

20

30

40

50

60

70

80

90

100

110

2008 2009 2010 2011 2012 2013 2014 2015

Dutch

German

Nordic

Russian*

Spot prices Forward prices EUR/MWh

1 December 2014

2016 0

0

30

60

90

120

150

USD

/ bb

l

Crude oil price (ICE Brent)

2006 2007 20102008 2009 20122011 2013 2014 20150

7

14

21

28

35

EUR

/ tC

O2

CO2 price (ICE ECX EUA)

2006 2007 20102008 2009 20122011 2013 2014 2015

0

50

100

150

200

250

USD

/ t

Coal price (ICE Rotterdam)

2006 2007 20102008 2009 20122011 2013 2014 20150

20

40

60

80

100

GB

p / t

herm

Gas price (ICE NBP)

2006 2007 20102008 2009 20122011 2013 2014 2015

26

Source: ICE

Market prices 1 December 2014; 2014-2015 future quotations

Fuel and CO2 allowance prices

Nordic power generation – dominated by hydro, but fossil needed

27

Source: ENTSO-E Statistical Factsheet 2013 *) Normal annual Nordic hydro generation 200 TWh, variation +/- 40 TWh.

0

20

40

60

80

100

120

140

160

Denmark Norway Sweden Finland

Fossil fuels

Nuclear

Biomass

Wind

Hydro *

TWh/a

Total Nordic generation 383 TWh in 2013

Net export in 2013: 0.4 TWh

23

86

TWh %

48

203

23

6

23

13

53

6

Wholesale electricity price too low to attract investments

28

0102030405060708090

100110

Source: Nord Pool spot, NASDAQ OMX Commodities Europe

EUR/MWh

Futures 1 December 2014

1995 2014 2024 0

102030405060708090

100110

Onshore wind

Nuclear Utility scale Solar PV In Italy

Large hydro

Offshore wind

EUR/MWh

Average levelised costs of new electricity generation

Coal condensing

Gas

NOTE: The presented figures are calculated based on data from recent public reports and do not represent Fortum’s view. Average achieved price (€/MWh) for the production type depends on availability and flexibility. There are large variations in the cost of hydro, wind and solar depending on location and conditions. Commodity prices are forward prices as of August 2014.

Still a highly fragmented Nordic power market

29

* incl. Fortum Värme (1.2 TWh). Source: Fortum, company data, shares of the largest actors, pro forma 2012 figures.

Power generation 406 TWh

>350 companies

Electricity distribution 15 million customers

~500 companies

Electricity retail 15 million customers

~350 companies

Vattenfall

33% Statkraft

Dong Energy

Others

Fortum *

E.ON PVO E-CO Energi

Agder Energi

Norsk Hydro

BKK

Others

52%

E.ON

Vattenfall

Fortum

Dong Energy

Göteborg, DinEl

SEAS-NVE

Hafslund

Helsinki Statkraft

Bixia

Fortum

Caruna

Others

56%

SEAS-NVE Helsinki Göteborg

Elenia

Vattenfall

E.ON

Hafslund

Dong Energy

New power generation capacity needed for increasing demand and retiring capacity replacements

30

• Growing global energy demand will be increasingly fulfilled by electricity in the future

• Substantial demand growth in the emerging markets

• Retirements and moderate demand growth in the EU

• Globally, ~7 000 GW of new capacity needed by 2040

Source: IEA WEO 2014 (New polices scenario) 1) Total new capacity needed for increasing demand and replacements of retiring capacity

479

257

736

632

354

986

172

72

244

281

1435

1716

91

814

905

787

1833

2620

2442

4765

7207 New capacity, total (1

Capacity changes, 2014-2040 (GW)

Retiring capacity

Capacity increase

19%

41%

114%

225%

0%

50%

100%

150%

200%

250%

US Europe Russia China India Other areas

World total

Growth, 2012-2040 Primary energy demand Electricity generation

Overview of Fortum’s nuclear fleet

31

LOVIISA OLKILUOTO OSKARSHAMN FORSMARK

Commercial operation started

Unit 1: 1977 Unit 2: 1981

Unit 1: 1978 Unit 2: 1980 Unit 3: (Under construction)

