Current Report No.: 32/2015
Current Report No.: 32/2015
Date of preparation: 27.08.2015
Short name of issuer: Enea S.A.
Subject: Decision of the President of the Energy Regulatory Office regarding the final adjustment of stranded costs as a part of Long-term Agreements settlement
Legal basis: Art. 56 item 1(1) of the Act on Offerings - confidential information
Content of report:
The Management Board of Enea S.A. (Issuer) informs that on 27 August 2015 the Issuer's subsidiary - Enea Wytwarzanie sp. z o.o. (Enea Wytwarzanie, Company) - received the decision of the President of the Energy Regulatory Office (President of ERO) dated 27 August 2015 relating to the determination, for Enea Wytwarzanie, of the amount of the final adjustment of stranded costs (Decision).
The President of ERO, in his Decision, determined the amount of the final adjustment of stranded costs for Enea Wytwarzanie in the amount of PLN (+)315,523,707. The Decision is final and the amount specified therein should be paid for the account of Enea Wytwarzanie by Zarządca Rozliczeń S.A. until 31 December 2015.
The decision relating to the determination of the final adjustment of stranded costs includes the circumstance that the total balance of funds paid for the account of and paid by Enea Wytwarzanie based on the act on rules of covering costs of producers in relation to a pre-term termination of long-term agreements for sale of power and electricity dated 29 June 2007 ("LTPPA Termination Act") by title of advance payments and annual adjustments of stranded costs for particular years of the adjustment period (2008-2014) will amount to PLN (+)236,095,470 nominally. In relation to the content of the Decision, the total balance of nominal amounts of advance payments, annual adjustments and final adjustment of stranded costs paid for or by Enea Wytwarzanie (the total nominal value of compensations by title of termination of Long-term Agreements) for the whole adjustment period will amount to PLN (+)551,619,177. Until the end of 2014 the Company recognised revenue from recovery of stranded costs in the amount of PLN 258,472,237.
The Issuer informs that one may appeal against the Decision relating to the determination of the final adjustment of stranded costs to the Regional Court in Warsaw - Court for Competition and Consumer Protection within 14 days of its receipt. In relation to the fact that the amount of the final adjustment determined in the Decision is acceptable for Enea Wytwarzanie, the Company does not intend to appeal against the Decision.
The Issuer reminds that due to the fact that long-term agreements for sale of power and electricity concluded by producers with PSE S.A. in the 90s. of the 20th century were deemed a prohibited public aid by the European Commission, the LTPPA Termination Act was adopted in Poland, with a view of termination of the aforementioned contracts.
Pursuant to the provisions of the act, starting from 1 April 2008, Enea Wytwarzanie was entitled to receive compensation for incurring, in the adjustment period, i.e. in the period from 1 April 2008 to 31 December 2014, the so called stranded costs, resulting from a pre-term termination of a long-term agreement. The Decision of the President of ERO setting the amount of the final adjustment specifies the final amount of compensation for recovery of stranded costs due to Enea Wytwarzanie and enables termination of proceedings relating to the determination of the amount of these compensations.
