TAURON determined the conditions for potential financing of construction of a new unit in Jaworzno by the Polish Development Fund

08.06.2017, 10:40

TAURON Polska Energia signed a memorandum of understanding with the Polish Development Fund (PFR) determining the preliminary terms and conditions of involvement in the implementation of the construction of the new 910 MW power unit in Jaworzno. The PFR expressed its preliminary interest in investing the amount of PLN 880 million.

- The construction of the unit with the capacity of 910 MW in Jaworzno is currently the largest investment implemented under the ambitious investment programme of the Group. Thinking of TAURON Group’s development and energy security from a long-term perspective, we systematically invest in new generation capacity, simultaneously taking care of the adequate modelling of the financing structure allowing to keep debt at a safe level and, consequently, to maintain financial stability – stresses Filip Grzegorczyk, the President of the Management Board of TAURON Polska Energia.

Formally, the parties to the memorandum of understanding include TAURON Polska Energia S.A. and Infrastructural Investment Fund - Equity Closed-End Investment Fund of Non-public Assets [Fundusz Inwestycji Infrastrukturalnych – Kapitałowy Fundusz Inwestycyjny Zamknięty Aktywów Niepublicznych] and Infrastructural Investment Fund - Debt Closed-End Investment Fund of Non-public Assets [Fundusz Inwestycji Infrastrukturalnych – Dłużny Fundusz Inwestycyjny Zamknięty Aktywów Niepublicznych] whose part of the investment portfolio is managed by Polski Fundusz Rozwoju S.A.

Pursuant to the Memorandum of Understanding, the Funds expressed their preliminary interest to invest the total amount of PLN 800 million in the Project through the acquisition of new shares by the Funds in the special purpose vehicle - Nowe Jaworzno Grupa TAURON sp. z o.o., currently a single-person TAURON Polska Energia company implementing the Project.

The Nowe Jaworzno Grupa TAURON company was established through the separation of an organised part of the enterprise from TAURON Wytwarzanie and started its operation on 3 April. Establishing of a separated entity dedicated to the implementation of a single, specific investment will enable to change the existing model of financing the construction of the 910 MW Unit which will consequently allow for reducing the impact of expenditure associated with this investment on the balance sheet of TAURON Group.

The new TAURON Group's 2016-2025 Strategy assumes that the implementation of the construction of the 910 MW Unit in Jaworzno will be carried out under a new financing formula based on acquisition of shares of the Nowe Jaworzno Grupa TAURON company by external partners, with the assumption of TAURON Polska Energia maintaining the controlling interest of the Nowe Jaworzno Grupa TAURON company.
The memorandum of understanding regulates key terms and conditions of potential cooperation and expresses the parties’ intention to carry out negotiations in good faith. The accession of the Funds to the Project will depend on results of the detailed analysis of the Project by the Funds, agreement by the parties and fulfilment of the conditions defined in the transaction documentation as well as the acquisition of required investment approvals by the Funds to participate in the Project.
The memorandum of understanding shall be effective until 31 December 2017.
The current progress of the construction of the new unit in Jaworzno exceeded 33%.
The unit with the efficiency of 45.9% net is constructed in coal technology at supercritical parameters, with power evacuation by 400 kV line connected to the National Power System. Planned annual coal consumption will amount to 2.8 million tonnes. The fuel will mostly originate from coal mines of TAURON Group. The unit will generate up to 6.5 TWh of electricity per year, which corresponds to the demand of 2.5 million households.

After completion of the investment, due to over 10% growth in efficiency in relation to units commissioned in the 1970s and 1980s, 2 million tonnes less of CO2 will be emitted to the atmosphere, and within the requirements of the climate policy, the unit will be prepared for construction of the installation for CO2 capturing from flue gas (CCS ready).

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