Fortum has appointed its current chief financial officer Markus Rauramo as its chief executive and president starting as of 1 July 2020.

He has pledged to turn the Finnish utility – including its massive fossil generation fleet in Russia and coal-heavy German subsidiary Uniper - into a European energy transition champion.

Rauramo will replace exiting CEO Pekka Lundmark, who was appointed CEO at Nokia, while Timo Karttinen will be acting CFO for an interim period.

“The energy transition has to be based on the three cornerstones of sustainability, affordability and security of supply. Our position as the third largest producer of CO2-free electricity in Europe provides a solid ground to build on,” Rauramo said.

“We will continue to reduce our coal-based production and pursue decarbonisation through growth in clean energy. At the same time, we will continue to provide security of supply through gas, which we will make clean over time.”

Fortum in recent years has stepped up its investments in renewable energies, in particular wind power in the Nordic region and Russia. But the company is way behind its Nordic peers Vattenfall and Orsted in its decarbonisation efforts given the still massive fossil generation fleet in Russia and Germany.

Uniper, which was spun off German utility E.ON and then sold to Fortum in 2018, has recently signed a cooperation deal with Siemens Gas and Power for the development of projects on the decarbonisation of power generation and sector coupling, with one focus on the production and use of green hydrogen (produced via electrolysis from renewable sources).

Uniper had announced a target to close or convert its coal-fired power plants in Europe by 2025 at the latest, and become carbon neutral in Europe by 2035. The company currently still emits 22m tons of CO2 in Europe.

The first pledge will be difficult to hold as Uniper only recently took its newly built 1.1GW Datteln 4 coal power plant in Germany into operation despite years of heavy protests by climate activists.

“We have excellent people and good assets at both Fortum and Uniper, to continue and to accelerate the ongoing transformation,” Rauramo said.

“Going forward we will have a more focused business portfolio and we will invest very selectively in strategic growth. At the same time we will ensure that the group’s financial strength is secured.”

Rauramo has been with Fortum for eight years, driven forward the Uniper acquisition, and in 2013 had already been acting CEO for a while. Prior to Fortum he worked at forest industry major Stora Enso.

Transition

New Fortum CEO to reduce coal-based output and make gas ‘clean over time‘