Activities in 2021
PGNiG TERMIKAS.A. is the Group’s competence centre for heat and electricity generation as well as execution of heat and power projects. PGNiG TERMIKA’s core business is the generation of heat and electricity from cogeneration sources.
The main sources of the company’s revenue are sales of heat, electricity and grid services. The company satisfies most (around 80%) of the heat demand on the Warsaw market and almost the entire demand of the district heating network. PGNiG TERMIKA is also a producer and supplier of heat and the owner of heat sources and heat networks in the towns of Pruszków and Piastów and in the Michałowice municipality.
The company is one of the largest Polish producers of electricity and heat from high-efficiency cogeneration sources.
The core business of PGNiG TERMIKA Energetyka Przemysłowa S.A. is generation and distribution of and trading in heat, distribution of electricity, compressed air and cold. PGNiG TERMIKA EP is the PGNiG TERMIKA Group’s competence centre for industrial power generation and use of methane captured from coal seam demethanation. The company operates generation assets with a total capacity of ca. 773 MWt and 185 MWe, and approximately 318 km of heat networks. The company operates in the municipalities of Jastrzębie-Zdrój, Czerwionka-Leszczyny, Knurów, Racibórz, Kuźnia Raciborska, Pawłowice, Rybnik, Wodzisław Śląski, Żory and Częstochowa, and sells its products mainly to housing cooperatives, housing communities, housing management companies (ZGMs) and mines.
The key investment projects underway in 2021 included the performance of the contract to construct a CCGT unit and a peak-load boiler house at the Żerań CHP plant (placed in service in December 2021), an investment programme to upgrade the Pruszków CHP plant (execution phase) and a programme to upgrade the Kawęczyn heat plant (contract award phase). Work is being continued on the project to construct a multi-fuel unit at the Siekierki CHP plant. In 2021, the project was revised in terms of its target fuel mix and a decision was made to fully depart from coal. In February 2021, a procedure was initiated to obtain a zoning permit. Geological and engineering documentation was drawn up and approved, and work on the building permit documentation is nearing completion. As part of future investments at the Siekierki CHP plant, in 2021 a feasibility study was carried out to upgrade the plant by the construction of a CCGT unit with a capacity of 300 Mwe to 550 MWe, gas-fired boiler units with a capacity of 520 Mwt to 650 MWt, a heat battery with a capacity of 30,000 ccm to 60,000 ccm and electrode boilers.
In 2021, PGNiG TERMIKA supplied heat to two municipal networks: the Warsaw heating network, owned by Veolia Energia Warszawa S.A., and its own heating network, covering Pruszków, Piastów, and Michałowice. The heat output in Warsaw in 2021 corresponded to the requirements set out in the annual agreement with Veolia Energia Warszawa S.A. under the multi-year contract for the sale of heat from PGNiG TERMIKA S.A. generating facilities, effective until August 31st 2028. The company also used Veolia’s network to supply heat to its own end customers (connected to PGNiG TERMIKA S.A.’s own local networks and to the networks of Veolia Energia Warszawa S.A.), based on a transmission contract (those customers are billed on different terms as they are classified in PGNiG TERMIKA’s separate tariff group – ‘OKW’).
The PGNiG TERMIKA Group includes PGNiG TERMIKA Energetyka Przemyśl Sp. z o.o., whose principal business consists in heat generation. The company, established on December 4th 2020, operates a heating network owned by Miejskie Przedsiębiorstwo Energetyki Cieplnej of Przemyśl. On April 21st 2021, PGNiG TERMIKA Energetyka Przemyśl and Miejskie Przedsiębiorstwo Energetyki Cieplnej of Przemyśl signed a Long-Term Lease Contract for the Zasanie Heat Plant in Przemyśl, under which the company took over the operation of the plant as of September 1st 2021, thus commencing its operating activity.
Licences (tariffs)
PGNiG TERMIKA holds licences for electricity generation, heat generation, heat transmission, and electricity trading. In the first nine months of 2021 – a tariff for heat generated at PGNiG TERMIKA’s heat generating sources: the Żerań CHP plant, Siekierki CHP plant, Pruszków CHP plant, Wola heat plant and Kawęczyn heat plant, and for transmission and distribution of heat via the heating networks in the Pruszków area (supplied from the company’s own heat generating source: Pruszków CHP plant), as well as in the Annopol, Chełmżyńska, Jana Kazimierza, Marsa Park and Marynarska areas, approved by the President of URE on August 13th 2020.
New heat generation rates have applied as of June 1st 2021 under the tariff adjustment and decision of the President of URE obtained on May 10th 2021. On September 10th 2021, the President of URE issued a decision approving the tariff for the company’s heat for the 2021/2022 season covering generation, transmission and distribution. The new rates resulting from the decision have applied since October 1st 2021.
After a new cogeneration unit had been placed in service at the Żerań CHP plant, an application was made to amend the heat tariff so that it covers the CCGT unit in the Żerań CHP plant. The President of URE issued an approving decision on December 17th 2021 and the adjusted heat rates have applied since January 1st 2022. The following tariffs were introduced and applied in 2021:
- tariff effective from September 1st 2020 to September 30th 2021, resulting in a 3.21% increase in average prices;
- tariff adjustment effective from June 1st 2021 to September 30th 2021, resulting in a 9.03% increase in generation prices;
- tariff effective from October 1st 2021 to September 30th 2022, resulting in a 0.12% increase in average prices;
- tariff adjustment effective from January 1st 2022 to September 30th 2022, resulting in a 15.54% increase in generation prices.
