Good morning, everyone. A warm welcome to Fortum's webcast and news conference for the investor community and media on our half-year 2026 results. My name is Ingella Ulves, and I'm heading Investor Relations at Fortum. As always, this event is being recorded, so a replay will be available for you later today on our website. With me here in the studio are both our CEO Markus Raurama and our CFO Tiina Tuomela. Markus and Tiina will present the group's financial and operational performance for the Q2 and half year. Now let's go to our presentation, after which we can then take your questions in the Q&A session. I now hand over Markus to you to start.
Thank you very much, Ingella. A warm welcome to this call also from my side. I will start by going through the highlights of our Q2 and our financial performance and then talk about the market development. After that, Tina will provide more details on the financials and how the operational performance turned into our results. Let me now start with the highlights. As you all know, Q2 and Q3 are relatively small quarters result-wise, and we typically generate most of the results during Q1 and Q4. Before we dive deeper into the results, let's look at the highlights of Q2. Our achieved power price in the second quarter amounted to €44.9 per megawatt hour compared to €48.1 per megawatt hour last year. The realized market price, which is the blended price for Fortum's price areas, was 53.1 euros per megawatt hour compared with 26.4 one year ago. One reason for the lower achieved power price was lower physical value creation, mainly due to lower income from auxiliary services. due to lower than normal generation volumes the real life head ratio was high there were more planned nuclear outage days compared to q2 last year and low spring floods further limited our ability to benefit from the higher spot price it is also good to note that in the first quarter we allocated more volumes to hydro generation which limited our hydro volumes now in q2 we keep our full year guidance for the optimization premium intact it is still expected to be between 8 to 10 euros per megawatt hour our outright generation volume was 9.1 terawatt hours which is 0.6 terawatt hours more than in the second quarter last year nuclear generation was almost at last year's level despite uncertainty in the operating environment we continue to see robust underlying customer demand from various industrial sectors, which we believe reflects the long-term power demand growth. At the end of June, Fortum took a significant strategic step for growth in our consumer solutions business, as we announced a conditional voluntary cash tender offer to acquire all issued and outstanding shares in the Norwegian company Elmera as I will come back to more details of this transaction on my next slide also at the end of June we announced our decision to end coal-fired power generation in Finland by closing and dismantling our Meripori coal power plant disclosure is part of our coal exit to end all coal based energy production by the end of 2027 and reach net zero by 2040 the plant will be permanently closed as of first of march 2027 fortum and the city of pori are pursuing strong new growth in the meripori takuluoto area together with other industrial operators and the area will be developed into a nationally significant clean transition industrial zone. We continue to have a strong balance sheet and good liquidity, so our overall financial position continues to be very robust. The cash dividend of 74 euro cents per share was paid in the second quarter. Then a few words about the Elmera public tender offer. We are very excited about this transaction, as the combination of Elmera and our consumer solutions business will create a stronger Nordic business with greater capabilities to serve customers and create long-term value. We are also very pleased that Elmera's board of directors and the whole management are supporting the deal and recommending the transaction to all of its shareholders. Both the management and the board are also willing to tender all their shares in the transaction. The cash consideration is 47 Norwegian krona to be offered for each Elmera share. This means a total value of the offer of 5.1 billion Norwegian krona or approximately 475 million euros. The completion of the offer is subject to certain customary closing conditions and regulatory approvals, as well as valid shareholders' acceptance of more than 90% of the company's shares. Let me go through the strategic rationale for the offer and how it supports our strategy and long-term value creation for our stakeholders. The rationale is built around four key elements. The ongoing structural change in the Nordic retail electricity market. Consumer Solutions and Elmera are two complementary businesses. This transaction creates value for our shareholders and other stakeholders, and it makes us fit for the future. Let me now briefly elaborate on each of these four points. First, there is an ongoing structural change in the Nordic retail electricity market. While the Nordic retail electricity market remains fragmented, customer expectations and digital requirements continue to increase in this sector, which is characterized by structurally low margins. As a result, scale, operational efficiency, technological capabilities, and investment capacity are important to deliver competitive pricing and reliable service to our