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Home › Dodgy Deals ›
Dodgy Deal
Energa GroupPoland

Company – On record

This profile is no longer actively maintained, with the information now possibly out of date
Lead organisation:
BankTrack
Work partners:
Fundacja "Rozwoj TAK - Odkrywki NIE"
Contact:

Diana Maciaga, Climate Campaigner at Pracownia na rcecz Wszystkich Istot (Association Workshop for All Beings)

Last update: 2021-01-13 00:00:00
Energa Group head offices in Gdansk. Photo: www.energa.pl free of use

Company – On record

This profile is no longer actively maintained, with the information now possibly out of date
Lead organisation:
BankTrack
Work partners:
Fundacja "Rozwoj TAK - Odkrywki NIE"
Contact:

Diana Maciaga, Climate Campaigner at Pracownia na rcecz Wszystkich Istot (Association Workshop for All Beings)

Last update: 2021-01-13 00:00:00
Why this profile?

Why this profile?

Energa S.A. in cooperation with Enea S.A. is constructing a new 1 GW gas-fired power plant Ostrołęka C.

About
Sectors Coal Electric Power Generation , Biomass Electric Power Generation, Electric Power Distribution, Hydroelectric Power Generation, Wind Electric Power Generation
Headquarters
Ownership
listed on Warsaw Stock Exchange

PKN Orlen is the majority shareholder with (90.9%), with Norges Bank (1.92%) OFE Metlife (1.71%) and OFE Nationale-Nederlanden (1,45%) as some of the other shareholders. Energa's complete shareholder structure can be viewed here.

Subsidiaries
Energa Elektrownie Ostroleka SA – Poland
Energa Finance AB – Sweden
Energa Operator – Poland
Website http://grupa.energa.pl

The Energa Group is a Polish energy company. Its core business entails the distribution, generation and sale of electricity. Energa is one of the four largest energy companies in Poland and the third distribution system operator (DSO) in Poland in terms of volume of electrical energy supplied to end-customers. Energa operates coal, hydropower, wind, biomass, and photovoltaic power plants with a total installed generation capacity of approximately 1.38 GW. Energa's electricity generation is 61% based on fossil fuels. This percentage share will increase if Energa starts operating the new 1,000 MW Ostrolęka C gas power plant. In 2019, the company held assets totalling PLN 20.97 billion (USD 5.64 billion).

What must happen

Financial institutions should avoid financing Energa via corporate loans and bonds while the company is pursuing its plans for the Ostroleka gas power plant. The loans provided by the European Investment Bank (EIB), the European Bank of Reconstruction and Development (EBRD) and Nordic Investment Bank should be terminated due to the serious possibility of usage of those funds for the Ostroleka C plant.

Impacts

Social and human rights impacts

Studies have estimated that Energa's plants contribute significantly to the deterioration of health in Poland. The pollution emitted by the Ostrołęka A (decomissioned) and Ostrołęka B power plants was estimated to result in 129 premature deaths annually, 1,370 years of life lost and more than 30,000 lost work days. The Elbląg plant is estimated to contribute to 16 premature deaths each year, 165 years of life lost and about 3,500 lost work days. The planned Ostrołęka C gas power plant would further increase these impacts.


Environmental and climate impacts

Energa operates coal, hydropower, wind, biomass, and photovoltaic power plants with a total capacity of approximately 1.38 GW. Energa's electricity generation is 61% based on fossil fuels. This share will increase when Energa starts operating the new 1,000 MW Ostrołęka C gas power plant.

Energa's main impact on the environment and climate change is related to its contribution to overall Polish CO2 emissions (in 2018 these amounted to 334 million tonnes). Energa's two main facilities (Ostrołęka A+B and Elblag) emit a lot of air pollutants. Each year together they produced almost 11,000 tonnes of SO2 and 5,500 tonnes of nitrogen oxides (Greenpeace Wegiel Zabija report). These pollutants not only harm people's health, but also corrode buildings and damage the environment by causing deforestation and acidifying waterways to the detriment of aquatic life.