PGNiG TERMIKA EP holds licences for: generation of electricity, generation of heat, transmission and distribution of heat, trading in heat, trading in electricity and distribution of electricity.
The following tariffs were applicable to heat generated from PGNiG TERMIKA EP’s generating sources in 2021:
- heat tariff effective from January 1st 2021 to July 31st 2021, approved by the President of URE on June 9th 2020;
- heat tariff effective from August 1st 2021 to November 30th 2021, approved by the President of URE on July 14th 2021;
- heat tariff adjustment effective from December 1st 2021 to December 31st 2021, approved for two generation sources by the President of URE on November 8th 2021.
The approved average heat price growth rate was 8.49% (for heat generation, the rate was 9.92% and for heat transmission: 5.34%).
| Generating unit | Heat [MW] | Electricity [MW] | Cooling [MW] | Compressed air capacity [‘000 cm/h] |
|---|---|---|---|---|
| PGNiG TERMIKA | 5,177 | 1,567 | – | – |
| Siekierki CHP plant | 2,068 | 650 | – | – |
| Żerań CHP plant* | 2,131 | 908 | – | – |
| Pruszków CHP plant | 164 | 9 | – | – |
| Kawęczyn heat plant | 465 | – | – | – |
| Wola heat plant | 349 | – | – | – |
| PGNiG TERMIKA EP | 773 | 185 | 17 | 240 |
| Zofiówka Branch | 279 | 113 | – | 117 |
| Zofiówka Branch (Borynia site) | 4 | 2 | – | – |
| Moszczenica Branch | 121 | 39 | – | – |
| Pniówek Branch | 72 | 14 | 17 | 123 |
| Suszec Branch (Suszec site) | 38 | 11 | – | – |
| Suszec Branch (Częstochowa site) | 3 | 3 | – | – |
| Wodzisław Branch | 55 | 2 | – | – |
| Wodzisław Branch (Niewiadom site) | 3 | 2 | – | – |
| Racibórz Branch (Racibórz site) | 87 | – | – | – |
| Racibórz Branch (Kuźnia Raciborska site) | 4 | – | – | – |
| Żory Branch | 88 | – | – | – |
| Żory Branch (Czerwionka-Leszczyny site) | 15 | – | – | – |
| Distribution Office | 4 | – | – | – |
Summary of auctions on the capacity market for 2021–2026
In 2021, another main auction of the capacity market was held for deliveries in 2026 and an additional auction for quarterly deliveries in 2022. As a result of the three main auctions organised by Polskie Sieci Elektroenergetyczne S.A. in 2018, 2019 and 2020 and the additional auctions in 2020 and 2021, PGNiG TERMIKA and PGNiG TERMIKA EP concluded the following contracts:
- CCGT unit at the Żerań 2 CHP plant: a 17-year supply contract for 2021–2037 (net capacity of 433.3 MW);
- Units No. 7 and No. 8 at the Siekierki CHP plant: annual supply contracts for 2021–2024 (total net capacity of 140 MW);
- Units No. 9 and No. 10 at the Siekierki CHP plant: annual supply contract, limited due to emission requirements, for deliveries from January 1st 2025 to June 30th 2025 (total net capacity of 140 MW);
- Units No. 7 and No. 8 at the Siekierki CHP plant: supply contracts for deliveries in the first and fourth quarters of 2021 and in 2022 (total net capacity of 43 MW).
PGNiG TERMIKA units made available to PGNiG:
- Żerań 1 CHP plant: supply contracts for deliveries in the first and fourth quarters of 2021 and in 2022 (net capacity of 140 MW);
- Units No. 9 and No. 10 at the Siekierki CHP plant: supply contracts for deliveries in the first quarter of 2021 (total net capacity of 171 MW);
- Unit No. 9 at the Siekierki CHP plant: supply contracts for deliveries in the first quarter of 2022 (total net capacity of 86 MW).
At PGNiG TERMIKA EP:
- Moszczenica CHP plant unit: annual supply contracts for deliveries in 2022 (net capacity of 7 MW), and in 2023 (6.4 MW);
- Wodzisław-Częstochowa CHP plant unit: annual supply contracts for deliveries in 2022 and 2023 (net capacity of 1.2 MW);
- Moszczenica-Wodzisław CHP plant unit: annual supply contracts for deliveries in 2024 (net capacity of 8 MW), and in 2025 and 2026 (net capacity of 8.2 MW);
- CFB unit (Cogeneration Fluidised Bed unit) at the Zofiówka CHP plant – quarterly contracts for deliveries in 2022 (net capacity of 65 MW), annual supply contract for deliveries in 2024 (net capacity of 65.1 MW) and semi-annual supply contract for deliveries in 2025 (net capacity of 65.7 MW).
Furthermore, in 2018, the operator of the Stalowa Wola CHP plant (CCGT unit construction project implemented by PGNiG TERMIKA and TAURON Polska Energia S.A.) signed a seven-year supply contract for deliveries in 2021–2027 (net capacity of 386 MW).