customers. So, Consolidation is creating stronger and more capable businesses that can deliver greater value to Nordic customers while remaining competitive in a demanding market environment. Greater scale and resources strengthen the ability to invest in digital solutions, regulatory compliance and operational excellence. Secondly, we have two complementary businesses. consumer solutions is well positioned to capitalize on these market trends with deep energy market expertise and a strong position in the nordic retail market consumer solutions has established a scalable platform for future growth expanding the consumer solution business is a strategic priority for us supported by both organic initiatives and selective acquisitions Elmera is an established retail electricity provider with a large and diversified customer base across the Nordics. The company has a recognized position in Norway combined with challenger positions in Sweden and Finland. It has developed a robust retail platform which is complementary to Fortum's existing business. Elmera has slightly below 1 million customers, mainly in Norway, but also in Finland and Sweden. This can be compared to Consumer Solutions' customer base of approximately 2.3 million. In 2025, Elmera sold 16 terawatt hours of power to its customers, generating an EVDA of approximately 66 million euros. The combination of the two brings together complementary businesses with a shared focus to deliver value to customers By combining customer volumes, operational infrastructure and expertise across the value chain the combined business is expected to achieve meaningful cost efficiencies and operational synergies to the benefit of Nordic customers These efficiencies will strengthen the competitiveness of the combined business and support our ability to deliver competitive pricing and reliable service over time. The transaction will also enhance the combined businesses' capacity to invest in products, digital solutions and capabilities that support customers across the Nordics. The third rationale is value for shareholders and other stakeholders. The transaction creates a compelling value proposition for shareholders and other stakeholders of both companies. The combination also benefits employees by creating a larger and more resilient organization with greater resources, broader capabilities and increased opportunities for long-term development. And finally, being fit for the future. Our strategy is focused on supporting electrification across the Nordics. The planned transaction is a natural extension of this strategy, strengthening our customer platform and expanding our presence across the region. Looking ahead, the combined business will be better positioned to offer customers competitive pricing and to respond to evolving customer needs and changing market conditions. increased scale and efficiency are expected to strengthen our ability to invest in systems technology competence and operational excellence which will support competitive pricing and reliable service for our customers long term together we are no Mera will create a stronger Nordic platform with the scale capabilities and financial strength required to remain competitive we believe this offer provides Elmera shareholders with an attractive opportunity to realize value with certainty today and for those who wish to remain exposed to the Nordic power market Fortum continues to offer that opportunity as a listed company with a clear strategic focus on the region then I will move over to our main figures and financial performance let's look at our comparable headline KPIs for the group's second quarter and first half year of 2026 in the second quarter comparable operating profit and eps developed negatively in q2 our comparable operating profit totaled 106 million euros a decrease of 9 million euros comparable earnings per share decreased from nine to eight cents per share on the other hand operative cash flow increased clearly to 324 million euros due to decrease in working capital the decreased working capital reflects decreased sales prices for the past first half year all kpis developed positively all of this resulted in a leverage of 1.4 times as measured by the net-debt-to-comparable EBDA ratio. Next, a few words about the market environment. Let's start by looking at the spot price and hydro reservoir situation for the Nordic market. It is good to note that this is not Fortum's reservoirs, but the whole Nordic market. At the beginning of Q2, the reservoir balance had a small surplus of around 2 terawatt hours, which declined during the quarter. During May, it moved into a rather large deficit of 9 terawatt hours. This represented an intra-quarter swing of nearly 10 terawatt hours, after which it partly recovered during June, and Q2 ended with a moderate deficit of around 5 terawatt hours. In Q2, Nordic day-ahead prices increased significantly year on year, driven by lower reservoir levels, stronger continental crises, and low spring floods. Nordic power demand in Q2 developed sideways year on year, while wind availability was below seasonal average both in the Nordics and especially in central Western Europe. Nordic consumption was at 89 terawatt hours. It is good to note that power demand in the Nordics is somewhat above 400 terawatt hours for the last 12 months. This concludes my part, and I would now like to hand over to Tina to talk more about our business performance.