The intense water usage and waste dumping at the Ostrołęka power plants have also led to the polluting of local water sources – most notably the Narew river – by heavy metals such as: cadmium, nickel, zinc, copper, chromium, cobalt and lead. Recent studies show that the Narew river is contaminated beyond the 'l geochemical' class with cadmium segments. The Narew's aquatic flora is polluted by a high accumulation of zinc, lead and chromium in the underwater roots parts.

Financiers

BNP Paribas, Bank of America and HSBC all have ties to Energa Group given their arranger roles for a March 2013 Eurobond issue for Energa. The EIB, the EBRD and the Nordic Investment Bank have provided loans since 2009 for distribution and the company's development of renewables. Polish banks: PKO BP, Pekao S.A. and Bank Gospodarstwa Krajowego (BGK) have all provided loans to ENERGA in the last three years.

BNP Paribas and JPMorgan Chase also arranged a new bond issuance in February 2017. Despite Energa acting CEO stating that the company could issue eurobonds to finance the Ostroleka C project at that time, it stated a few days later that the use of proceeds of this eurobond would not be used for new coal power generation projects. But there is no way to verify this statement, and a Reuters article a few weeks later confirmed that such a bond issuance helps the company to find money for coal projects.

Institution type
Finance type
Year
Projects
There are no active project profiles for Energa Group now.

Ostroleka C power plant

Poland
Project
On record
Coal Electric Power Generation | Gas Electric Power Generation

Ostroleka C power plant

Poland
News
BankTrack
Partners
Blog
External
BankTrack news BankTrack blog Partner news Partner blog

CBA in the house of a PiS MP. Detention of persons associated with the Ostrołęka Power Plant

2020-09-08 | Poland | Polish News
BankTrack news BankTrack blog Partner news Partner blog

Poland’s Energa writes down EUR 200m on coal plant

(Montel) Polish utility Energa reported EUR 200m in impairments on its 1 GW coal-fired Ostroleka C project due to the earlier decision to scrap it.
2020-07-24 | Poland | montelnews.com
BankTrack news BankTrack blog Partner news Partner blog

Poland’s Energa writes down EUR 200m on coal plant

(Montel) Polish utility Energa reported EUR 200m in impairments on its 1 GW coal-fired Ostroleka C project due to the earlier decision to scrap it.
2020-07-24 | Poland | montelnews.com
BankTrack news BankTrack blog Partner news Partner blog

Polish Briefing: “Ostrołęka C power plant should convert coal into gas. Orlen can become its partner”

2020-06-03 | Poland | BiznesAlert
BankTrack news BankTrack blog Partner news Partner blog

Energa abandons Ostrołęka C coal power plant construction

2020-06-03 | Poland | Europe Beyond Coal
BankTrack news BankTrack blog Partner news Partner blog

PLN1 billion hit for companies as Poland’s newest coal project becomes stranded asset

2020-05-21 | Poland | WorldCoal
BankTrack news BankTrack blog Partner news Partner blog

Polish energy giants abandon coal-fired power plant project. Has the country turned a corner?

2020-05-21 | Poland | Emerging Europe
BankTrack news BankTrack blog Partner news Partner blog

Energa and Enea valued coal Ostrołęka C at 0 PLN

2020-05-20 | Poland | BiznesAlert
BankTrack news BankTrack blog Partner news Partner blog

Energa and Enea valued coal Ostrołęka C at 0 PLN

2020-05-20 | Poland | BiznesAlert
BankTrack news BankTrack blog Partner news Partner blog

Poland's PKN prefers gas as fuel for new Ostroleka power plant

2020-05-19 | Poland | Reuters
BankTrack news BankTrack blog Partner news Partner blog

PKN Orlen, Energa on course to forming strong, multi-energy concern

2020-04-27 | The First News
BankTrack news BankTrack blog Partner news Partner blog

Back to square one – will the Ostrołęka C power plant run on gas?