Unit 1: 1972 Unit 2: 1974 Unit 3: 1985

Unit 1: 1980 Unit 2: 1981 Unit 3: 1985

Generation Capacity Fortum’s share

Unit 1: 496 MW Unit 2: 496 MW Total: 992 MW

Unit 1: 880 MW Unit 2: 880 MW (Unit 3: 1,600 MW) Total: 1,760 MW (3,360) 27% 468 MW

Unit 1: 473 MW Unit 2: 638 MW Unit 3: 1,400 MW Total: 2,511 MW 43% 1,089 MW

Unit 1: 984 MW Unit 2: 1,120 MW Unit 3: 1,170 MW Total: 3,274 MW 22% 720 MW

Yearly production Fortum’s share of production

8 TWh 8 TWh

14 TWh 4 TWh

17 TWh 7 TWh

25 TWh 5.5 TWh

Share of Fortums Nordic production 18% 9% 16% 13%

Majority owner Fortum’s share

Fortum

Pohjolan Voima 26.6%

E.ON 43.4%

Vattenfall 22.2%

Operated by Fortum Teollisuuden Voima (TVO) OKG Aktiebolag Forsmarks Kraftgrupp

Responsibilities Loviisa: Fortum is the owner, licensee and operator with all the responsibilities specified in the Nuclear Energy Act, Nuclear Liability Act, and other relevant nuclear legislation Other units: Fortum is solely an owner with none of the responsibilities assigned to the licensee in the nuclear legislation. Other responsibilities are specified in the Companies Act and the Articles of Association and are mostly financial.

Olkiluoto

Loviisa Forsmark

Oskarshamn

Fortum's nuclear power in the Nordics

32

• Finnish units world class in availability • Overview of production and consumption:

www.fortum.com/investors - energy related links

Source: Fortum

Load factor (%) 2005 2006 2007 2008 2009 2010 2011 2012 2013

Osakarshamn 1 80 51 63 85 68 77 72 1 13

Oskarshamn 2 90 78 76 86 75 90 77 81 33

Oskarshamn 3 85 95 88 70 17 31 75 69 77

Forsmarks 1 85 76 81 81 88 93 79 88 87

Forsmark 2 94 72 85 79 64 39 94 82 89

Forsmark 3 95 92 88 69 86 81 85 93 88

Loviisa 1 95 93 94 86 96 93 94 84 92

Loviisa 2 95 88 96 93 95 89 94 91 93

Olkiluoto 1 98 94 97 94 97 92 94 90 97

Olkiluoto 2 94 97 94 97 95 95 90 96 93

Variety of technologies and ages

33

Planned capacity increases

• Oskarshamn 2 in 2017, capacity increase 180 MW (Fortum’s share 78 MW), Fortum’s share of total capacity after increase 355 MW

• Forsmark 1 in 2017-2020, capacity increase 120 MW (Fortum’s share 27 MW), Fortum’s share of total capacity after increase 257 MW

PWR = Pressurized Water Reactor The most common reactor type in the world (e.g. all French units, most US units). Also the Loviisa units are PWRs, but based on Russian design. High pressure prevents water from boiling n the reactor. The steam rotating the turbine is generated in separate steam generators.

BWR = Boiling Water Reactor Similar to the PWR in many ways, but the steam is generated directly in the reactor. Popular reactor type e.g. in Sweden, the US and Japan.

*Generation refers to technical resemblence based on KSU classification and not to reactor design generations. All reactors are of Generation II except Olkiluoto-3 (EPR) which is of Generation III.

Unit Mwe (Net) Share (%) Share (Mwe) Commercial operation

Age Type/ Generation *

Supplier

Loviisa 1 Loviisa 2

496 496

100,0 100,0

496 496

1977-05-09 1981-01-05

36 33

PWR / 1 PWR / 1

AEE (Atomenergoexport) AEE (Atomenergoexport)

Olkiluoto 1 Olkiluoto 2 Olkiluoto 3

880 880

(1,600)

26,6 26,6 25,0

234 234

(400)

1979-10-10 1982-07-10

(?)

