PGE Polska Grupa Energetyczna S.A.

Legal Proceedings Report • Jan 27, 2017

Verdict of the Supreme Court in case of thesettlement of value of annual adjustment of the stranded costs(so-called LTC compensations) for 2008 for Lublin-Wrotków CHP and for2009 for Rzeszów CHPTheManagement Board of PGE Polska Grupa Energetyczna S.A. ("PGE") disclosesthat on January 26, 2017 the Supreme Court:(1)issued a verdict in case of the settlement of value of annual adjustmentof the stranded costs (so-called LTC compensations) for 2008 for PGEGiEK S.A. Branch Lublin-Wrotków CHP,(2)issued a verdict in case of the settlement of value of annual adjustmentof the stranded costs (so-called LTC compensations) for 2009 PGE GiEKS.A. Branch Rzeszów CHP.Verdictin case of PGE GiEK Branch Lublin-Wrotków CHP was issued as a result ofexamination of a cassation appeal filed by the President of the EnergyRegulatory Office (the "ERO President") against the verdict of the Courtof Appeal of September 17, 2013. In its verdict the Supreme Court setsthe amount of annual adjustment of LTC compensations for approximately(+) PLN 8.8 million. As a result of the above verdict, PGE GiEK willreturn approximately PLN 1.3 million to Zarządca Rozliczeń S.A. (companyresponsible for LTC settlements).Verdictin case of PGE GiEK Branch Rzeszów CHP was issued as a result ofexamination of a cassation appeal filed by the President of the EnergyRegulatory Office (the "ERO President") against the verdict of the Courtof Appeal of June 6, 2014. In its verdict the Supreme Court sets theamount of annual adjustment of LTC compensations for 2009 for PGE GiEKS.A. Branch Rzeszów CHP for PLN 0 million. As a result of the aboveverdict, PGE GiEK will return approximately PLN 6.8 million to ZarządcaRozliczeń S.A. (company responsible for LTC settlements).Theabove verdicts of the Supreme Court ends the disputes between PGE GiEKS.A. and the ERO President in both cases has no impact on theconsolidated revenues of the current period.