Good morning. We are commencing the conference on financial results of Tauron Group for three quarters of 2024, and here are Grzegorz Lot, President of the Board of Tauron, and Krzysztof Surma, Vice President for Finance, Piotr Gołębiewski, Vice President for Trading, and Michał Orłowski, Vice President for Asset Management and Development. Program of the conference is traditionally, as in case of transmission online, first the Board will comment on the results, then there will be a Q&A session, and always, as always during conference online, questions may be asked through the forum on the transmission webpage. I'm Urszula Podraza and I am in charge of the press office. President Grzegorz Lot, good morning.
Great thanks for the recent questions and feedback after the conference. You asked us to be more cohesive time-wise, so as to narrow certain information, to abbreviate communications. We actually adapt to this formula. Today's presentation will be a new version. We are open, of course, for further feedback, and we will keep improving. We also added a few elements which you asked about, among others, the presentation of economic debt. We strongly work on the question of additional estimation. Since January, it will be in the new formula. These are our obligations to analysts and shareholders.
We actually stick to this. Some information, most important, like in every power group, it is client. A lot of work on client recently, a lot of work on digitalization and getting ready for the new market. Dynamic tariff well proven. I want to boast and praise our colleagues from sales. 70,000 signed contracts today with nine-year price guarantee, 100% of renewable energy. This is for 2024.
We will be successfully developing over the coming time, and information that for sure you noticed that after the flood, soon after the flood, we entered with the offer to people affected by the disaster, and we prepared a special product that means offer for those who suffered in flood. 80,000 households until now have been benefiting from this offer. This is lowest price, lowest we could offer, highly limited and only dedicated for those people. Ladies and gentlemen, a very significant thing which we communicated is on the 17th of December, there will be presentation of new strategy. You are most welcome already today. We are inviting you, and, well, to part of the questions you asked today, these answers will be obtained on the 17th, just after presentation of the strategy, and please be also invited to talk to us.
We will be available for you as long as needed. In the meantime, we are preparing quite a lot of these elements, operational elements, so strategy, operational strategy. On the go, we keep discussing it with the supervisory board. Until now, a strategy has been adopted regarding renewables and ESG and regarding heat. These are just exemplary elements. They all, all these operational strategies which cover individual business units, actually fit into this strategy, which will be presented on the 17th of December. Among very good information we communicated already earlier, we obtained additional financing for PLN 4 billion . We applied to KPO for specific amounts. Today we are not able to say what are these amounts. But with a lot of determination, we keep waiting for what will come out of it, what amount we get. We also have good information about confirmation of rating.
We still kept our rating BBB-. And it is good information, BBB-. And ladies and gentlemen, this current development, it's not only climate, but also our infrastructure. As we talked a lot recently, the matter of renewables. We have an application filed for a connection for Rożnów, the pumping storage power plant you keep asking about. And we have Mierzyn and Warblewo, two objects, altogether 90 in the wind. And this year we will hand over Kamień, Proszówek , 90 mega. And seven projects are in progress of implementation. They will be not completed within this year, but there are specific deadlines. And it is almost 500 mega in wind in consecutive time elements, timepieces. And based on information we passed on to you earlier, we acquired a large project to almost 200 MW, Miejska Górka.
At the moment, it is already in the process of operation and implementation of the project. All these projects are necessary to provide our clients with electrical energy, the green one or low emission energy, but first of all, energy in good price, so this is the future. We are building on our offer for our clients. This very briefly, to avoid wasting more time, I'm handing over to Krzysztof, and he will tell you about finance now.
Good morning. Dear ladies and gentlemen, I will also try to be maximum brief and present financial information in new graphic display, well, let's see if you like this presentation better than the former one. For sure, we will do our best to make shorter quarterly presentations and maybe longer yearly and half-yearly, so regarding revenue, for three quarters of this year, they dropped about slightly less than 30%.
But this comes from normalization of prices in the market, drop of those prices, and smaller volume of selling energy recently. Regarding EBITDA, it is also a little bit lower year-on-year. In the following slides, I will be presenting it more in detail. And especially, I will show you a comparable EBITDA. But it is worth mentioning that market consensus has been significantly actually beaten over PLN 150 million for these three quarters regarding financial consolidated results. At the beginning, we had a loss of about PLN 200 million. But if we cleared off one-off events and provisions on conventional, which also comes from smaller expected flows from conventional, the result would be positive and it would reach close to PLN 1.5 billion year-on-year, 26%. Here it's worth boasting that close to 90% of those expenditures were allocated for distribution and renewable energy sources.
Broader on this topic, you will hear from Michał Orłowski in further part of the presentation. The indicator is at stable level, around 2.4. It is a safe level from the perspective of financing agreements. Moving on to operational data, we have increase in distributed electrical energy for these three quarters. Gently, it is growth in line with increase of consumption of energy in our country. At the same time, there is positive information regarding renewable energy sources. Here we also have increase in production. First of all, there's increase in production results from handed over new renewable installations in wind and photovoltaics over the recent year. Additionally, we have positive data regarding wind strength, so amount of wind. It results from the amount of wind. Similar was in our biomass units and water hydro power plants.
