Europe tries to shore up power firms with billions more

Finland and Switzerland provided billions in financial support to power companies on Tuesday, as Europe scrambles to secure energy supplies in a deepening crisis sparked by Russia's move to shut a major gas pipeline.

Finnish utility Fortum (FORTUM.HE) said it had signed a bridge financing arrangement with government investment company Solidium worth 2.35 billion euros ($2.34 billion) to cover its collateral needs.

A Finnish government official told Reuters the support was in addition to the 10 billion euros of liquidity guarantees Helsinki announced for power companies on Sunday.

Swiss utility Axpo (AXPOH.UL) said it had received a credit line of up to 4 billion Swiss francs ($4.1 billion) from the government to help secure its liquidity needs.
The Swiss government has lined up a 10 billion franc safety net for power firms, but decided to allocate the funds to Axpo even though the legislation is still before parliament.

European governments are pushing through multi billion-euro packages to prevent utilities from collapsing and protect households amid soaring energy costs.
Benchmark gas prices in Europe have surged about 340% in a year, and jumped as much as 35% on Monday after Russia's state-controlled Gazprom (GAZP.MM) said it would indefinitely extend a shutdown to the major Nord Stream 1 gas pipeline.

Europe has accused Russia of weaponising energy supplies in retaliation for Western sanctions imposed on Moscow over its invasion of Ukraine. Russia blames those sanctions for causing the gas supply problems, which it puts down to pipeline faults.
"The ongoing energy crisis in Europe is caused by Russia's decision to use energy as a weapon, and it is now also severely affecting Fortum and other Nordic power producers," Fortum Chief Executive Markus Rauramo said in a statement.

(Reuters)