2020-02-27 | Poland | BiznesAlert
BankTrack news BankTrack blog Partner news Partner blog

Polish Firms Suspend Financing For New Coal Plant, In Latest Sign That King Coal Is Slipping

2020-02-15 | Poland | Forbes, Scott Carpenter
BankTrack news BankTrack blog Partner news Partner blog

Green groups welcome suspension of 1 GW Polish coal plant

2020-02-14 | Montelnews.com
BankTrack news BankTrack blog Partner news Partner blog

Investors welcome Poland's decision to freeze last coal-fueled plant project

2020-02-14 | Poland | Reuters
BankTrack news BankTrack blog Partner news Partner blog

Conclusion of the Memorandum of Understanding on Further Actions within the Ostrołęka C Project between Energa and Enea

2020-02-13 | Energa press release
BankTrack news BankTrack blog Partner news Partner blog

Replacing coal with gas may delay Poland's planned power plant in Ostroleka

2020-02-11 | Poland | Reuters
BankTrack news BankTrack blog Partner news Partner blog

Energa & Enea power would have to make potential changes to Ostroleka project asap - dep. minister

2020-01-17 | Poland | PAP biznes
BankTrack news BankTrack blog Partner news Partner blog

Energa power sacks CFO Jacek Koscielniak

2020-01-16 | Poland | PAP biznes
BankTrack news BankTrack blog Partner news Partner blog

The dream of “Poland’s last coal plant” is turning into a nightmare

2020-01-08 | Poland | News From Poland, K. Baca-Pogorzelska
BankTrack news BankTrack blog Partner news Partner blog

Energa power appoints Jacek Golinski as new CEO - filing

2019-12-14 | Poland | PAP biznes
BankTrack news BankTrack blog Partner news Partner blog

Energa & Enea power will stay course w/ Ostroleka block, still scrounging cash - deputy PM

2019-12-12 | Poland | PAP biznes
BankTrack news BankTrack blog Partner news Partner blog

OPINION PROFILE: PKN Orlen launches tender offer for Energa at PLN 7 per share

2019-12-06 | Poland | PAP biznes
BankTrack news BankTrack blog Partner news Partner blog

Enea & Energa power reportedly abandon Ostroleka project - media

2019-12-04 | Poland | PAP biznes
BankTrack news BankTrack blog Partner news Partner blog

Update: Energa denies plans to abandon Ostroleka C block construction - press release

2019-12-04 | Poland | PAP biznes
BankTrack news BankTrack blog Partner news Partner blog

Energa and Enea power may face PLN 8-9 bln in Ostroleka C block cost - DevelopMin

2019-12-02 | Poland | PAP biznes
BankTrack news BankTrack blog Partner news Partner blog

Update: Enea & Energa utilities expected to complete Ostroleka C project with outside help - Fitch

2019-11-28 | Poland | Polish Press Agency
BankTrack news BankTrack blog Partner news Partner blog

Santander criticised for investments in Polish coal expansion

2019-10-17 | Environmental Finance
BankTrack news BankTrack blog Partner news Partner blog

Santander criticised for investments in Polish coal expansion

BankTrack quoted
2019-10-17 | Environmental Finance
Blog
BankTrack news BankTrack blog Partner news Partner blog

How long will Santander continue to profit from Polish coal expansion?

The Spanish bank's use of ‘ESG loans’ for companies with fossil fuel expansion plans is part of a dangerous new trend
2019-10-16 | Greig Aitken – BankTrack, Kuba Gogolewski – Development YES Open-Pit Mines NO
BankTrack news BankTrack blog Partner news Partner blog

Court win in world-first climate risk case puts future of Ostrołęka C coal plant in question

2019-08-01 | ClientEarth
BankTrack news BankTrack blog Partner news Partner blog

Major court win shows power of corporate law to fight climate change

2019-08-01 | ClientEarth
BankTrack news BankTrack blog Partner news Partner blog

Polish court rules against Enea coal plant plan

2019-08-01 | Financial Times
Blog
BankTrack news BankTrack blog Partner news Partner blog

Commerzbank’s Polish subsidiary under fire for major polluter bond issue

2019-07-16 | Diana Maciaga – Association Workshop for All Beings
BankTrack news BankTrack blog Partner news Partner blog

World-first climate risk case launched over major coal plant in Poland

Polish energy company Enea is facing a world-first legal challenge for pushing ahead with a controversial coal power plant despite widespread market concern about its exposure to climate-related financial risks. It is the first time a company will have to defend itself in court over a failure to manage material climate-related financial risk when making a major investment decision.
2018-10-29 | Poland | Client Earth
BankTrack news BankTrack blog Partner news Partner blog

