43. Concession arrangements on the provision on public services

The key business activities carried out by the Group include generation, distribution, trading in electricity, as well as production and sales of coal.

Enea S.A. received on 5 October 2007 a decision on extension of the validity of the concession for trading in electricity until 31 December 2025.

Pursuant to the provisions of the Energy Law, the President of the Energy Regulatory Office is responsible for granting concessions, exercising supervision over energy companies as well as approval of tariffs. Energy prices, fee rates and the principles for their application laid down in the Tariff are approved by the President of the Energy Regulatory Office based on administrative decisions. Transactions not recognized by the President of the Energy Regulatory Office as held on arms-length, are subject to the obligation to submit tariffs for the approval of the President of URE (with respect to which the President of the Energy Regulatory Office has not issued a decision exempting from the obligation to submit

tariffs for the approval). Electricity tariffs covering activities not considered by the President of the Office for Energy Regulation as carried out in competitive conditions are subject to the obligation of submitting to the President of the Office for Energy Regulation (activities for which the President of the Office for Energy Regulation has not issued a decision exempting from the obligation to submit tariffs for approval). Currently, also tariffs for natural gas for final customers are subject to the obligation of submitting to the President of the Office for Energy Regulation, however the Energy Law Act specifies a schedule of exemption from this obligation (as of 1 January 2017, sale at a virtual point of sale of compressed natural gas (CNG) and liquefied natural gas (LNG) is exempt from the tariff rules, as well as sale conducted as part of bids, auctions, and public procurement. From October 2017, prices for final customers other than customers in households will be deregulated. Gas prices for the latter will be deregulated as of 1 January 2024).

In 2016 Enea S.A. applied the following tariffs approved by the President of URE:

  • Tariff for electricity for G-tariff group, not using the right to choose the supplier, effective from 1 January 2016,
  • Tariffs for methane natural gas (effective from 20 November 2015).

On 12 September 2013 Enea S.A. received a concession for trading in gaseous fuels from the President of Energy Regulatory Office. The concession is valid from 1 January 2014 till 31 December 2030.

Spółka Enea Operator Sp. z o.o. has a concession for distribution of electricity effective tiill 1 July 2030.

Enea Wytwarzanie Sp. z o.o. is providing for commercial purposes and on their own account economic activities involving production and sale of electricity and heat production and sale. This activity is covered by the licenses granted by the President of the Energy Regulatory Office - after the merger of the companies Enea Wytwarzanie Sp. Z o.o. operates on the basis of:

Concession for electricity production WEE/115-ZTO-F/1271/W/DSW/2013/TW from 31 December 2013 valid till 31 December 2030 with subsequent amendments introduced by decision WEE/115-ZTO-I/1271/W/DSW/2015/TW dated 27 February 2015 in connection with the transformation of Enea Wytwarzanie S.A. into Enea Wytwarzanie Sp. z o.o.

Concession for heat production WCC/256-ZTO-H/1271/W/DSW/2013/TW dated 31 December 2013 valid till 31 December 2025 with subsequent amendments introduced by decision WCC/256-ZTO-J/1271/W/DSW/2015/TW dated 27 February 2015 in connection with the transformation of Enea Wytwarzanie S.A. into Enea Wytwarzanie Sp. z o.o.

Concession for transmission and distribution of heat PCC/269-ZTO-C/1271/W/DRE/2013/RK dated 31 December 2013 valid till 31 December 2025 with subsequent amendments introduced by decision PCC/269-ZTO-D/1271/W/DRE/2015/Esz dated 23 April 2015 in connection with the transformation of Enea Wytwarzanie S.A. into Enea Wytwarzanie Sp. z o.o.

Concession for electricity trading OEE/702/1271/W/2/2012/KL dated 21 December 2012 valid till 31 December 2030 with subsequent amendments introduced by decision OEE/702A/1271/W/DRE/2015/KCh dated 22 April 2015 in connection with the transformation of Enea Wytwarzanie S.A. into Enea Wytwarzanie Sp. z o.o.

Mining activity of the company Lubelski Węgiel Bogdanka S.A. for the economic mining of mineral of hard coal have to be carried out in accordance with the regulations of Geological and Mining Law. The Company has:

The concession for mining of hard coal from the deposit "Bogdanka" from seams 385, 385/2, 389, 391, covered by the mining area "Puchaczów V", issued by the Minister of the Environment No. 5/2009 of 6 April 2009. The concession is valid tilll 31 December 2031.

The concession for mining of hard coal from the deposit "Lubelskie Zagłębie Węglowe - the area of K-3" from seams 379/2, 385/2 and 391, covered by the mining area "Stręczyn" No. 3/2014 of 17 June 2014, issued by the Minister of the Environment. The concession is valid tilll 17 July 2046.

The concession for recognition of deposit of hard coal from the deposit "Orzechów" No. 29/2014/p of 14 October 2014, issued by the Minister of the Environment. The concession is valid tilll 14 November 2018. At the request of LW Bogdanka the concession was changed based on decision of 7 July 2016 for a maximum period to 14 November 2019.

The concession for recognition of deposit of hard coal from the deposit "Ostrów" No. 25/2014/p of 30 June 2014, issued by the Minister of the Environment. The concession is valid tilll 30 July 2019. The concession was changed at the request of LW Bogdanka on the basis of decision of 10 November 2015 for a maximum period till 30 July 2020.

In September 2014 LWB received a refusal on application for concession for exploitation in the areas of K-6 and K-7, where another entity has a concession for exploration. The appeal has also meet with a refusal. On 12 December 2014 the company filed a complaint against the decision refusing to grant a concession to the Regional Administrative Court in Warsaw. The case is pending.

Enea Trading Sp. z o.o. has the following concessions:

  • No. OEE/610/19120/W/2/2011/BT for trading in electricity for the period from 1 February 2011 till 31 December 2030.
  • No. OPG/214/19120/W/2/2012/ŁG for trading in gaseous fuels for the period from 27 November 2012 till 31 December 2030.
  • No. OGZ/63/19120/W/DRG/2013/KL for trading in gas with foreign customers for the period from 1 August 2013 till 31 December 2030.

MEC Piła Sp. z o.o. and PEC Sp. z o.o. in Oborniki have concessions for generation, transmission and distribution of heat till 31 December 2025. MEC Piła Sp. z o.o. has also a concession for production electricity till 31 December 2030.

MPEC Białystok Sp. z o.o. has a concession for trading, production, transmission and distribution of heat till 30 September 2018.