The verdict of the Court of Appeal regarding the settlement of value of annual adjustment of the stranded costs (so-called LTC compensations) for 2010 for PGE GiEK S.A. Branch Elektrownia Opole

The Management Board of PGE Polska Grupa Energetyczna S.A. (“PGE”) discloses that on April 14, 2016 the Court of Appeal in Warsaw issued a verdict in which it allowed the appeal of PGE GiEK S.A. 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 August 14, 2014, regarding the settlement of value of annual adjustment of the stranded costs for 2010 for PGE GiEK S.A. Branch Elektrownia Opole 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 Management Board of PGE expects that the verdict will have a positive impact of approximately PLN 173 million in Q1 2016 on EBIT of 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 2013, item 1382, as amended).