28. Future capital expenditure commitments

As at 31 December 2023, the PGE Capital Group had undertaken to incur expenditure for property, plant and equipment in the amount of approximately PLN 17,762 million. These amounts will be allocated mainly for the construction of offshore wind farms, new power generation units, modernisation of assets of the Group’s entities and purchase of machinery and equipment.

The most important future capital expenditure concerns the following projects:

• Renewable Power Generation – construction of the Baltica 2 wind farm in the Baltic Sea (including an agreement for the supply and installation of offshore wind turbines, a service and warranty agreement, an agreement for the design, manufacture and commissioning of offshore substations, an agreement for the supply of foundations, internal cables for the turbines) – an amount of approximately PLN 7,249 million; modernisation of the upper reservoir of the Porąbka-Żar pumped storage power plant – an amount of approximately PLN 886 million; design and construction of new photovoltaic installations in more than 40 different locations – an amount of approximately PLN 391 million; environmental studies together with an environmental impact report and acquisition of a decision on environmental conditions for the project covering the construction of the Baltica 1 wind farm in the Baltic Sea together with offshore and onshore connection infrastructure – an amount of approximately PLN 290 million.
• Other Activities – construction of a CCGT power generation unit (Rybnik 2050 sp. z o.o.) – an amount of approximately PLN 2,983 million; construction of two CCGT power generation units and a service contract for two gas turbines (PGE Gryfino 2050 sp. z o.o.) – an amount of approximately PLN 1,622 million.
• Distribution – investment commitments related mainly to network distribution assets in the amount of approximately PLN 2,530 million.
• Heat Generation – construction of a CCGT power plant called Czechnica-2 in Siechnice – an amount of approximately PLN 287 million; construction of a gas-fuelled cogeneration source based on gas engines and a reserve and peak heat generation source in Bydgoszcz – an amount of approximately PLN 262 million; construction of Line II of the Thermal Processing Plant with Energy Recovery in Rzeszów – an amount of approximately PLN 194 million.