Investor LGIM-lack of funds for Poland's planned Ostroleka coal plant a concern

WARSAW, Oct 17 (Reuters) - Legal & General Investment Management, Britain’s largest asset manager, said it is has serious concerns over Poland’s planned development of a new coal-fuelled power plant in Ostroleka due to unsecured financing for the 6 billion zlotys ($1.61 billion) project.
2018-10-17 | Poland | Reuters
BankTrack news BankTrack blog Partner news Partner blog

'Last Coal Plant In Poland' Shows How Carbon Restrictions Can Clean Up Power Sector

As Poland gears up to host the next United Nations climate change summit in December, it is also preparing to build a 1GW coal-fired power plant that could end up costing investors or Polish taxpayers billions of euros.
2018-09-07 | Poland | Mike Scott, Forbes.com
BankTrack news BankTrack blog Partner news Partner blog

New Polish coal plant to become political poisoned chalice

As Energa, one of the four largest energy providers in Poland, prepares to greenlight the construction of the EU's last sizeable hard coal plant, a new report is highlighting that it stands no chance of being profitable, leaving the investment looking more like a political fix for Law and Justice MPs ahead of upcoming local elections.
2018-08-30 | Poland | elektrowniaostroleka.com
BankTrack news BankTrack blog Partner news Partner blog

Ostrołęka C: Burning More Money Than Coal

2018-08-29 | Carbon Tracker
BankTrack news BankTrack blog Partner news Partner blog

Poland’s ‘last coal power plant’ faces €1.7 billion loss, analysts say

The planned phase-out of state aid to fossil fuel power generation across the European Union could make the Ostrołęka C coal station project unprofitable within years, according to a new report by Carbon Tracker, a think tank.
2018-08-29 | Poland | Frédéric Simon, EURACTIV.com
BankTrack news BankTrack blog Partner news Partner blog

The last coal power plant in Poland may be only wishful thinking

The Polish Ministry of Energy wants to build a new coal-fired power plant for € 1.5 billion. This project, however, has reached an invincible barrier – no one is willing to finance it.
2018-08-27 | Poland | Rafał Zasuń, Wysokienapiecie.pl
Blog
BankTrack news BankTrack blog Partner news Partner blog

Out of sync with climate reality – the coal mine and coal plant dreams of Poland's two dirty utilities

2018-02-26 | Warsaw | Katarzyna Kubiczek, Ecological Association EKO-UNIA
BankTrack news BankTrack blog Partner news Partner blog

Three groups offer to build Polish 1,000 Mw coal-fired power plant

2017-12-29 | ETEnergyworld.com
BankTrack news BankTrack blog Partner news Partner blog

Energa : and Enea signed the investment agreement on Ostrołęka C Power Plant

2017-02-01 | 4-Traders.com
BankTrack news BankTrack blog Partner news Partner blog

Poland's 1 GW hard coal Ostroleka power unit approved

2017-01-18 | S&P Global Platts
BankTrack news BankTrack blog Partner news Partner blog

Polish Enea, Energa sign deal to build Ostroleka power plant

2016-12-08 | Reuters
Resources
Documents
Links
2019-07-08 00:00:00

Answers to the questions submitted by Shareholders during the Annual General Meeting of ENERGA SA on 25 June 2019

Assumptions for the future and sensitivity analysis
Company document
2019-07-08 00:00:00 | Energa SA
2019-07-08 00:00:00

Answers to the questions submitted by Shareholders during the Annual General Meeting of ENERGA SA on 25 June 2019

Company document
2019-07-08 00:00:00 | Energa SA
2018-12-28 00:00:00

Capacity market and the failed rescue

Updated report: Ostrołęka C - next steps for Europe’s last coal power plant
NGO document
2018-12-28 00:00:00 | Michał Hetmański, Instrat Foundation
2018-05-24 00:00:00

The risk analysis related to the Ostrołęka C Power Plant development

by professor Jan Popczyk, Krzysztof Bodzek PhD, Silesian University of Technology
NGO document
2018-05-24 00:00:00 | Stowarzyszenie Pracownia na rzecz Wszystkich Istot
2018-08-16 00:00:00

