Cloudberry Annual report 2022 Board of Directors report 28 the existing wind projects must be exempted from the ground rent tax for onshore wind, and ii) for new projects it is important the taxation is implemented with investment neutrality to ensure continuous development of renewable energy in Norway. Cloudberry delivered an official hearing on 15 March 2023, and will continue to work on improving the proposal until the final vote in Parliament hopefully before summer of 2023. The war in Ukraine On 24 of February 2022 Russia attacked Ukraine which started a war that is still ongoing at the time of publication in March 2023. The invasion is a terrible tragedy for all affected both within and outside the Ukraine boarders. Further, the invasion has resulted in severe implications on inter alia global trade, global markets, energy prices and commodity prices. During 2022, Europe, and the Nordics, saw record high power prices, primarily driven by soaring gas prices after European gas imports from Russia ended. The intermediate danger of a European gas shortage has since been reduced, and power prices have dropped significantly, but are still at historically high levels. As Cloudberry primarily sells its electricity in the spot market, the war’s effect on energy prices has, and will continue to have, a significant impact on Cloudberry’s revenues. Further, there may be implications to global trade, transportation costs and/or commodity prices, which may increase the cost of Cloudberry’s construction projects. It is still highly uncertain how the conflict will evolve and how it will continue to have an impact on the global economy going forward. Cloudberry continues to assess the risk related to volatility in energy prices and implications of the war in detail going forward. Outlook Cloudberry is continuing its profitable growth and has become a leading Nordic Independent Power Producer (IPP). Please refer to the recently announced acquisition of “Odin”, which provides diversification into a new attractive market and price area DK1. We are pleased that Odal Vind and Hån wind farms are in full production adding new renewable power to our portfolio. New wind power will also affect our production profile especially in winter where our hydro based portfolio is generally producing on a lower level. Further strengthening the production profile and power production is the FID on Sundby Wind Farm in SE 3 adding another 32MW to our portfolio once it is in production at the beginning of 2024. We have an increased focus on growing our development backlog with new hydro and wind projects. We are happy to see new projects in Sweden coming into the development portfolio. On the offshore side we continue our work on our latest early-stage project Simpevarp (800MW) in Sweden and also other near shore projects in the Swedish sector. On the international arena EU is focusing on speeding up the energy transition through Fitfor55 and RePowerEU at the same time as they are looking at a redesign of the energy market. We are following the work closely and hope the outcome will be positive for the development of new renewable power throughout the EU leading to reduced and more stable energy prices for the consumers and industry. The Nordic power market continues to look strong with high spot prices and high forward prices compared to historical levels for all our relevant price areas. With the ongoing energy transition and the increased focus on security of supply the power prices are expected to remain strong. Corporate Governance The Board of Directors has a strong commitment to maintain a high standard of corporate governance. This ensures trust, and effectively and continuously improve the communication between management, the Board of Directors, shareholders, and other stakeholders. Cloudberry complies with the Norwegian Code of Practice (NUES). The Annual Report includes a statement on Cloudberry`s corporate governance principles and practices, including corporate audit, internal control of financial reporting and the work of the Board of Directors.
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