PGE Polska Grupa Energetyczna S.A.

Legal Proceedings Report • Mar 14, 2017

Verdict of the Supreme Court in case of the settlement of value ofannual adjustment of the stranded costs (so-called LTC compensations)for 2008 for Opole power plant

In connection with the current report no. 70/2013 dated July 26, 2013about dismissal the appeal of the Energy Regulatory Office President(the "ERO President") regarding the settlement of value of annualadjustment of the stranded costs (so-called LTC compensations) for 2008for PGE GiEK S.A. Branch Opole Power Plant, the Management Board of PGEPolska Grupa Energetyczna S.A. (the "Company", "PGE") discloses that onMarch 14, 2017 the Supreme Court, as a result of examination of acassation appeal by the ERO President against the above mentionedverdict of the Court of Appeal, issued a verdict in case of thesettlement of value of annual adjustment of the stranded costs for 2008for Opole power plant.

In its verdict the Supreme Court set the amount of annual adjustment ofLTC compensations for approximately PLN (+) 129.1 million. As a resultof the above verdict, PGE GiEK S.A. will return approximately PLN 5.9million to Zarządca Rozliczeń S.A. (company responsible for LTCsettlements). The verdict has no impact on the consolidated revenues ofthe current period. The above verdict of the Supreme Court ends thedispute between PGE GiEK S.A. and the ERO President in that particularcase.