Dear Reader,
please find below the sixth impact report of Polskie Sieci Elektroenergetyczne S.A.
This publication shows the impact of our Company on the development of the Polish economy and society, as well as financial and other data for 2022 in a synthetic manner. A key part of the report is the description of the initiatives of PSE S.A. until 2030, in particular those aimed at supporting Poland's energy transition.
In 2022, as in previous years, continuity of stable operation of the Polish power system (KSE) was of primary importance for PSE S.A., and we were successful in this task , particularly due to cooperation with power system users.
Market and investment outlook in the context of the Polish power sector transition
In 2022, work was performed to prepare a thorough reform of the balancing market, and adapt this segment to the changing conditions of the Polish power system. The developed rules were submitted for public consultation and then approved by the President of the Energy Regulatory Authority. They will enter into force on 14 June, 2024. The new balancing market rules will support the energy transition, in particular by strengthening the market integration of renewable energy sources into the Polish power system and creating economic incentives to invest in the flexibility of resources connected to the Polish power system. They will also aid the effective integration of the Polish electricity market with the European market.
In 2022, PSE S.A. completed its tasks in the capacity market. This market segment creates investment incentives for the construction of new generating capacity, the restoration of retired capacity, and the modernisation of the existing generating sources. It allows the supply side of electricity to accommodate, sufficiently in advance, consumers’ future demand for electricity. The generating capacity contracted in the capacity market provided the basis for continuous supply of electricity to domestic consumers in 2022, guaranteeing a safe energy transition.
A prerequisite for an effective energy transition is the adequate development of power grids, in particular the transmission networks owned and managed by PSE S.A. We are currently implementing the largest investment program in our history, for which we plan to allocate more than PLN 60 billion in the period up until 2036. The program includes the construction of: (i) 4875 km of new 400 kV AC lines, (ii) 233 km of new 220 kV AC lines, and (iii) 3 converter stations, as well as 775 km of new DC lines. The grid investment projects under way will allow power output from offshore wind farms in the Baltic Sea and from nuclear power plants, the integration of onshore renewable energy sources into the Polish power system, and the connection of new stable generating sources and energy storage facilities, thus helping to reduce greenhouse gas emissions.
Thanks to information technology development, it is becoming increasingly possible to collect and analyze data on electricity consumption and production. PSE S.A., as the Energy Market Information Operator, is building the Central Energy Market Information System (CSIRE). The system will streamline processes in the retail electricity market, make the market more transparent, and stimulate the development of innovative services and products. This will create conditions for the optimisation of the cost of electricity purchasing by consumers.
In parallel with the work on the Central Energy Market Information System, PSE S.A. took steps to shape the electricity consumption curve for consumers in late 2022. We identified the times of day in which to plan the use of energy-intensive equipment to reduce the operation costs of the Polish power system and protect the environment. The Energy Compass application we have provided makes it easier to use electricity reasonably day by day.
PSE S.A. plays a part in international work on solutions for the European electricity market and procedures for managing the operation of power systems. We are members of three capacity calculation regions through which the Polish energy market integrates with the markets of other European countries. Thanks to this integration, Polish electricity consumers and generators are assured access to contractors throughout the European Union, while at the same time this has also made operation of the Polish power system safer.
More than PLN 13 billion in PSE S.A. added value to the economy
We have been measuring the scale of our impact on the national economy for several years. We calculate the extent of this impact using Wassily Leontief's input–output model. The total added value generated by PSE S.A. in the national economy in 2022 was PLN 13.57 billion, which is an increase by 13.5 percent on 2021. The direct added value generated by PSE S.A. in the power sector accounted for PLN 2.6 billion. The operations of PSE S.A. have helped to maintain more than 47 000 jobs. We paid PLN 1.41 billion in taxes and contributions to the state and local government budgets, and almost PLN 360 million in taxes to municipal budgets.
We operate in a responsible and sustainable manner
This is the sixth time we have measured the carbon footprint of PSE S.A. during the reported period. In 2022, we extended the analysis of the volume of greenhouse gas emissions to include other categories. According to the location-based method, we recorded a 13 percent reduction in emissions compared to the 2017 base year, and also a three percent reduction in emissions on an annual basis. By contrast, according to the market-based method, we achieved an emission reduction of as much as 22 percent as compared to the base year and three percent relative to 2021.
More than 56 percent of greenhouse gas emissions associated with operations of PSE S.A. can be attributed to the electricity transmitted in our grids to end users. A further percentage, nearly 42 percent, is due to energy production used to cover losses incurred in the transmission process. Due to appropriate investments in grid infrastructure, the record values of transmitted electricity have not significantly increased the loss indicator.
We want to be a good neighbour to everyone. In the course of grid investments, we strive to add value by improving the quality of life of local communities. In 2022, we allocated more than PLN 5.6 million for the implementation of social projects serving local residents. We supported education, environmental protection, health promotion, education, and measures to solve inequality. We donated PLN 10.42 million to help Ukraine – both for refugees and for the reconstruction and repair of electricity infrastructure destroyed in the hostilities.
The directions and scope of development of PSE S.A. are determined by the need to ensure that the Polish power system operates safely and support the transformation of the national power sector, with particular emphasis on social and environmental aspects. Please see the detailed information on our activities in this regard in the following chapters of the online report. I recommend it.
Tomasz Sikorski
President of the Management Board
Polskich Sieci Elektroenergetycznych S.A.