Regarding conventional generation, here another year in dropping volume, and actually here more about this. You can hear from Piotr Gołębiewski. Let me hand over the floor to him in this respect for a moment.
Good morning, ladies and gentlemen. Generation of electrical energy from conventional power plants, that means those fueled with hard coal and gas, was over 6.7 TWh over the nine-month period, and this was 13% lower production compared to last year. Regarding all renewable systems, taking into account in this number low emission biomass systems, generation of electrical energy altogether was 1.2 TWh , and this is increased by 3% compared to last year. Here my predecessors mentioned that for this growth, apart from perfect provision of wind, the process of gradually handing over new units in renewables, that means Mierzyn, Warblewo, wind farms.
There will be Gamów and photovoltaic farms in Proszówek, which are all in progress of startup. Our energy mix shapes the following way. 85% electrical energy was generated from conventional power plants and 15% from low emission sources and renewable sources. We hope that this percentage will be changing very stably and dynamically to the benefit of renewable energy sources. Let me take back over discussion on financial results regarding questions of heat generation. Here we have a drop. This drop results from higher temperature in the heating season, which we had at the beginning of this year. I hope that in the following years it will be slightly different. We have to take into account that climate warming will result in reduced demand for heat.
Regarding selling electrical energy, here first of all, this significant drop year-on-year resulted from losing large client in A segment and slightly lower consumption in other segments. And additionally, increasing auto consumption of prosumers, which also results in lower demand for energy directly from our sales company. Now moving on to EBITDA, comparable EBITDA, which I started discussing. So this comparable EBITDA year-on-year difference in it is lower than the difference in reported EBITDA. It reaches less than just below 10%. And regarding main factors which actually corrected the reported EBITDA in individual periods, it is first of all, we should be discussing the adding to balance difference. We discussed it in the half year and in result presentations. This year we had a large positive influence of this factor and big negative influence of this additional estimation in the current year.
I will say upfront that we are working on a new model, as President mentioned, what we promised you at the annual conference in March this year or in the turn of March and April this year, so now we are planning in this quarter to work out and practically to complete the model, the one which we had on the go related to adjusting energy and clean up the results so that results of distribution segment are comparable, more comparable year-on-year, and thus it is one of the elements which we also heard as expectations or suggestions from analytical side. We are working on it, and we count upon the fact that in annual conference we will be able to boast about success in this respect and effectively eliminate this factor.
Thus reported EBITDA and comparable EBITDA will not be adjusted by additional corrections of balance difference. Regarding other factors which influenced, they especially influenced 2023. They also influenced the comparable balance year-on-year. Here one has to point at this famous PLN 125 . It was the resolution which obliged power companies to reduce clients' obligations by PLN 125 . Positive interpretation was related to it received this year, which positively influenced the result of this year. It allows us to deduct VAT from this PLN 125 . Regarding other factors which last year influenced reported EBITDA and corrected it to comparable EBITDA was the question of provision for the price difference fund. This year we do not have this provision. It was a very significant item, over PLN 400 million .
The second factor which one-off influenced results last year, it was agreement signed with Rafako, which was related to building 910 MW unit in Jaworzno. It positively influenced EBITDA one-off last year. Moving on to EBITDA broken down into segments here. Traditionally, let me tell you that our key segment is the distribution area. We keep highlighting it. In these three quarters, close to 60% EBITDA came from this segment. Here I would at the same time ask your attention at sales segment. It was very good after these three quarters. Whereas here, a little bit ahead, I would dare say that two factors will be influencing this segment in the fourth quarter. First of all, we are dealing with reduced tariff in the second half year. This will especially be visible in the last quarter this year, this influence.
Additionally, due to difference in profile and cost of purchasing energy, it doesn't distribute equally, evenly over the year. As revenue comes evenly, the cost of buying energy is not evenly distributed. This segment after three quarters looks best compared to other segments. The fourth quarter will be weaker in results of sales segment. Another thing I would like to ask your attention, it is renewables segment. Here I mentioned, well, many-fold, about six-fold lower installed capacity compared to generation segment. Well, reduced capacity, wind and photovoltaics have lower efficiency, generated significantly higher EBITDA than generation segment. This shows the segment present in the market and pushing out conventional sources by renewable sources. Results in these segments in the future will be in spite of big difference in installed capacity. They should actually have great variety.
So renewables should be growing and generation results should be dropping. Regarding EBITDA, as I mentioned with net profit, if we clean up one-off events regarding provisions in conventional sources and drop in assets put off resulting from it, tax put off, then EBITDA in all segments is positive. And now moving on more in detail to individual segments. So let me start from the key segment. That means distribution area. And one may have the impression of negative result, very significant drop year-on-year, close to PLN 800 million. However, let's keep in mind that the main influence on the drop came from close to PLN 1.1 billion. I mean, negative influence was adjustment of balance difference. These are one-off events. We plan to eliminate them.
