Polish Utilities Get Offer From State for Coal Assets Spinoff

(Bloomberg) -- Polish state-controlled utilities got offers from the state to buy their carbon-emitting assets, a key part of the plan to speed up the country’s transition toward cleaner energy.

The proposed deal will lead to a long-awaited transfer of their coal-fired plants and mines to a government agency called NABE. This will help the utilities access financing needed to refocus their power generation on renewable energy sources. Poland, which gets more than 70% of its electricity from coal, is under pressure to meet the European Union’s net zero emission goals.

As part of the offer, the government has proposed to pay PGE SA, Poland’s biggest power producer, 849 million zloty ($214 million) for its assets including the country’s biggest power plant in Belchatow, in return for repaying the company 5.4 billion zloty in coal plants’ debt over eight years. 

Separately, the state has valued Tauron Polska Energia SA’s coal assets at 1 zloty, but is also offering a repayment of 6.33 billion zloty in debt owed to the utility following the spinoff. Enea SA’s coal plants were valued at 3.11 billion zloty, with a promise to pay off 2.38b zloty in debt over eight years. The smallest Energa SA was offered 153 million zloty for its plants.

The offers are base for further negotiations with utilities, and the deal will only be reached if all utilities agree to the proposed spinoff.

©2023 Bloomberg L.P.