TAURON to receive PLN 11bn to fund development and adaptation of electricity grid

The loan proceeds will be used to finance expenses incurred by TAURON's subsidiary, TAURON Dystrybucja S.A, for the development and adaptation of the power grid to the needs of energy transition and climate change. The loan will increase the capacity to connect more generation sources to the power grid. These investments will improve the flexibility of the grid and ensure the reliability of energy supply.

The largest part of the NIP funds will go towards investments in clean and cost-effective energy. This will amount to over PLN 100 billion. These are funds for large infrastructure investments related to the energy transition - wind power plants in the Baltic Sea, installation and service terminals, transmission and distribution networks,' said Minister of Funds and Regional Policy Katarzyna Pełczyńska-Nałęcz.

The loan will be disbursed successively, based on disbursement requests submitted by TAURON as the work financed by the loan progresses. The funds will be disbursed up to the amount of funds transferred to BGK for this purpose by the funds administrator - the Ministry of Climate and Environment.

- Today, with the largest investment financing agreement in the history of the Polish energy sector, we are launching the implementation of the Energy Support Fund, which is part of the National Reconstruction Plan. The competitiveness and innovation of our economy depend on the energy transition. Without the KPO funds at BGK's disposal, projects of this type would have no chance of being implemented on schedule. I believe that, thanks to today's agreement, the coming years will bring a dramatic improvement in the energy security of the country's southern regions, while at the same time consumers will gain new, previously unavailable opportunities to use increasingly green energy,’ says Prof. Marta Postuła, First Vice-President of Bank Gospodarstwa Krajowego.

- The energy transformation in Poland needs a strong, flexible and secure distribution network, and investments in the grid require very large financial outlays. The funds raised under KPO will allow us to develop the energy infrastructure and its integration with modern technologies. This will benefit both customers and local communities. In addition, it will increase opportunities for RES development,’ noted Grzegorz Lot, CEO of TAURON Polska Energia.

This is the first loan granted by Bank Gospodarstwa Krajowego under the KPO in the part dedicated to distribution networks and at the same time the largest loan for TAURON Polska Energia. - The funds will go to our key distribution segment, which generates the largest part of the Group's EBIDTA. In the coming years we expect a surge in demand for energy, which is why by 2035 we will have earmarked PLN 60 billion for the expansion and modernisation of the network, and this loan will significantly help us achieve that,’ said Krzysztof Surma, Vice President of the Management Board for Finance, TAURON Polska Energia.

- The terms and conditions of the loan are very attractive to us and the long, 25-year repayment period will significantly extend the average maturity of the TAURON Group's debt. Bank Gospodarstwa Krajowego is our key partner in obtaining financing for the transformation, therefore we are all the more pleased with the prospect of further long-term and fruitful cooperation in the implementation of our strategy based on strong distribution,’ added Krzysztof Surma.