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 2009 for PGE GiEK S.A. Branch ZEDO
5/2013
17.01.2013 15:01
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 January 17, 2013 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 4, 2012 regarding the settlement of value of annual adjustment of the stranded costs for 2009 for PGE GiEK S.A. Branch ZEDO 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 total claim value of disputes concerning LTC compensations for 2009 due to generators from the PGE Capital Group, calculated as a difference between the amount of annual adjustment calculated by the companies and the amount settled by the ERO President in decisions, amounts to PLN 672.9 million. The claim value in the PGE GiEK S.A. Branch ZEDO case was PLN 93 million.
Description of the case:
On July 30, 2010, the ERO President issued decisions in relation to following generators from the PGE Capital Group: PGE Elektrownia Opole S.A., PGE Elektrownia Turów S.A., PGE Zespół Elektrowni Dolna Odra S.A., PGE Elektrociepłownia Rzeszów S.A., PGE Elektrociepłownia Lublin - Wrotków Sp. z o.o., PGE Elektrociepłownia Gorzów S.A., concerning the annual adjustment of stranded costs and annual adjustment of the cost generated in gas-fired units under the Act of June 29, 2007 on the principles of compensating for generators' costs arising in connection with the early termination of long-term contracts for the sale of capacity and electricity (Dz. U. of 2007 No. 130, Item 905, as amended). Pursuant to the decisions mentioned, the above companies were obliged to return amounts indicated in the decisions to Zarządca Rozliczeń S.A. or were given lower adjustments than expected. The companies from the PGE Capital Group appealed against the decisions of the ERO President to the CCCP.
Until the date of this report CCCP issued 2 verdicts regarding annual adjustments of stranded costs for 2009:
- on June 4, 2012 CCCP allowed the appeal of PGE GiEK S.A. Branch ZEDO and changed President of the Energy Regulatory Office decision regarding settlement of value of annual adjustment of the stranded costs for 2009 for ZEDO
- on June 19, 2012 allowed the appeal of PGE GiEK S.A. Branch Elektrociepłownia Gorzów and changed President of the Energy Regulatory Office decision regarding settlement of value of annual adjustment of the stranded costs for 2009 for Elektrociepłownia Gorzów.
Generators from the PGE Capital Group are in similar disputes with the ERO President regarding stranded cost compensations for 2008 and 2010. The disputes regarding LTC compensations for 2008 are at various stages of legal proceedings, while cases regarding LTC compensations for 2010 have not been subject of the court judgement yet.
The total claim value of disputes concerning LTC compensations for 2009 due to generators from the PGE Capital Group, calculated as a difference between the amount of annual adjustment calculated by the companies and the amount settled by the ERO President in decisions, amounts to PLN 672.9 million. The claim value in the PGE GiEK S.A. Branch ZEDO case was PLN 93 million.
Description of the case:
On July 30, 2010, the ERO President issued decisions in relation to following generators from the PGE Capital Group: PGE Elektrownia Opole S.A., PGE Elektrownia Turów S.A., PGE Zespół Elektrowni Dolna Odra S.A., PGE Elektrociepłownia Rzeszów S.A., PGE Elektrociepłownia Lublin - Wrotków Sp. z o.o., PGE Elektrociepłownia Gorzów S.A., concerning the annual adjustment of stranded costs and annual adjustment of the cost generated in gas-fired units under the Act of June 29, 2007 on the principles of compensating for generators' costs arising in connection with the early termination of long-term contracts for the sale of capacity and electricity (Dz. U. of 2007 No. 130, Item 905, as amended). Pursuant to the decisions mentioned, the above companies were obliged to return amounts indicated in the decisions to Zarządca Rozliczeń S.A. or were given lower adjustments than expected. The companies from the PGE Capital Group appealed against the decisions of the ERO President to the CCCP.
Until the date of this report CCCP issued 2 verdicts regarding annual adjustments of stranded costs for 2009:
- on June 4, 2012 CCCP allowed the appeal of PGE GiEK S.A. Branch ZEDO and changed President of the Energy Regulatory Office decision regarding settlement of value of annual adjustment of the stranded costs for 2009 for ZEDO
- on June 19, 2012 allowed the appeal of PGE GiEK S.A. Branch Elektrociepłownia Gorzów and changed President of the Energy Regulatory Office decision regarding settlement of value of annual adjustment of the stranded costs for 2009 for Elektrociepłownia Gorzów.
Generators from the PGE Capital Group are in similar disputes with the ERO President regarding stranded cost compensations for 2008 and 2010. The disputes regarding LTC compensations for 2008 are at various stages of legal proceedings, while cases regarding LTC compensations for 2010 have not been subject of the court judgement yet.
Signatures of persons representing the company
| Date | Name | Position and function |
|---|---|---|
| 2013-01-17 16:01:56 | Krzysztof Kilian | President of the Management Board |
| 2013-01-17 16:01:56 | Wojciech Ostrowski | Vice-President of the Management Board |