Thank you, Markus. Good morning, everyone, also on my behalf. I will now go through our finances in more detail. Let's start with the key figures. I will start with some of the comparable KPIs. The comparable operating profit for the second quarter amounted to 106 million euros, which is a slight decrease from previous year. In the quarter also comparable net profit and comparable EPS decreased. Our comparable net profit for the quarter declined to 74 million euros. Consequently, our comparable EPS for the second quarter declined to 8 euro cents compared to 9 euro cents last year. Our cash flow during the quarter was 121 million higher than in the comparable quarter last year and totaled 324 million euros. Slightly lower EPTA was offset by the positive change in working capital. The main reason for the lower working capital comes from the lower receivables in consumer solutions due to the lower power prices. Then over to the segment result for comparable operating profit. Let's have a look at the second quarter. The group's comparable operating profit declined by €9 million to €106 million, mainly due to the lower achieved power price and higher fixed costs, partly offset by higher hydro generation volumes. Achieved power price was affected by lower income from ancillary services and high hedge ratio. The profits of consumer solutions also declined slightly while the other operation segment's result improved. In the generation segment, comparable operating profit declined by 11 million to 110 million euros, mainly to the lower achieved power price, lower physical value creation and higher fixed costs. The lower physical value creation was mainly a result of lower income from ancillary services. I also want to highlight our generation volumes as a result contributor. As you remember, we allocated as much as possible of our hydrogeneration to the spot market in the first quarter when prices were high. However, as hydrogeneration was exceptionally low in Q2 last year, Q2 volumes this year were still below the historical average. Nuclear volumes were slightly lower, mainly due to the plant outages days compared to Q2 2025. Consumer solution comparable operating profit declined by 5 million to 42 million euros, mainly due to the higher fixed cost. The reporting period includes a marginally positive effect of the acquisition of Orange Energy completed in June 2025. Orange integration and carve-outs have now been completed. it. In the other operation segment, comparable operating profit improved by 8 million, mainly due to the lower fixed cost. The circular solutions result was slightly higher compared to Q2 last year. Comparable operating profit increased by 50 million to 627 million euros. The generation segment result increased mainly as a result of higher spot prices and hydro volumes partly offset by the high hedge ratio. The result of the consumer solution segment decreased slightly while the result of the other operation segment was almost flat. In the generation segment the result increased by 57 million to 613 million euros impacted mainly by higher spot prices and hydro volumes partly offset by the high hedge ratio. Our hydro generation for the first half 2026 was slightly below the long-term historical average with part of volumes allocated already during the first quarter. Comparable operating profit in consumer solution decreased by 7 million to 66 million euro mainly to the higher fixed costs in the other operation segment comparable operating loss was almost unchanged at 53 million the result of circular solution businesses was slightly higher compared to the first half of 2025. Then over to loan maturities, leverage and liquidity. Our financial position continues to be strong, primarily supporting our objective to maintain a credit rating of at least BBB. It naturally also provides a good financial foundation in this very uncertain and turbulent and market environment, but it also matters for growth and shareholder returns. In these uncertain times with various geopolitical conflicts, this is a very good position to be in. At the beginning of the second quarter, according to the new definition, our net debt was 1.5 billion euros. In the second quarter, the operating cash flow was €324 million and investment amounted to €109 million. The change in interest-bearing receivables and net margin amounted to €24 million, while effects and other effects were €14 million. euros. The change in collateral debt was 119 million euros. Consequently, at the end of the quarter, our net debt was 1.8 billion euros, and the leverage ratio for net debt to comparable EBITDA was at 1.4 times. The dividend of 664 million euros was paid in April, so during the second quarter. Looking at our debt portfolio and the loan maturity profile I want to highlight a few things. At the end of the quarter our cross debt excluding leases total 3.8 billion euros. Our maturity profile is very balanced and there are no last maturities in any single year. The February we repaid a maturing 750 million euro bond. In 2028 a 500 million euro bond will mature. Bonds are and continue to be our primary source of funding. We continue to have ample liquidity reserves 6.5 billion euros with 2.1 billion of liquid funds and 4.4 billion of undrawn committed credit facilities and overdrafts at the end of June 2026. The cost for our 3.8 billion euro loan portfolio is 3.1% while the interest income that we get for