EuroRating downgrades Energa's rating to BBB-

(press release in Polish)
Other document
2018-08-16 00:00:00 | EuroRating agency
2018-08-29 00:00:00

Ostroleka C – Burning more money than coal

NGO document
2018-08-29 00:00:00 | Carbon Tracker
2018-08-31 00:00:00

Ostrołęka C - next steps for the last Europe’s coal power plant

Michał Hetmański, Instrat Foundation
NGO document
2018-08-31 00:00:00 | Association Workshop for All Beings, Instrat Foundation
2018-05-24 00:00:00

Ostrołęka C – the investment rationale, and why is the project not rational at all

by Michał Hetmański and Filip Piasecki, Instrat Foundation
NGO document
2018-05-24 00:00:00 | Stowarzyszenie Pracownia na rzecz Wszystkich Istot
2013-12-31 00:00:00

Greenpeace Wegiel Zabija (Coal Kills) Report

(in Polish)
NGO document
2013-12-31 00:00:00 | Greenpeace
2018-01-30 00:00:00

Energa Annual Report 2016

Annual report
2018-01-30 00:00:00 | Energa Group
2018-01-30 00:00:00

Energa CSR report 2015

Annual report
2018-01-30 00:00:00 | Energa Group
2016-10-31 00:00:00

Lifting Europe's Dark Cloud

How cutting coal saves lives
NGO document
2016-10-31 00:00:00 | EEB, Climate Action Network, HEAL, Sandbag, WWF
2016-06-30 00:00:00

Europe's Dark Cloud

How coal-burning countries are making their neighbours sick
NGO document
2016-06-30 00:00:00 | Climate Action Network, HEAL, Sandbag, WWF

Stop Ostrołęka C Power Plant campaign

Energa S.A.

Energa's CSR

Updates

2020

2020-05-19 00:00:00 | PKN Orlen will engage in Ostrołęka C power plant only if it uses gas-based technology

PKN Orlen announced that it will only invest in building a power station in Ostroleka if it uses gas. “We cannot act in isolation from market trends and European Union’s regulatory policies. The investment in Ostroleka will be conducted but it has to be based on gas technology,” Chief Executive Daniel Obajtek said in a statement.

2020-05-07 00:00:00 | Extension of the analyses period within the Ostrołęka "C" Project

On 7 May 2020 companies Energa SA and Enea S.A. decided to extend the analytical period regarding further actions of the Ostrołęka “C” Power Plant construction project with a capacity of approx. 1,000 MW, which according to the original assumptions of the utilities, were to be completed by 7 May 2020. The companies assume that analysis will last about a month.

2020-04-30 00:00:00 | PKN ORLEN closes the acquisition of the ENERGA Group

​PKN ORLEN has acquired an 80% interest in the ENERGA Group, conferring approximately 85% of total voting rights at its general meeting, in a transaction that has formally made PKN ORLEN the owner of the Gdańsk-based company. The acquisition was the largest transaction of its kind on the Polish fuels and energy market. It took only four months to complete. During that period, PKN ORLEN met all conditions precedent necessary to carry out the acquisition, including reaching the 66% threshold for shares subject to the tender offer. Their final price was set at PLN 8.35 per share.

2020-04-27 00:00:00 | PKN ORLEN about to close the largest transaction on Poland’s energy market

Within no more than four months PKN ORLEN fulfilled all conditions precedent to the acquisition of the ENERGA Group, including reaching the threshold of 66% of shares covered by the tender offer.
The combined business will have an even greater investment potential. In accordance with the declaration made in agreement with the State Treasury, PKN ORLEN will continue the strategic projects of the Gdańsk-based group, with the proviso that the terms on which they will be continued will be subject to a review.
At the same time, the Company plans to further develop the areas in which ORLEN and ENERGA are already active (e.g. electromobility), but also to take on new projects, such as offshore wind farms.

2020-03-31 00:00:00 | PKN ORLEN closer to take over the ENERGA Group

​The European Commission has given its unconditional approval for PKN ORLEN’s plan to take over the ENERGA Group.

