Finance expense was reduced by €1 million in respect of capitalised construction interest relating to the new build at the Duiven site (2014: €2 million). The capitalised interest was based on an interest rate of 4.0% (2014: 4.0%). In 2014, there was an additional reduction of €1 million in finance expense from the capitalisation of interest on the construction of a heat transmission pipeline by Indigo (6.0% interest rate).
Alliander uses FX swaps to hedge the currency risk. The currency translation differences result from the effect of the movements in the US dollar and sterling exchange rates against the euro on the available-for-sale financial assets (note ) and the finance lease obligations (note ).
The other finance lease expense relates largely to the finance lease obligations (note ) but also includes costs for letters of credit and arranging credit lines.