our 2.1 billion euro liquid funds is 2.1%. The overall objective is to have sufficient liquidity while optimizing the balance between debt and cash to minimize funding cost. Then over to the final section, the outlook. The outlook section includes guidance regarding our outright portfolio, capital expenditure and taxation. Let's start with the hedges. For the rest of the year the hedge price is 40 euros and the hedge ratio is 80 percent. The hedge price for 2027 increased by 1 euro to 41 euros, while the hedge ratio increased by 5 percentage points to 65 percent. For the year 2026, optimization premium is estimated to be between 8 to 10 euros per MWh. Predictability becomes more uncertain the further out in time you go. Consequently, our longer-term view continues to be 6 to 8 euros per megawatt hour for the year 2027 and onwards. Considering announced altitudes, nuclear output for 2026 is estimated to be below the normal level of 26 terawatt hours. Based on current market information, we estimate that our nuclear volume will be between 23 and 23.5 terawatt hours in 2026. The guided range has been reduced by 0.5 terawatt hours. Our capital expenditure guidance is unchanged. Next, we have 550 million committed for the year 2026. This includes maintenance but excludes potential acquisitions. For the period 2026 to 2030, the committee's capex is 2 billion euros, of which 750 million is growth. Annual maintenance is expected to be 250 million euros. The guidance for our corporate tax rate also remains unchanged for 2026. We expect the comparable effective income tax rate to be in the range of 18 to 20%. This was all for my presentation and we are now happy to answer your questions. So with this, Ingela, over to you.
Thank you, Tina, and thank you, Marcus, for the presentation. So, we are now ready to take your questions, and we can begin the Q&A session. Moderator, please go ahead.
Operator
If you wish to ask a question, please dial pound key 5 on your telephone keypad to enter the queue. If you wish to withdraw your question, please dial pound key 6 on your telephone keypad. The next question comes from Harry Wybird from BNP Paribas. Please go ahead.
Hello, morning everyone and thanks for taking my question. So two please. So firstly I just wanted to focus on Nordic power prices and particularly this winter. So I think Nordpol's got up to about €85 a megawatt hour for Q4. So I wanted to ask how should we think about your ability to capture that? Obviously you've, as usual, you've given us your hedge for the rest of the year, so your 80% hedge, but maybe you could tell us a little bit about how hedged you are for Q4 and Q1 of 2027, because given the big moves in power, actually, unusually it's now actually quite relevant what percentage hedge you are for those specific quarters as opposed to the half year, if that makes sense. So basically I'm just trying to understand how much you can capture this big increase in Norpool prices over the winter. So that's question one. The second one is whether you've got any updated comments on Uniper assets. So have there been any discussions? Is your appetite unchanged from the last conference call? And then a couple of tidbits on top. So firstly, would you consider acquiring the assets if your right of first refusal lapsed? Because I think it lapses at the end of this year. So if the assets were still for sale in 2027, would you still look at them? And also, would you ever consider raising equity to fund a transaction like that? Because I guess particularly given the Elmera acquisition, if we look at sort of regular multiples for the Uniper assets, it probably would be bigger than you could digest given your balance sheet at the moment. So interested to know what kind of funding options you would look at.
Okay, thank you very much for the questions. So I'll start with the Uniper and comment shortly on the Nordic power market as well. and let's see in a comment in in more detail but which was us to uniform so we we all have seen the german government announcement inviting indications of interest for the for the whole company now without going into specifics of who has indicated and what we continue to be interested in universe nordic assets and that would go for other nuclear and hydro in nordics overall so if there is nuclear and hydropower available we would look at it so the interest continues to be there if that when when the ROFO ends then our interest continues so our interest in clean a dispatchable power is not limited to the to the ROFO which regards to to the financials and our appetite and capacity we continue to follow our stated financial targets so strong investment grade rating underpinned by the leverage level of 2.5 that we should not go across so we would approach transactions from from this framework and we have no plans for any kind of equity raise then for the Nordic power market so we communicate our our hedges for this year and next year so we do not communicate us as you know we do not communicate quarterly hedging levels the 80% already gives an indication that there is room to optimize this year and 65% for next year gives more space. What I would say overall is that the purpose of our hedging strategy is to provide visibility into cash flows in the short term and then eventually also stabilize our income and capture good prices in the long term with our customers. And I think this is really well highlighted.
