PFR invests in a new unit of the Jaworzno power plant

PFR invests in a new unit of the Jaworzno power plant

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The Polish Development Fund will invest PLN 880 million in the construction of a new 910 MWe lignite-fired power unit at Jaworzno. The project is implemented by the TAURON Polska Energia S.A. Group. The investment in state-of-the-art low-emission technologies is an important part of Poland’s energy security. The agreement providing for PFR’s participation in the project was signed in the presence of the Polish Prime Minister Beata Szydło in Jaworzno on 1 June 2017.

In the investment project, funds managed by PFR will take up shares in the special-purpose vehicle Nowe Jaworzno Grupa TAURON Sp. z o.o. which has been spun off TAURON Wytwarzanie S.A. as the entity responsible for the project. The investment is expected to improve the financial standing of TAURON and enhance the investment potential of the Group.

“It is the biggest investment contract signed to date between a development institution and a company held by the State Treasury, and one of the largest investments in the Polish energy sector. With diversification, security of energy supplies, and modernisation of the energy infrastructure, the Jaworzno project is a perfect fit for the Strategy for Responsible Development. The project beneficiaries include TAURON and PFR as well as Poland’s mining industry, energy security, climate change policy, and more than 2 million households. The project demonstrates that clean coal has an environmental and business case,” said Mateusz Morawiecki, Deputy Prime Minister and Minister of Economic Development and Finance.

“The investment in the Jaworzno power unit and TAURON’s co-operation model are a perfect match for the investment strategy pursued by PFR. The energy sector is a key segment of our investments, and the Jaworzno unit is its important part due to its size, contribution to Poland’s energy security, and state-of-the-art technology which uses coal while respecting the environment,” said Paweł Borys, President of the Polish Development Fund.

The construction of the Jaworzno power plant is crucial to Poland for a number of reasons. First, it is a part of the plan to enhance Poland’s energy security and relies on coal, a commodity that Poland has in large supply. The new power unit will also create demand for 2.8 million tonnes of coal per year, providing a guarantee of jobs in the mining sector for several decades. Last but not least, the investment project demonstrates that state-of-the-art coal-fired technologies comply with the strict emission standards.

“The agreement signed today sets out the preliminary conditions of PFR’s potential investment in the project. We will now negotiate the details, but we are positive that the process of drafting of the final documentation with TAURON Polska Energia, an experienced and credible partner, will be very efficient. PFR’s participation in the project provides TAURON Group with capital and allows the Fund to generate market-based return on investment,” said Marcin Piasecki, PFR Deputy President for Investment.

The new power unit, which is expected to start up in November 2019, will have the highest net efficiency rate in its class in Poland at 45.9%. It will generate up to 6.5 TWh of electricity per year, which is equivalent to demand of 2.5 million households. Compared to 200MW units current in operation, it will comply with the strict environmental standards, reducing CO2 emissions by nearly 30% and SOx and NOx emissions by more than 50%. As required by the climate change policy, the power unit will comply with the emission standards under the BAT conclusions.

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