2020-02-23 00:00:00 | Analysis of technological, economic, financial and other aspects of Ostrołęka C to be completed by May 7 2020

The Management Board of Energa informs that on 21 February 2020 the companies ENERGA and ENEA signed the Arrangements on the analyses during the suspension of work on the Ostrołęka Project "C". The Arrangements determine the detailed scope and schedule of analyses of technical, technological, economic, organizational and legal aspects as well as financial aspects of the Project. According to the Sponsors' assumptions, the multi-stage analysis process will be completed until 7 May 2020.

2020-02-14 00:00:00 | Enea and Energa Group announce Ostroleka C coal power plant suspended

The Management Board of Energa announced that on February 13, 2020 an Agreement Concerning Further Activities in the Ostrołęka Project C was concluded between Energą and Enea. They decided to suspend financing for the project for the construction the planned Ostrołęka C coal power plant (Energa press release).

2019

2019-08-27 00:00:00 | Poland's first free online calculator shows coal Ostroleka C’s (un)viability

Instrat analysts published an open-source online viability (NPV) calculator of the coal power plant Ostroleka C. So far, four studies on Ostroleka C have been published showing a loss between PLN 2.3 billion to over PLN 6.2 billion negative NPV - much more than the investment CAPEX. The latest update sheds an even more negative light on the project - the baseline scenario suggests a loss of PLN -7.5 bn and electricity price of 500 PLN/MWh (LCOE, 117€/MWh). That is a third more than the electricity cost from photovoltaics (360 PLN/MWh) and almost twice of onshore wind farms (260 PLN/MWh, IRENA). The model gives a detailed overview of the economic situation of all similar new coal-fired power plants in Poland and Europe. The model is based on CC-BY SA 4.0 license.

2019-03-14 00:00:00 | Tempus challenges European Commission’s approval of Polish energy subsidy scheme

Ostrołęka C's capacity contract might be at risk as UK's Tempus challenges European Commission’s approval of Polish energy subsidy scheme, claiming it shuts cleaner, cheaper technologies out of the market and deprives European consumers of a better future. Polish state-run utility companies Enea and Energa said that the subsidies from capacity market would help to finance the new coal-fired unit in the northeast of Poland.

2019-02-07 00:00:00 | New controversies yet still no financing model

According to the report published by Energa, the financing model for Ostrołęka C project was to be completed by January 28th 2019.  The deadline wasn't met yet there has been no announcement from any of the two investors regarding financing. Interestingly, new information has been revealed by the Polish press. 

According to Newsweek.pl the head of the department responsible for investment risk assessment in PZU – the largest Polish insurer which could provide insurance for Ostrołęka C – is no other than Konrad Tchórzewski, son of the minister for energy. The newspaper also undermines the Ministry for Energy's position that this power plant will be beneficial for Poland: the Americans and the French will earn money on the construction, while Russia will provide coal. What the Poles will get are fines for tons of CO2 emissions and expensive electricity.

Dziennik Gazeta Prawna speculates that construction costs may increase from 6 to 8 bln PLN (1.4 to 1.86 bln EUR). In order to reduce them GE Power/Alstom Power, the consortium chosen to be the general contractor, could well hire a subcontractor from China. According to the newspaper's source it could be China Energy Construction Group.

2019-01-15 00:00:00 | Coal could be falling from sky, and Ostrołęka C still would not be viable - new study shows

Shortly after the results of Polish capacity market auctions were released, an updated version of the viability study of Ostrołęka C once again showed that burning coal is economic nonsense. Despite a vast subsidy of 2.7 bn PLN (0.6 bn EUR) and 15-year long contract, the unit would still bring no profit at all for the investors. The project would bring investors a negative net present value (NPV) of ca. -6.2 bn PLN (-1.5 bn EUR), compared to -2,3 bn PLN as the previous report showed. This exceeds the investment budget of ca. 6 bn PLN (1.4 bn EUR).

An updated version of the report “Capacity market and the failed rescue. Updated report: Ostrołęka C - next steps for Europe’s last coal power plant” by Michał Hetmański from Instrat Foundation embeds latest events and data into the model: capacity market auctions results, reform of the ETS framework and the recently published Polish Energy Policy 2040. Results of the study clearly show deep unviability of the Ostrołęka C project.

