The Court of Competition and Consumer Protection agreed with appeals of PGE Group regarding the settlement of value of annual adjustment of the stranded costs for 2008.

The Management Board of PGE Polska Grupa Energetyczna S.A. („PGE”, the “Company”) informs that in accordance with six verdicts of Court of Competition and Consumer Protection (“CCCP”) announced on May 26, 2010, the decision of the President of the Energy Regulatory Office (the “ERO President”), regarding the settlement of value of annual adjustment of the stranded costs for 2008, due to the termination of long-term contracts of sale of capacity and electricity (so-called “LTC”) has been changed in accordance with the appeals filed by the entities from PGE Capital Group. Amount under dispute is understood as a difference between amount of adjustment calculated by the companies and amount decided by the ERO President and came to PLN 434.7 million. The sentence has been not yet final and binding.

Description of the case:

On July 31, 2009, the ERO President issued six decisions in relation to some PGE Group generation companies i.e. 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 due stranded costs, according to the Act of June 29, 2007 on coverage of stranded costs resulting at generators in relation to accelerated termination of long-term contracts (Dz. U. of 2007, No. 130, Item 905 as amended). Pursuant to the mentioned decisions, the above companies were obliged to return the indicated amounts to Zarządca Rozliczeń S.A. The mentioned companies from PGE Capital Group appealed to the decision of the ERO President to the CCCP.