If you look at the achieved power price for the first half year, it was exactly at the same level 55 euros first half this year, first half last year when the market prices were at very very different levels but with this Tina, anything you want to add? maybe only building on that of course the hedge ratio so not every quarter is the similar one and I think that one contributor of course is that how much volume it is during the quarter and typically Of course, we look at the high quarters, so the first quarter and the last quarter, so the volume produced in those quarters also impact to the hedge ratio.
Got it. Thanks Tina. And Marcus, so just a follow-up, so got it you're not planning any imminent equity raise and also got it that you've got a leveraged ceiling of two and a half times. But I guess if we just assume for the sake of now that the assets would be too expensive for you to be able to acquire them and stay within your two and a half times net debt to EBITDA ceiling, are there any other financing tools that you would consider using just to help us a little bit if we were to scenario analyze this, I don't know, hybrids or minority sales in assets and is there some other financing tool that you would consider if you were to acquire those assets and you weren't able to do it on balance sheet and stay within two and a half times net debt to EBITDA? so the guidance I would give is that that we look at potential acquisitions like now with Elmera also on district heating renewables as well as hydropower
and nuclear power within the financial limits we have so so this is the framework we can give and I wouldn't go into speculating on how to finance any potential transactions at this point in time okay fair enough all right thank The next question comes from Wanda Surwinowska from UBS.
Operator
Please go ahead.
Hi. Thanks a lot for your presentation. Two questions for me. The first one is a very short one on the Elmera acquisition markets. You mentioned meaningful synergies, but would you be able to somehow quantify it? Are we talking about double digits, million-euro pay, and so is it low, mid, or high? and any help would be appreciated. And the second question is on your higher fixed cost, which I was surprised by, because I remember you are running the cost-cutting program. You expect more benefit from the cost-cutting program by 2030, if I'm not mistaken. So can you talk a bit more about the reasons behind the fixed cost increase? How much was it in Q2, and what do you expect going forward? Thank you.
Thank you. so I'll start with Elmera and I'll let Tina comment on the on the fixed cost so indeed we have two very complementary businesses Fortum Consumer Solutions and Elmera and the couple of the drivers are that market is fragmented there are big-scale advantages in utilizing same platforms as we have done with the acquisition of Havslund with Orange, Telia and so on so we can integrate big amounts of customers with very low marginal cost now with regards to the transaction we will be filing our offer document with the Norwegian financial regulator and we will have the competition authority reviews as well and then we need shareholder approval so once we get through those then then we'll give more details on what the what the targets are but at the moment we can say that they are meaningful and we can look back at the previous transactions what we what we have achieved there and for fixed cost Tina yes so definitely fixed costs are still pretty much on our focus and we continue the continuous continuous improvement last year we finalized our efficiency program of this 100 million euros successfully, and we say that we target the overall cost level of 870 million per
And if we look at the cumulatively, what is our fixed cost level at the end of Q2, it was 428. So we could say that we are on the right run rate overall if we look at the fixed cost level. Of course, there are variations between the quarters, and as we see also that between some of our segments, they were lower, some higher, but overall, we are well on track.
If I may, a couple of follow-ups. So, Tina, would you be able to quantify the total increase in Q2, and what would you expect for the full year before the next cost cutting kicks off? And, Marcus, you mentioned synergies from the previous transactions. Do you mind reminding us how much you achieved on the previous transactions? Thank you.
Tina, do you want to take the Q2 increase?
So the cost increase overall, it was 11 million. So 11 million increase in Q2. Of course, I said that at quarters, they are not alike. We are not giving any other guidance rather than that roughly 870 million overall level. Of course, if there are scope changes, if there are new activities, some new efforts, so those would naturally impact the cost level, but also, of course, bring more EBIT and profitability for us.
