About PSE

We are the only electricity transmission system operator within the territory of Poland. We play a key role in efficient functioning of the Polish economy. We care about the reliability of electricity supply to all regions of the country.

We also ensure the secure and cost-effective operation of the Polish power system as part of the common European system.

About PSE

PSE – How we operate

GRI 102-1 GRI 102-6

We operate throughout the country under the name of Polskie Sieci Elektroenergetyczne Spółka Akcyjna (PSE S.A.).

Our clients are:

electricity undertakings involved in electricity generation and trading,
electricity distribution system operators ( DSO ),
final consumers connected to the transmission network.

Scale of PSE operations in numbers

GRI 102-7

EMPLOYMENT

2018

2017

Number of PSE employees

2,376

2,258

PSE Capital Group

2,495

2,348

FINANCIAL DATA

2018

2017

Net sales (in PLN m)

10,097

8,887

Net profit (in PLN m)

490

531

Total assets (in PLN m)

20,377

19,513

NETWORK INFRASTRUCTURE

2018

2017

Total length of transmission lines (in km)*

14,695

14,195

Number of transmission lines

267

258

Number of extra-high voltage substations

106

* Line length converted to 1 circuit, as at 1 January 2019.

SERVICES

2018

2017

Number of transmission service agreements with entities:

127

123

connected to the transmission network

34

33

operating in the electricity balancing market, not connected to the transmission network

93

90

2018

2017

Number of PPS access service agreements with DSOs not connected to the transmission network

158

163

Number of concluded agreements for the connection of new sources to the transmission network

31

35

Total capacity of new generating sources with connection agreements in force

15,102 MW

16,098 MW

Number of connection agreements for new generating sources for which PSE has launched investment projects involving works necessary for connection

22

24

100 percent stake is held by the State Treasury GRI 102-5

100%

The share capital of PSE is PLN

9,605,473,000.00 and has been fully paid up.

Number of agreements for the provision of demand side response services

Number of agreements concluded in 2017-2018 by programme:

Guaranteed Programme – payment for readiness and utilisation; summer package (1.07-30.09.2017 and 1.04-30.06.2018) with a guaranteed capacity volume of 361 MW	9
Guaranteed Programme; winter package (1.10.2017-31.03.2018) with a guaranteed capacity volume of 315 MW	9
Current Programme – payment for utilisation (1.07.2017-30.06.2018)	7
Total	25

Number of agreements concluded in 2018-2019 by programme:

Guaranteed Programme – payment for readiness and utilisation summer package (1.07-30.09.2018 and 1.04-30.06.2019) with a guaranteed capacity volume of 362.5 to 534.5 MW in individual hours	10
Guaranteed Programme; 2 agreements increasing capacity in the summer package (1.04-30.06.2019) to the guaranteed capacity volume of 372.5 to 558 MW in individual hours	2
Guaranteed Programme; winter (1.10.2018-31.03.2019) with a guaranteed capacity volume of 510 to 535 MW in individual hours	6
Current Programme ─ payment for performance (1.07.2018-30.06.2019)	5
Simplified Current Programme ─ payment for performance (1.04-31.12.2019)	5
Total	28

PSE Capital Group

GRI 102-45

PSE Capital Group was established to perform tasks under the Programme for the Power Sector adopted by the Council of Ministers on 28 March 2006. The Programme provided for the endowment of the transmission system operator with transmission assets, and with tools for the maintenance, operation and expansion of the assets in the form of specialised companies.

www.pse.pl

PSE Inwestycje S.A.

100%

PSE Inwestycje S.A.

A specialised company responsible for design work and the organisation and supervision of the implementation of investment projects related to the construction, expansion and upgrading of buildings for the purposes of welfare/ office and technical facilities of PSE’s transmission system. In connection with changes in the business strategy concerning PSE CG entities, as of 1 January 2019 the company suspended its business operations.

www.pse-inwestycje.pl

PSE Innovation Sp. z o.o.

100%

PSE Innovation Sp. z o.o.

An entity providing consulting services which involve analysis, research, new technologies and IT solutions in the power sector, in particular supporting PSE in implementing new technologies, as well as innovation, research and development work ensuring the secure and cost-effective operation of the PPS.

www.pse-innowacje.pl

Litpol Link sp. z o.o.

50%

Litpol Link sp. z o.o.

