Polskie Sieci Elektroenergetyczne – CEO letter

Dear Sir/Madam,

I am honored to present the latest report on the impact of the operations of Polskie Sieci Elektroenergetyczne on the economic, social and environmental development of the country. The publication you have been presented with appeared at an inconvenient time when our everyday is disturbed by the COVID-19 pandemic. Despite the difficult time, we would like to proudly inform you that the strategy for 2017-2019 was largely successful: 51 out of the 62 selected initiatives were completed. 11 initiatives, due to their priority and importance, have been continued in the strategy for 2020-2030, which we present on the next pages of the publication.

The power sector is awaiting a deep transformation. The market is changing before our very eyes. The role of consumers is growing, new energy generation technologies are emerging and their share in meeting domestic demand is increasing. The European Commission and ACER promote the concept of integrated wholesale power markets on the European market, while at the same time the development of distributed, prosumer generating units and storages aimed at energy self-sufficiency of local communities takes place. Regardless of the road taken by the sector, it will remain the role of the transmission system operator to ensure the current security of energy delivery.

We are working on a model of providing added services to the transmission service, increasing the standard of security and quality of electricity supplies – among others, services ensuring cyber security of consumer systems and those to make the power system resistant to hazardous and emergency conditions. All these issues form the cornerstone of the PSE strategy for 2020-2030 and are reflected in the priority initiatives of our organization.

We are proud of the positive impact of our company on the economic and civilization development of the country. To calculate it, we used the input-output analysis model by Wassily Leontief, who received the Nobel prize in economics. Direct value added generated by PSE in the power sector amounted to PLN 2.75 billion in 2019. In turn, the total added value generated by us in the domestic economy amounts to PLN 5.39 billion. The operations of PSE contributed to preserving 13.4 thousand jobs in Poland during this period. We paid PLN 942.5 million of taxes and contributions to the state budget and budgets of local government authorities, thus affecting regional development.

The objective of our organization is to ensure safe operation of the system now and in the future. We have improved the project execution model, allowing for efficient implementation of investment tasks and cost rationalization. In 2019, infrastructural investment project expenditures amounted to PLN 1.5 billion, and by the end of 2030 we will allocate a total of PLN 14 billion for this purpose.

We actively participate in developing a common European electricity market. Last year, the Polish market area was incorporated into the Single Intraday Coupling (SIDC) Mechanism, which increased the liquidity of the domestic market.

The introduction of the capacity market has changed the architecture of the energy market from energy only market to capacity market, in which not only the generated electricity is subject to transactions, but also the net available capacity, i.e. readiness for energy delivery. As the capacity market administrator, in 2019 PSE conducted general certification, certification for the main auction and the main auction for 2024 supplies.

As a socially responsible company, we think about the future and the next generations. We implement all investment projects in a manner allowing for the minimization of the hazards for the nature and avoiding the risk of loss of biodiversity. In 2020 PSE received a certificate confirming effective maintenance of the implemented integrated environmental and OH&S management system. We have been measuring the carbon footprint of our organization for three years. In the last audited year, we recorded emission reduction by 12% in relation to the year in which we calculated emissions for the first time. This is due to a large extent to the reduction of electricity losses during its transmission, achieved owing to investments in new infrastructure and modernization of equipment.

In our day-to-day business we address with care and understanding the quality of life and development of local communities and we strive to be a good neighbor. We conduct a dialog with the residents of the regions where we implement infrastructural investment projects. In the years 2016-2019, nearly 2.6 thousand meetings with residents were held, of which 746 were held in 2019. We implement many initiatives for municipalities where our transmission infrastructure is or will be located. Our flagship project is a grant-based education program “Wzmocnij swoje otoczenie” [Enhance your surroundings], from which more than 110 thousand people have benefited already. During the last, difficult period, we have added another number of actions - we have started cooperation with health care institutions. Due to that, the Voivodeship and District institutions from the Wielkopolskie Voivodeship received, among others, respirators, cardiomonitors, pulse oximeters and vital signs monitors for patients, and as part of the action “DajemyGminomMoc” [Filling Poland with Power], more than 40 local governments received personal protection equipment.

The publication you are reading is the sixth social report of our organization and the third PSE impact report. It has always been developed on the basis of best practices and international standards and has undergone external verification. For your convenience, we present the data in an interactive form, and in the interest of the environment, the report is published in a digital version for the fourth time.

PSE and its employees hope that you will enjoy your reading.

Letter by the President