34 31

BWR / 3 BWR / 3 PWR / 3

Asea-Atom / Stal-Laval Asea-Atom / Stal-Laval

Areva / Siemens

Oskarshamn 1 Oskarshamn 2 Oskarshamn 3

473 638

1,400

43,4 43,4 43,4

205 277 607

1972-02-06 1975-01-01 1985-08-15

42 39 28

BWR / 1 BWR / 2 BWR / 4

Asea-Atom / Stal-Laval Asea-Atom / Stal-Laval Asea-Atom / Stal-Laval

Forsmark 1 Forsmark 2 Forsmark 3

984 1,120 1,170

23,4 23,4 20,1

230 233 236

1980-12-10 1981-07-07 1985-08-18

33 32 28

BWR / 3 BWR / 3 BWR / 4

Asea-Atom / Stal-Laval Asea-Atom / Stal-Laval Asea-Atom / Stal-Laval

Third party nuclear liability in case of severe accident

34

Sweden (new, not in force)

Finland, temporary legislation

Current, Sweden

700 M€

200 M€ 360 M€

500 M€ Responsibility of company (insurance or guarantee)

Unlimited company responsibility Convention parties 300 M€

State responsibility

300 M€

500 M€

700 M€

New Paris convention

700 M€

145 M€

145 M€

Old, Finland

240 M€

145 M€

In force since 1.1.2012.

Law approved by Parliament in 2010, requires separate decision from Government to come into force.

Requires ratification by 2/3 of member states to come into force. In Finland approved by Parliament in 2005

Russia is the World’s 5th largest power market

35

Power generation in 2013 based on gross output. Source: BP Statistical Review of World Energy June 2014

0

1,000

2,000

3,000

4,000

5,000

6,000 TWh

Fortum - a major player in Russia

OAO Fortum (former TGC-10) • Operates in the heart of Russia’s oil and gas producing region, fleet

mainly gas-fired CHP capacity • 20 TWh power generation, 24 TWh heat production in 2013;

more than Fortum’s Nordic heat sales (14 TWh, incl. Fortum Värme) • Investment programme to add 85%, almost 2,400 MW to power

generation capacity

TGC-1 • Slightly over 29% of territorial generating company TGC-1 operating

in north-west Russia • ~7,200 MW electricity production capacity (more than 40% hydro),

~27 TWh electricity, ~29 TWh heat in 2013

36

OAO Fortum

Tyumen

Tobolsk

Chelyabinsk

Nyagan

TGC-1

St. Petersburg

Moscow

37

Day ahead wholesale market prices – increase driven by recovering demand and gas price

Key electricity, capacity and gas prices in the OAO Fortum area

III/14 III/13 I-III/14 I-III/13 2013 LTM

Electricity spot price (market price), Urals hub, RUB/MWh

1,164 1,136 1,105 1,013 1,021 1,090

Average regulated gas price, Urals region, RUB 1000 m3

3,362 3,327 3,362 3,029 3,131 3,378

Average capacity price for CCS ”old capacity”, tRUB/MW/month

150 149 162 158 163 166

Average capacity price for CSA ”new capacity”, tRUB/MW/month

499 507 535 550 576 557

Average capacity price, tRUB/MW/month

276 251 294 258 276 302

Achieved power price for OAO Fortum, EUR/MWh

31.5 33.8 31.5 31.6 32.1 31.9

0

200

400

600

800

1 000

1 200

1 400

RU

B /

MW

h

0

5

10

15

20

25

30

35

40

€/ M

Wh

Day ahead power market prices for Urals

In addition to the power price generators receive a capacity payment. Source: ATS

2008 2009 2010 2011 2012 2013 2014

2008 2009 2010 2011 2012 2013 2014

Power market liberalisation – two markets

38

Capacity wholesale market Electricity wholesale market

Capacity prices • Competitive capacity selection (CCS) and free bilateral

agreements (FBA)