And for the previous transactions, so in the large ones, synergies have been double-digit, And then we have smaller ones where we necessarily haven't announced all the synergies in every case. But meaningful synergies with regards to each transaction. Now we are not quantifying yet for the proposed Elmera transaction.
Operator
Next question comes from James Brand from Deutsche Bank. Please go ahead.
Hi, good morning. Thanks for the results and taking questions. I had two questions. Firstly, you said in Q2 that your optimization was impacted by low water levels and low volumes overall. Do you see that continuing in Q3, or is Q3 seeing more normal conditions? That's the first question. And then secondly, on the demand side, I was just wondering whether you could give an update, given that's obviously massively in focus for the market. So, you know, what did you actually see in the Nordics for demand growth in Q2 year on year? And then, you know, do you see the outlook changing at all in terms of kind of data centers and industrial demand growth from what you said at the last quarterly results? Thank you very much.
Thank you. So I can start with the demand and if you can comment Q2 versus Q3. so the demand outlook or demand right now is roughly on a rolling 12-month basis in the Nordics around 400 terawatt hours and in the last quarter it was 89 so we are at very similar levels no material changes either way so the bigger impacts will come once the currently under construction data centers will hit the market, and eventually when also new demand will pick up. With regards to our customer pipeline, we are using the same wording, so we continue to see robust interest in the Nordics. And I think this is highlighted, the reasons are highlighted now by EU's electrification action plan. So EU is highlighting that we need clean, affordable, reliable, homegrown energy versus imported, very expensive fossil energy. And the electrification action plan actions look very much like what we have in the Nordics already. And this is attracting globally customers to the Nordics. We continue to see interest in metals. We continue to see interest in data centers, as well as longer term in hydrogen. And at the moment, it's data centers which are the most active ones, and they will be more incremental. I'll just take an example of the Microsoft cluster in the Capital Region. It's been a long project. Now Microsoft is building modularly their three-site cluster. We have already commissioned our heat pumps and heat storage and electric boilers that are associated with that. So eventually we'll see, for example, that three times 200 megawatt demand hitting the market. And Tina?
Yes, then to the optimization premium. So what we said that our achieved power price in the second quarter was impacted with the lower optimization premium and then the high hedge ratio. And the optimization premium consists of the three main elements. One is coming from the hydro optimization, which was at the good level. volatility remained roughly on the same level as the previous previous quarters the second one relates to ancillary services and this is the part where we saw that the prices were were lower mainly impacting that that many batteries electric boilers customer demand are also entering this this market and therefore impacting the premium. And then the third one is the environmental value, which was pretty much the same as earlier. Then the second quarter, third quarter, so I think that what is important to highlight is that the full-year optimization premium, what we have remains the same, the guidance, so 8 to 10 euros per megawatt hour. So, of course, there are temporary fluctuations based on the volatility and also the players who are in the market.
Can I just ask, thank you so much for that, can I just ask on the ancillary services part of the optimization, I don't think I've heard you talk about that too much in the past. Could you quantify at all how much of the overall optimization premium normally comes from ancillary services? And I'm not necessarily looking for you to be too precise, but just kind of roughly, is it a kind of significant part of it?
So we haven't split in the number wise in that detail. However, what we have said that the maturity comes from the hydro optimization. The part which performed very well also in this second quarter.
Great. Thank you so much.
Operator
Next question comes from Louis Bouchard from Otto BHS. Please go ahead.
Yes, hi. Good morning and thank you for the presentation. Maybe coming back a little bit on Elmera acquisition, how should investors think about the next phase on Fortune Group's strategy after this operation? Does this transaction reduce the likelihood of other flysable M&A in the future? And do you think that as the acquisition changes your thinking regarding the capital allocation between M&A and organic investments and shareholder distributions going forward considering the size of the operation, how should we consider it in your strategic thinking as well? Maybe a second question regarding the Nordic forward curve and your hedge position. How would you characterize your earnings visibility for 2027 at this point in time relative to previous year and is the volatility likely to remain higher than investors have historically been seen in the past and do you think that it could eventually enable you to be a bit more positive on your optimization premium going forward? Thank you very much.