Full Report available in Polish, with executive summary in English.

2018

2018-12-30 00:00:00 | Financing model for Ostrołęka C to be announced on January 28, 2019

According to report published by Energa an agreement was signed, the intention of which is to conclude a new investment agreement specifying the terms of cooperation between the Issuer and ENEA S.A. and financing the Ostrołęka C Power Plant ("Project") in the Construction Phase. ENERGA S.A. and ENEA S.A. declared a financial commitment to the amount of: ENEA PLN 1 billion, ENERGA not less than PLN 1 billion and other investors - in the remaining scope necessary to cover the Project's financial outlays

The schedule and terms of financial involvement of individual entities will be agreed by January 28, 2019. Energa will inform the conclusion of an agreement or agreements regarding the financing of the Project in a separate current report.

2018-12-29 00:00:00 | Management Board of Elektrownia Ostrołęka Sp. z o.o. on the issue a notice to proceed related to the construction of Ostrołęka Power Plant C

On 29 December 2018 the Management Board of ENERGA SA received information that on 28 December 2018 the Extraordinary General Meeting of Shareholders of Elektrownia Ostrołęka Sp. z o.o. had granted its consent to the issue a notice to proceed ("NTP") related to the construction of Ostrołęka Power Plant C with a capacity of 1,000 MW.

On 28 December 2018 the Management Board of Elektrownia Ostrołęka Sp. z o.o. had issued notice to proceed related to the construction of Ostrołęka Power Plant C for the general contractor, a Consortium of GE Power Sp. z o.o. as the leader and ALSTOM Power Systems S.A.S.

2018-12-24 00:00:00 | Even with the capacity contract Ostrołęka C will not be able to cope with market realities

The auction of the capacity market for 2023 was closed with a price of PLN 202.99 per kilowatt (kW). According to preliminary results, the new Ostrołęka Power Plant unit will receive a 15-year contract. According to Carbon Tracker economists, Ostrołęka C would need subsidies from the capacity market amounting to as much as PLN 400 for each kW offered, for a period of 15 years.

According to the published preliminary results of Friday's capacity auction, Ostrołęka C power plant will receive a contract, which is a source of additional financing for the investment. However, this does not remove doubts as to the economic rationality of the project. Management of the company is not gambling and therefore the investment of Enea and Energa in the new Ostrołęka C coal unit should not be continued - says ClientEarth.

2018-12-21 00:00:00 | Ostrołęka C with 15-year capacity contract

On 22nd of December 2018 Polskie Sieci Elektroenergetyczne S.A. published initial result of the capacity market main auction for 2023, including the closing price for the capacity auction which is 202.99 PLN/kW/annum. Elektrownia Ostrołęka Sp. z o.o., in which Energa S.A. holds 50% of shares, concluded capacity agreement for 15 years with a capacity obligation of 853 MW, under which the revenues may amount to PLN 173 million per one year, starting form year 2023 (revenues over a period of 15 years, may amount to PLN 2 596 million), whereas the price of the capacity obligation for long-term capacity contracts will be subject to an annual indexation of the average annual consumer price index.

The auction closing price provided does not constitute the final capacity auction result. The final results of the capacity auction shall be announced by the President of the Energy Regulatory Office in the Public Information Bulletin on his website, on the first working day following the 21st day after the end of the capacity auction. Until then, all contracts of sale of capacity obligations are conditional.

SOURCE

2018-12-19 00:00:00 | NTP for Ostrołęka C depends on the result of the capacity auction

Energa S.A. announced that it will vote in favor of adopting a resolution on expressing consent to issue an NTP for
the general contractor of Ostrołeka C. The resolution is going to be taken under provided that during a power capacity auction with the delivery period beginning in 2023, the price obtained by ‘Ostrołęka C’ Project for the power stated
in the conditional certificate, i.e. 852,603 MW, for a period of 15 years is not lower than defined in the auction strategy.