• A higher, fixed capacity price for new capacity (CSA* agreements, built after 2007)

• Lower capacity price for old capacity, price caps limits the price in some areas

• Old capacity intended for households are priced by regulated bilateral agreements (RBA)

Electricity prices • Day ahead (spot) market, financial market, free bilateral

agreements (FBA) and regulated bilateral agreements (RBA)

• Fully liberalised from 1 Jan 2011 except for volumes intended for households priced by RBA (~10% of volume)

* Capacity supply agreement

•CSA is the intended mechanism for earning a (reasonable) return on invested capital in new capacity •Capacity prices are a big part of a power generator’s income

– a typical CHP plant ~35%, CCGT ~55%, of revenues •In the day ahead (spot) market, the price mechanism is a day ahead hourly auction. Supply – demand balance and variable cost (fuel) are the key drivers for the spot price •Financial market for electricity started in June, 2010

39

Capacity prices for new capacity considerably higher than prices for old capacity prices

• Long term rules and price parameters approved • Both “old” and “new” capacity can participate in capacity auctions • Old capacity (pre 2007) and new capacity priced differently

– Old capacity is priced by capacity auctions; price cap possibility – New capacity under capacity supply agreements to receive guaranteed payments

• The payments for new capacity are based on approved pricing formulas – Vary according to plant size, fuel, geographic location, capital costs – Allow the recovery of capital costs and include return on invested capital; the targeted ROCE level 12-

14% (with current government benchmark bond yields) – After three years (2014), the regulator will review the earnings from the electricity-only market and can

revise the payments, same goes after 6 years.

“Old” capacity prices will depend on auction outcomes, but will likely remain relatively low; potentially price caps could limit the price

85% increase in power generation capacity in Russia by 2015 through the investment programme

40

Income statement MEUR III/2014 III/2013 I-III/2014 I-III/2013 2013 LTM Sales 976 1,060 3,466 3,918 5,309 4,857

Other income and expenses -793 -893 -2,551 -2,939 -3,906 -3,518

Comparable operating profit 183 167 915 979 1,403 1,339

Capital gains and other items affecting comparability -34 -70 1,863 22 106 1,947

Operating profit 149 96 2,778 1,002 1,508 3,284

Share of profit of associates and jv’s 1 3 111 115 178 174

Financial expenses, net -56 -72 -169 -212 -289 -246

Profit before taxes 95 27 2,721 904 1,398 3,215

Income tax expense -11 3 -134 -157 -186 -163

Net profit for the period 84 30 2,587 748 1,212 3,051

Non-controlling interests -1 -1 4 2 8 10

Net profit for the owners of the parent 85 31 2,583 746 1,204 3,041

EPS, basic (EUR) 0.10 0.04 2.91 0.84 1.36 3.42

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Comparable and reported operating profit

III/2014 III/2013 III/2014 III/2013 I-III/2014 I-III/2013 I-III/2014 I-III/2013

Power and Technology 167 139 124 44 601 652 537 644 Heat, Electricity Sales and Solutions -4 -3 4 8 55 68 116 83

Russia 1 -15 1 -15 102 46 102 46

Distribution 36 59 36 76 200 256 2,066 274

Other -16 -14 -16 -17 -43 -42 -44 -45

Total 183 167 149 96 915 979 2,778 1,002

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Comparable operating profit

Reported operating profit MEUR

• Non-recurring items (mainly to the sale of the Finnish electricity distribution business), IFRS accounting treatment (IAS 39) of derivatives and nuclear fund adjustments had an impact on the reported operating profit EUR -34 (-70) million in the third quarter and 1,863 (22) million in January-September.

Comparable operating profit

Reported operating profit

Note: The divested distribution operations are included in the segment information until the closing of the transactions.

