26.01.2022 | How Axpo Nordic drives its workforce and business in the Baltics forward
Axpo Nordic is one of our largest and most successful subsidiaries, with offices in Oslo, Malmö, and Helsinki. But it is much more than a Nordic company and enjoys a very international atmosphere with a diverse team of different nationalities, including Senior Structured Energy Trader Ruudi Lootus. Born and raised in Estonia, Ruudi joined Axpo three years ago. In this interview, he talks about the experience of leaving his country to make a completely new start, and what it’s like to work in an exciting business environment, busy growing Axpo’s business in the Baltic region.
Ruudi Lootus: I started working in the energy business about eight years ago as a commodity sales trader in a Swedish bank in Tallinn. Commodities looked exciting to me. Before joining the bank, I had briefly worked as an equity broker covering the US and EU markets. Equity markets are very company-specific and do not have the fundamental demand-supply structure that is inherent in commodities. I found the political aspect and the flow of energy from producers to consumers fascinating. That is why I was drawn to commodity trading very early on, and I have enjoyed it ever since.
Not really, but I always wanted to prove to myself that I could build up a completely new business area that works. In that sense, joining Axpo was exactly the right decision.
Axpo did not have any gas activities in the Baltic-Finnish gas market prior to my joining. The challenge they offered me was interesting. Meanwhile, we have managed to prove ourselves to clients as a reliable supplier of physical gas and trading counterparty for financial gas in the region. On top of that, when it comes to power trading, we have greatly strengthened our Baltic business and expanded into renewable power purchase agreements (PPAs) through several wind farms in Lithuania. And there is much more to come. Right now, my goal is to grow the power and gas business in the Baltic area even more, build new client relationships and help renewable developers with our long-standing expertise in marketing wind farms.
Yes, absolutely. Axpo is a progressive company which understands that the best way forward is to tap into employees’ strengths and encourage their growth. Also, we are a large international company with some of the best professionals in their respective fields. This is a major strength and allows us to provide additional value to our clients in a wide range of areas.
It is fantastic to see that the support for employees is always there and we are allowed and encouraged to expand and improve the business as we feel best. This is really outstanding and typical of the way Axpo pursues its business and empowers its workforce.
(laughing) Well, Axpo actually got in contact with me. At that time I was working at the trading desk of a large utility in Estonia, and I traded power with Axpo, so I was familiar with the company and they knew me too. When the Baltic gas market was opening up to Finland, Axpo saw a business opportunity to expand its already existing power trading business in the area to different commodities. That’s where this exciting journey started.
Yes, together with the Axpo Nordic management team we made the decision that the best option for me was to move to Norway. Oslo, and Norway in general, is the hub for Nordic power trading and Axpo is one of the most respected companies in this area. I saw that joining Axpo in the Oslo office would give me an opportunity to build a new business, challenge myself, and learn from the best at the same time. In addition to that, Oslo is a great city to live in, just a short flight away from the Baltics and Finland, so I am still close to the clients.
It has its challenges, especially in pre-Covid times where I could have met with clients and other market participants more often if I had been based in the Baltic countries. But there are more benefits to being based in Oslo, because the trading desk is based here and I can be close to the information. This enables me to act fast and serve the clients the best way possible. Although, when the pandemic is finally over, I intend for sure to see my clients in the Baltics more often than I have in the past two years.
The Baltic energy market is now more interesting than ever. The production mix has been steadily changing from non-renewable sources like shale oil to renewables such as wind and solar. Renewable power production has more than doubled over the last ten years and is expected to continue its fast growth.
On the gas side, Baltics has gone through big changes as well, especially when it comes to market integration. Latvia and Estonia became one balancing zone and last year Finland joined the area with the commissioning of the Balticconnector pipeline. Hopefully, in the not too distant future, Lithuania will be added to the common balancing zone, too.
On top of that, in 2022 we will see the commissioning of the Lithuanian-Polish gas pipeline, which opens up the Baltics and Finland to the European gas market – an exciting step for all parties involved in the Baltic gas business.
All of this encourages more market participants to join, and it increases the liquidity in the area, which eventually benefits everybody. We can see this already today.
For me, it’s clearly the lack of power when the wind is not blowing. Baltics do not have nuclear power production to cover the low supply periods, so production from less environmentally friendly fossil fuels is still necessary. We need a mix of different renewable production sources and a good connection to neighbouring countries when the production is low. Investments in battery solutions would also help mitigate the problem. Currently, the renewable production mix is heavily dependent on wind, so a combination of solar and wind would be a better solution.
We can support renewable power developers mitigate the price risk involved in building a wind farm or solar park. Our experience and expertise from different countries across Europe and the USA can help local developers in the Baltics find a customised solution for their project. We are also proactively seeking innovative projects and business opportunities to support the energy transition, as in the case of the battery commercialisation project in Yllikkälä/Finland. That’s what customers in the Baltics can benefit from, too.
(laughing) It wasn’t as difficult as I actually thought. Everyone in Norway speaks English, so that helped me from the very beginning. Also, I was very well taken care of by Axpo – they supported me with local registrations, the apartment, and so on. On top of that, we have Norwegian language lessons regularly to get us better integrated into society. In the Axpo Nordic office in Oslo, we have people from Sweden, Finland, France, Estonia and China, so it’s quite an international crowd and that’s really fun.
There are definitely some differences. Work-life-balance is very important here in Norway and personal life is not pushed to the background. Also, the company structure and environment is less hierarchical than I was used to, which I enjoy. All the employees are real professionals in their specific field and we discuss and respect each other’s opinions irrespective of someone’s position in the company.
I enjoy it very much. It is a rather small city compared to other capitals in Europe, but it has a lot of benefits. For example, just a couple of train stops away you can find amazing hiking trails and skiing tracks. People are relaxed here and enjoy doing outdoor activities – and so do I.
I have learned to appreciate cross-country skiing again. I used to ski in Estonia when I was younger, but it was not that popular in the area where I lived. Now, after coming here and having world-class tracks right next to the city, I have learned to enjoy it again. Usually every weekend and sometimes even during the week after the markets have closed.
I believe in maintaining a good work-life balance to remain efficient. For me, sport is a way to recharge. During the summer I go golfing with my wife and friends as much as I can. And when the snow comes, I take out my skis and often meet colleagues at the tracks.
Ruudi Lootus (32) was born and grew up in Estonia. He studied Business Administration, Finance and Economic Analysis at Tallinn University of Technology, and is a CFA level III candidate. He started his professional career in banking in 2012 with Swedbank, and moved on to Eesti Energia in 2016 as an energy trader. In January 2019, he left Estonia to work for Axpo Nordic in Oslo as a Senior Energy Trader in Structured Trading.
Axpo Nordic is part of the Axpo Group, the largest energy company in Switzerland. The wholly owned subsidiary was founded in 2003 for the markets in Northern Europe and the Baltic region. The focus of its business activities in the Nordics is on long-term power supply and purchase agreements. In addition to its PPA business, Axpo Nordic develops bespoke products and associated services for its customers, such as retailers, industry, and producers. The business activities in the Nordics are part of Axpo’s strategy to grow its international presence and business specialising in tailor-made energy solutions.