CEZ A.S.

Business and Financial Review • Mar 26, 2024

CEZ Group launches divestmentof selected Polish assets in line with decarbonization strategy, plansto strengthen ESCO activities in Poland

Inline with the current business strategy focused on reaching net-zero by2040, CEZ Group officially started the divestment process of severalselected companies in Poland today. After the market sounding,interested investors will be asked to present non-binding offers. CEZintends to further develop and strengthen its portfolio of energyservice companies (ESCO) in Poland. These include CEZ Energo Polska andthe companies under Elevion Group.

The divestment concerns four Polishcompanies: CEZ Skawina, CEZ Chorzów, CEZ Produkty Energetyczne Polskaand CEZ Polska. The whole sales process begins with market sounding,followed by subsequent stages. The divestment is lead exclusively by INGBank, the advising investment bank to CEZ.

The assets selected for divestment includetwo combined heat and power plants (CHPs) in the densely populated andurbanised regions of Silesia and Lesser Poland. CEZ Skawina (installedcapacity 330 MWe / 588 MWt) is the second largest provider of heat toKrakow (approx. 25% market share) and Skawina. CEZ Chorzów (238 MWe /500 MWt) is one of the largest heat suppliers to Katowice and otheragglomerations in Silesia. Last year CEZ Skawina and CEZ Chorzówproduced in total 1,390 GWh of electricity and 5,649 TJ of heat.

CEZ Produkty Energetyczne Polska providesdedicated supporting services in energy by-products. CEZ Polskaevaluates the market situation in terms of energy regulation andlegislation, provides communication, PR and public affairs activities,and ensures the corporate identity and integrity of CEZ Group in Poland.

The divestment of the above-mentionedselected Polish companies is in line with CEZ Group's business strategyfocused on decarbonization of production portfolio and reaching net-zeroby the year 2040.

CEZ wants to keep and further develop onlythose Polish companies that are focused on providing modern energyservices (ESCO). These include CEZ ENERGO Polska and the companies underElevion Group that offer end-to-end solutions for decarbonization andenergy efficiency. In Poland is Elevion Group currently represented by 4subsidiaries (Euroklimat, Metrolog, OEM Energy and TRiM-tech). Metrologis one of the leading manufacturers of compact heat substations on thePolish Energy for industry market and promotes efficiency-orientedsolutions that are aimed at eliminating fossil fuels from Poland'senergy mix. Euroklimat is a leading company with an established positionin the Polish market, operating in the construction sector as a supplierof large projects for HVAC (heating-ventilation air conditioning) andelectrical installations working for large international clients.