Cash flow statement MEUR III/2014 III/2013 I-III/2014 I-III/2013 2013 LTM

Operating profit before depreciations 276 265 3,185 1,461 2,129 3,853

Non-cash flow items and divesting activities 18 59 -1,903 -104 -262 -2,061

Financial items and fx gains/losses 47 68 52 -242 -188 106

Taxes -68 -68 -164 -149 -210 -225

Funds from operations (FFO) 273 324 1,170 966 1,469 1,673

Change in working capital 15 77 140 185 79 34

Total net cash from operating activities 288 401 1,310 1,150 1,548 1,708

Paid capital expenditures -194 -259 -524 -670 -1,004 -858

Divestments of shares* 1 92 2,818 129 144 2,833

Other investment activities 164 -82 383 44 -84 255

Cash flow before financing activities 259 152 3,987 653 604 3,938

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* Including Proceeds from the interest-bearing receivables relating to divestments

Key ratios

MEUR LTM 2013

Comparable EBITDA 1,864 1,975 Interest-bearing net debt 4,790 7,793 Comparable net debt/EBITDA 2.6 3.9

excluding Värme financing 2.2 3.4

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Return on capital employed, ROCE (%) 18.9 9.0 Return on shareholders’ equity, ROE (%) 29.0 12.0

Good liquidity – committed credit lines total EUR 2.2 billion

Debt Maturity Profile

45

0

250

500

750

1000

1250

1500

2014 2015 2016 2017 2018 2019 2020 2021 2022 2023 2024+

Bonds Financial institutions Other long-term debt CPs Other short-term debt

MEUR

2014 32

2015 1,035

2016 863

2017 548

2018 629

2019 821

2020 76

2021 547

2022 1,057

2023 112

2024+

TOTAL

1,249

6,969

per 30 Sep, 2014 per 31 Dec, 2013 Average Interest Rate (incl. swaps and forwards) 3.9% 3.6% Portion of floating / fixed debt 47 / 53% 51 / 49%

Outlook

Nordic markets • Fortum continues to expect that the average annual electricity demand

growth will be 0.5% in the coming years • Electricity is expected to continue to gain share of total energy consumption

Russia • The target for the Russia Segment in Russian roubles, RUB 18.2 billion, to be

reached during 2015 is intact, but the euro result level will be volatile

Key drivers and risks • Wholesale price of electricity and volumes

• demand and supply • fuels • hydrological situation • power plant availability • CO2 emissions allowance prices

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Outlook

Annual capex estimate, excluding potential acquisitions • 2014 EUR 0.9 to 1.1 billion

Hedging

• The remaining 2014 approx. 70% hedge ratio at approx. EUR 43/MWh • 2015 approx. 40% hedge ratio at approx. EUR 41/MWh • 2016 approx. 10% hedge ratio at approx. EUR 39/MWh

The efficiency programme is close to completion and is estimated to be successfully finalised by the end of 2014 Taxation

• Effective tax rate for 2014 for the Group 19-21% • In Finland, the power plant tax (“windfall tax”) has been revoked

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Hedging improves stability and predictability

48

2009 onwards thermal and import from Russia excluded

• The efficiency programme is close to completion and is estimated to be successfully finalised during 2014

• Total annual cost savings visible in all divisions • Improved working capital efficiency • Divestments of non-core assets totalling over EUR 800 million

Fortum's efficiency programme 2013-2014

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SPEED - Cash flow improved by EUR 1 billion – FLEXIBILITY

CAPEX EUR 250-350 million

DIVESTMENTS EUR 500 million

WORKING CAPITAL Reduction

FIXED COSTS Reduce EUR 150 million compared to 2012

WHY WHAT WHEN 2013-2014

Facts of Distribution MEUR Fortum’s

Swedish distribution operations in 2013

Operating profit 263

Comparable operating profit 246

Comparable EBITDA 384

Capital expenditure 121

Number of employees 515

Volume of distr. Electricity, TWh 27.8

Number of el. Distr. Custom. (‘000) 903

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January 2013: Strategic assessment

commenced

December 2013: Assessment has been

completed, divestment the best alternative

– Evaluation of divestment opportunities country by

country

Closed by the end of Q1/2014:

Divestment of Distribution Finland

Ongoing: Evaluation of divestment opportunities by country

Closed by the end of Q2/2014:

Divestment of Distribution Norway

For more information, please visit www.fortum.com/investors