The company coordinated work under the Poland-Lithuania interconnection project completed in 2015, with regard to the cross-border section of the project. The works included the construction of a 400 kV two-circuit overhead line linking the power systems of Lithuania and Poland between the Alytus and Ełk Bis substations, construction of a converter station in Alytus and conversion of the Alytus and Ełk Bis substations. The company provided service only to its shareholders under a cooperation agreement which was the sole source of financing its activities. As of 1 January 2017, the entity suspended its operations for a period of two years.

Joint Allocation Office S.A.

4.6%

Joint Allocation Office S.A

A company established by 20 TSOs from the CEE and CWE regions and Norway through a merger of the auction offices Central Allocation Office GmbH and Capacity Allocation Service Company.eu S.A. The purpose for which JOA was set up was to provide the highest quality of cross-border capacity allocation services. As of 1 October 2018, the company became the only provider of such services to 22 transmission system operators from the European area, operating under EU legislation. The core service provided by JAO to PSE under the service agreement is the comprehensive organisation of cross-border transmission capacity auctions in the annual, quarterly, monthly and daily horizons. It also provides solutions in case of problems occurring in the allocation process.

www.jao.eu

TSCNET Services Gmbh

6.7%

TSCNET Services Gmbh

A development initiative of TSC covering a large part of the Continental Europe synchronous area. TSC's business objective – to improve the operational security of interconnected power systems (including the PPS) – is fully consistent with European regulations and the single European electricity market being created. In order to improve the quality of inter-TSO cooperation within TSC, 10 TSOs established the company TSCNET Services GmbH (hereinafter: TSCNET) based in Munich. The main business objective of TSNET is to provide technical support services to TSOs from TSC in the network operation management area (e.g. by coordinating the assessment of transmission system secure operation conditions) and administration area (e.g. project management, TSO support from TSC in the inter-TSO cost calculation and allocation process).

www.tscnet.eu

*Polskie Sieci Elektroenergetyczne S.A. – parent company. The company has field subunits of PSE units and PSE field job positions in Bydgoszcz, Katowice, Poznań, Radom and Warsaw

In the financial statements and in equivalent documents, PSE data is disclosed including ZKOs, but excluding the Capital Group companies.

Economic performance

GRI 103-1

We implement our strategic objectives, continuously monitoring our performance and the achievement of key economic and financial indicators. Preparing mid-term projections that make it possible to assess the capability to finance the expenditure adopted in the Investment Projects Plan, assuming full implementation of strategic objectives and operations.

GRI 201-1 GRI 102-7

Direct economic value generated taking into account income, operating costs, employee remuneration, subsidies and other investments for the community, undistributed profits, and payments to capital owners and state institutions

Income (value in PLN)

2018

2017

Income (all income and profits included in the financial statements)

10,234,389,294

9,008,390,514

Net sales

10,097,050,680

8,886,788,920

Other operating income

85,888,437

70,989,676

Financial income

51,450,177

50,611,918

Operating expenses (value in PLN)

2018

2017

Operating expenses

9,626,634,040

8,356,824,475

Operating expenses

9,478,295,377

8,168,945,261

Other operating expenses

145,827,388

178,631,777

Financial expenses

2,511,276

9,247,438

Operating expenses (taking into account the exclusions shown) (value in PLN)

2018

2017

Operating expenses (taking into account the exclusions shown)

8,950,524,427

7,737,876,016

exclusions:

Payroll, social security and other benefits

380,403,771

359,988,797

Taxes and charges

294,446,624

256,954,484

Investment in communities*

86,646

20,000

Interest expense

1,172,572

1,985,179

Payments to investors (value in PLN)

2018

2017

Payments to investors

0

Dividend

0

Payments to the state (value in PLN)

2018

2017

Payments to the state

508,814,711

483,757,322

Taxes and charges

294,446,624

256,954,484

Interest expense**

1,172,572

1,985,179

Income tax, current part

143,610,031

149,608,472

Profit distribution payment

69,585,484

75,209,187

Retained value (value in PLN)

2018

2017

Retained value

394,559,739

426,748,380

* We carry on a regulated activity, generating our core income from the transmission tariff approved by the President of ERO. In practice, this means that we have limited capabilities to develop social engagement programmes, in particular by making donations to public benefit organisations and other organisations, which influences the scale of investment in communities.

** In 2018, 69 percent of PSE’s interest expense was remitted directly to the state budget, and in 2017 it was 76 percent.