Okay, again, I would ask Tina to answer the second question on the Nordic outlook and how we think about our hedging. On the first one, so this transaction, the proposed transaction with Telmera, it is indeed in the early stages. So first we have to get this through the Norwegian FSA and the competition authorities and then get the shareholder approval. This is a large transaction, so this will be taking a lot of our management attention in consumer solutions if this goes through the combination of 2.3 million and nearly 1 million customers. Having said that, this is a thing, integrating, getting the synergies is something we have done many times over, so I'm very confident that we can then deliver what we are targeting to do in regards to shareholder value and value to our customers. So there will be, then, if this goes true, there's a transaction to digest first in consumer solutions. With regards to capital allocation, we continue to be interested in growing with our customers through PPAs, so we are ready to take counterparty risk, do also longer transactions, so we are very open to do business. we are very open also to investing for our customers in new capacity so we have developed the the renewable pipeline as well as flexibility so at the right prices we are happy to also then provide capacity for the for the customers if that is needed and then we have said with regards to to the capital allocation that our dividend policy is 60% to 90% of the net profit, or EPS, and we will use that range flexibly depending on our balance sheet capacity and with regards to if we have investment opportunities. So now when we have not had larger investments, we have been paying 90%, and then when we assess the situation around the end of the year and beginning of the year and when the board is making its proposal for the AGM it will take into account our balance sheet and liquidity and the whole capex outlook so i will not go pre-empting that but just stating that there is a range that we have said that we will use depending on the circumstances and then for the second question nordic curve nordic yes so so when we look at Nordic power prices, so they have been an uplift, mostly driven by the low hydro reservoirs.
So as we saw also in the second quarter, so hydro reservoirs at the beginning were marginally surplus, and then they went to a deficit of minus 5 terawatt hours, and they have continued, If we look at this stage also, now it's even minus 10 terawatt hours compared to the historical average. Of course, this can change, as we know, so very quickly if the rainy season comes from. The other thing is the volatility. So volatility seems to, in overall level, has remained on the higher level, And then the main reason is that more renewables is already in the system. And when it's windy, it is volatile, it's not windy. So even the current amount of renewables keeps the system moving quite a bit. Then maybe one point to also note that the prices, if we compare the Nordic and the southern part of the Nordic, have been very different. So in the Nordic, where we have the wind and where we have also the hydro, so the prices have been lower. We're asked in the southern Nordic, close to also continental Europe, the prices have been fairly high.
Operator
One question comes from Rob Pullen from Morgan Stanley. Please go ahead.
One question for me, given what's been covered so far, and that's regarding nuclear volumes as we think ahead to 2027 and discussion of hedge ratios. How competent are you in a return to, shall we say, normal nuclear volumes, given obviously some of the outages this year and in the past?
Yes, so we have had unavailability in Oskar's Hum. Now the plant is being ramped up and the problems have been cleared. So we are targeting then better availability. There are also now limitations in Alkyloto 3, so this is the area where we have most potential, actually, when it comes to availability. Our hydro availability has been on a good level, nuclear not so good. I have confidence that we can get Oskarsham 3 as well as Alkyloto 3 then to the right availability levels, but admittedly there have been problems.
Operator
The next question comes from Iris Temen from DNB Carnegie. Please go ahead.
Hi, thanks for your presentation. I have just one question. Regarding your optimization premium, so why do you expect a lower optimization premium for next year, even though price volatility is likely to increase and basically is it due to lower income from ancillary services? Thank you.
Tina, do you want to take that one?
Yes, happy to take that. Yes, I think what we have all also said that because it is very difficult to predict the overall volatility in different times, so therefore we have given the longer term optimization premium guidance, the P68, and we will further define closer we get that period. Of course, in site optimization premium, one interesting part is to look at how the ancillary service develops, and this is one part why we are a bit more cautious when giving the longer-term guidance.
Hi everyone. Iris' question actually was the last one, so thank you for all your questions here today, and thank you moderator. on behalf of Fortum and the whole team here we wish you all a very nice rest of the day and also let's enjoy the next summer days and then we'll be back in the autumn Thank you Have a good July Bye-bye Bye-bye