Source

2018-12-05 00:00:00 | Minister of Energy admits that Ostrołęka C is unnecessary and economically harmful

At COP24 Climate Summit in Katowice Minister of Energy Krzysztof Tchórzewski confirmed construction of Ostrołęka C power plant to be against Poland's economic and environmental interest. Now the minister justifies it with the necessity of cooperation with the European Union and the Baltic States and by the need to "meet deadlines". Stop Ostrołęka C coalition comments: no international documents support it. The Ministry of Energy have not presented any strategic document which would confirm that the Ostrołęka C power plant is an important element in the synchronization of the Baltic States' power systems with Continental Europe - neither documents of the European Commission, nor the Polish Power Grid or the Lithuanian operator LitGrid mention it.

To the best of our knowledge, a document stating that Ostrołęka C is necessary for synchronisation with the Baltic states simply does not exist. When other arguments have failed, Minister Tchórzewski reaches for a new, irrational justification for this coal project. Claiming that building a coal power plant is required by European solidarity and, at the same time, lack of any solidarity in protecting the climate by moving away from coal is the height of hypocrisy - comments Diana Maciąga, Climate Coordinator at the Association Workshop for All Beings.

2018-10-17 00:00:00 | Investor LGIM-lack of funds for Poland's planned Ostroleka coal plant a concern

Legal & General Investment Management, Britain’s largest asset manager, said it has serious concerns over Poland’s planned development of the Ostroleka C due to unsecured financing for the project. LGIM is invested in both Enea and Energa.

“We have serious concerns about the development of a new coal plant in Poland, Ostroleka C given that they have not yet secured capacity market payments or confirmed third-party financing, (...) We don’t believe the companies should proceed with this project until they can provide us with reassuring evidence of its financial viability and the role it will play in meeting the energy security and the carbon targets in Poland and Europe,” said Meryam Omi, the head of sustainability and responsible investment strategy at LGIM.

2018-09-04 00:00:00 | Energa EGM votes for an NTP for Ostroleka C

On September 3, the Extraordinary General Meeting of Energa voted for issueing a Notice to Proceed (NTP) for the Ostrołęka C power plant. Shareholders holding 23,5 million shares voted against, 4.6 million abstained. Neither the members of the Supervisory Board nor the Management Board of the company were present, disregarding the good investor relations practices. Issuing NTP before the capacity auction (duo on December 21 2018) breaks the obligation towards Energa’s bondholders: in the Eurobonds prospectus from February 2017, Energa AB stated that an NTP would not be issued before the auction. Following the EGM decision, both Enea and Energa suffered drop in share prices.

In order for the construction works to start the same consent must be expressed by the EGM of ENEA, which is on September 24, 2018.

2018-08-30 00:00:00 | New report smashes Ostrołęka C - the power plant shows deep unprofitability

The latest report by Michał Hetmański,Instrat Foundation, "Ostrołęka C - what's next with the last coal-fired power plant in Europe?" shows complete lack of profitability of the largest new coal-fired power plant in the EU and serious legal doubts connected with it. Ostrołęka C can get only 15% of its revenues from the capacity market. Even under optimistic assumptions it will never provide investors with return on the investment. Ostrołęka C requires "adding" at least PLN 2.3 billion throughout its life cycle, i.e. an additional approx. 50% of the construction cost. In the optimistic scenario of a very slow increase in the prices of CO2 emission allowances and rapid rise in electricity prices - the power plant still turns out to be unprofitable. The power plant can generate electricity (LCOE) at a price of 488 PLN / MWh or even 505 PLN / MWh. This is much more than in the case of just recently developing polish wind farms (300), offshore farms (420) and even photovoltaic (440).

2018-07-18 00:00:00 | Energa's rating downgraded due to Ostrołeka C

On July 16 EuroRating downgraded Energa’s rating from BBB to BBB- in response to Energa signing the contract with GE Power/Alstom to build Ostrołeka C power plant.EuroRating assessed the current structure of Energa financing as relatively weak and pointed out that another large expenditure for the construction of the Ostrołęka C power plant (mainly financed by the increase in debt) will cause its further deterioration. The agency also noted that this power plant would need to use imported coal and thus harm Poland’s energy safety and advised withdrawal from this project on its early stage.

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