GRI 201-4 Total monetary value of financial assistance received by the organisation from government during the reporting period, including at least the value of:

2018

2017

investment grants, research and development grants, and other relevant types of grants

36,436,49

22,468,776

other financial benefits received from government

287,924

23,600

Membership of organisations

GRI 102-12 GRI 102-13

Learn about international and national industry organisations and CSR initiatives of which PSE is a member

ENTSO-E – European Network of Transmission System Operators for Electricity, an important link in building a common electricity market. ENTSO-E prepares so-called network codes which form a basis of the EU law – regulations providing common rules for the operation and management of power systems, which serve the implementation of a single electricity market in the EU. The main components of the working structure of ENTSO-E are Committees. PSE is represented on each of them:
- Market Committee
- System Development Committe
- System Operations Committee
- Research, Development and Innovation Committee
- Digital Committee
- Legal and Regulatory Group acting on comittee basis.
One of PSE's objectives in cooperation with ENTSO-E is to ensure the best possible representation of the company in the structures of the organisation, so as to ensure that PSE has a say on issues of key importance for us.

Central Europe Energy Partners (CEEP) – an international non-profit association representing the Central European energy sector, whose objective is to support the integration of the Central European energy sector within the framework of the EU common energy and security policy in the area.

Polish Committee of the World Energy Council (PC WEC) – an association representing Poland in the international organisation World Energy Council (WEC) based in London, grouping together more than 90 member states and promoting research and development in the field of energy sources, technologies for energy acquisition, conversion and transmission. For more than 90 years, the PC WEC has been representing Polish interests and promoting the Polish point of view on sustainable energy development on the international scene. The members of the Polish Committee are enterprises, associations, scientific centres and almost 100 experts from the energy sector.

Association of Polish Electrical Engineers (SEP) – a creative non-governmental organisation of a scientific and technical nature operating for social and public benefit. It is a voluntary association of electrical engineers of all specialties, whose professional activities are related to broad-based electrical engineering, as well as legal persons with an interest in its activities.

Polish Committee for Large Electric Systems (PKWSE) – one of 58 national committees operating on behalf of International des Grands Réseaux Électriques (CIGRE), the world's largest international association of experts dealing with the issue of power generation, transmission and distribution. PKWSE operates on behalf of CIGRE, promoting the activities of the associate in Poland. It is currently composed of 7 supporting members and more than 100 full members.

Polish Association for Electricity Transmission and Distribution (PTPiREE) – an organisation whose main object is to take measures towards comprehensive development and rational use of networks and facilities for the transmission and distribution of electricity. The Association seeks to initiate, promote and take advantage of technical and organisational progress in electricity transmission and distribution, and to support the development of the electricity market.

Partnership for the Implementation of Sustainable Development Goals (SDGs) – a partnership between the Ministry of Entrepreneurship and Technology and representatives of more than 100 entities, including PSE, for the implementation of the SDGs. The Sustainable Development Goals are the content of the UN Agenda 2030: Global Plan for Sustainable Development adopted by the UN in 2015, referred to in brief as “Agenda 2030”. The Agenda has set 17 Sustainable Development Goals whose implementation is to contribute to building a more sustainable future, in particular to levelling out socio-economic inequalities, with a simultaneous development combined with the preservation of the natural environment in as good condition as possible and reducing the adverse impact of climate changes.

Responsible Business Forum – the largest non-governmental organisation in the country dealing with CSR (Corporate Social Responsibility). Its mission is to promote sustainable development, inspire the business that changes the world, and to integrate people who change the business. The association was set up in 2000 on the initiative of business, academic and NGO communities, and it has the public benefit organisation status. Since 2002, the Forum has been the national partner of CSR Europe – a network of organisations promoting the concept of responsible business in Europe.

Responsible Energy – an initiative that groups together socially responsible companies from the energy sector. Its main idea is to increase the awareness of the importance of sustainable development and popularise good practices among representatives of the energy sector, students, and representatives of the administration and NGOs. Since 2010, PSE, as a signatory of the Declaration, has been implementing projects concerning e.g. transparency of operation and effective management, occupational safety and health, promotion of energy efficient solutions, cooperation with local governments, and stakeholder engagement

“Sport & Energy” Tourist and Sport Society – an organisation that has been established by PSE employees and has existed continuously since 1998. The Society pursues its statutory objectives by providing both member and non-member employees with access to sport facilities, participation in organised sport competitions, representation of PSE in sport competitions of the energy sector, and supporting the integration of company employees.