The Court of Appeal in Warsaw dismissed the appeal of the ERO President regarding the settlement of value of annual adjustment of the stranded costs (so-called LTC compensations) for 2010 for PGE GiEK S.A.
No. of the report: 34/2014
Report date: 07.07.2014
Report legal ground: Art. 56 section 1 p. 1 of Act on Public Offering – confidential information
Contents of the report
The Management Board of PGE Polska Grupa Energetyczna S.A. discloses that on July 7, 2014 the Court of Appeal in Warsaw dismissed the appeal of the President of the Energy Regulatory Office (the “ERO President”) against a judgement of the Regional Court in Warsaw – the Court of Competition and Consumer Protection (the “CCCP”) of June 10, 2013 regarding the settlement of value of annual adjustment of the stranded costs for 2010 for PGE GiEK S.A. (including for period from January 1, 2010 till August 31, 2010 for PGE GiEK S.A. as a legal successor of PGE Elektrownia Turów S.A., PGE Zespół Elektrowni Dolna Odra S.A., PGE Elektrociepłownia Rzeszów S.A. and PGE Elektrociepłownia Lublin-Wrotków Sp. z o.o.) due as a result of the termination of long-term contracts of sale of capacity and electricity (so-called “LTC compensations”). The judgement is final and binding. However the ERO President is entitled to file a cassation appeal with the Supreme Court.
The claim value in the PGE GiEK S.A. case, calculated as a difference between the amount of annual adjustment calculated by the company from PGE Capital Group and the amount settled by the ERO President in decision, amounted to approximately PLN 393.5 million.
The Management Board of PGE expects that the judgement will have a negative impact of approximately PLN 114 mln in H1 2014 on financial results of the PGE Group in Conventional Generation business line.
Legal ground: Art. 56 section 1 point 1 of the Act on public offering, conditions governing the introduction of financial instruments to organised trading, and public companies (Dziennik Ustaw 2009 no 185, item 1439, as amended).