If we eliminated this factor, then due to increase of WACC and the increase in volume, result of distribution year-on-year would be positive. Regarding renewables segment, here it is relatively simple because we have positive influence due to price effect year-on-year. it is not so that prices in the market increased. No, no, they dropped in the market. But let's remember that last year price was frozen on renewables assets. That freezing resulted in year-on-year better revenue on renewables segment. Additionally, greater volume and returned wind allowed us to generate more power from renewables. Negative influence on this segment was the result of green certificates. In the market, there was a significant drop in these prices. Additionally, some of our systems come close to the 15-year period of use.
That means that system of support in the green certificates is excluded, switched off. And regarding generation segment, as we mentioned, significant drop in the volume, significant drop in prices, and thus significant drop in CDS has resulted that in this segment we have significant drop in margin. And this is one of the main elements of drops in this segment. Other element is mentioned by me by the aid of comparable EBITDA. It is a one-off effect of agreement signed last year regarding construction of unit in Jaworzno. And this effectively resulted in this segment year-on-year worsening the results significantly. And this not only means that these are one-off events like in distribution regarding heat segment, it is practically the same level year-on-year. Two effects influenced it.
One positive tariff effect, tariffs were maintained at good level, whereas prices of coal and CO2 dropped, whereas at the same time negative effect, that means like in generation, margins dropped for electrical energy. And that influenced negatively the results of this segment. Regarding segment sales, here practically this result year-on-year was mainly directed or generated by one-off events. Last year we were dealing with a significant reserve provision regarding PLN 125. As I mentioned earlier, this year we had negative influence of the tariff, whereas additionally up to this PLN 125 we had positive influence of the interpretation. I mentioned all these factors when talking of comparable EBITDA. And now we are moving on to slide where a significant novelty appeared, which you also requested and president mentioned it upfront. So first time we presented economic debt.
Economic debt reached at the end of the third quarter a level of PLN 19 billion, whereas this net debt, which we are reporting to financial institutions, which we used so far mostly, was about PLN 12.5 billion. What differentiates these two debts, these two items of debt? First of all, it is taking the position provision for rights for CO2 emissions. So we have already generated energy, whereas the rights to emission and payment for these rights will be done only in the following year. So this is the first key element differentiating this. Other elements had been signaled in the past, but I will go through them. Now it's a question of including taking financial leasing. In our financial agreements, we display leasing as it was before, introducing IFRS 16. In this respect, after introducing IFRS 16 within leasing, all long-term agreements appeared.
In our case, it is first of all the permanent use of ground, renting, and leasing of land plots. Looking at our segments, both in wind farms and in distribution and in heat segments, we have permanent use of land and long-term rental. All this is in leasing item. These items are not as our agreements are not classified into net debt. Another element differentiating these two items are subjected obligations to PLN 2 billion. They are not included in net. Of course, in case of something impossible to happen in our case, but in case of any insolvency, this debt is number two demanded after senior debt. Last element here, we differentiate those items more. This is state of cash at the level of slightly above PLN 500 million. Regarding the situation of liquidity and economic situation of the group, it is good.
We have available financing for the end of the third quarter. We had it at the level of about PLN 4 billion. As President mentioned, we obtained over the recent three months close to PLN 4 billion. PLN 3 billion were reported. Other PLN 850 million, which had not been reported, it is medium-term financing at the amount of PLN 350 million. This means that altogether the group today has availability of quite liquidity cushion. And we applied such strategy for many years such obtaining financing ahead for the foreseeable financial gap. And as President mentioned here as well, we pointed that the company filed application within KPO to obtain low percentage rated financing for distribution networks. So that much from me. And let me hand over to Michał, who will tell you about the investment part.
Honorable ladies and gentlemen, total spending for total input by Tauron for three quarters came up to PLN 6 billion. The largest segment of distribution, its participation in total spending reflects the group. Largest item is connecting new connections in distribution. The second largest is modernization of the grid assets. But we keep continuing replacement of meters to smart meters within AMIplus program. Now about 25% of our clients have such meters. We are finalizing also implementation of dispatchers connection TETRA for our distribution as well. The second largest item is renewable energy sources. In the next slide, I will discuss in more detail advancement of individual projects. This year, allocation between wind farms and photovoltaic farms is about 80% to 20%. So clear majority of our investment projects have been done this year in wind farms. We can see significant reduction in conventional generation.
We tend to optimize refurbishment spending to keeping conventional generation in work of existing units, which is reflected in spending on the segment this year. In heat, about PLN 70 million was spent, 2% of our spending. Here we are continuing refurbishment spending on existing units. We are finalizing 140 MW capacity gas boiler. We are in Katowice, and we are connecting new recipients to our network. And recently over PLN 100 million invested in IT and preparation to CSIRE and modernization of lighting. Moving on to the next slide, we actually handed over for exploitation two wind farms. On the 8th of August, Mierzyn was handed over close to 60 MW capacity. And on the 30th of September, Warblewo wind farm was handed over both in budget, within budget, and before deadline resulting from the time schedule. Well advanced is Gamów wind farm.
Last work is in progress. And we expect in the first half of December to have this unit handed over for exploitation. Construction work is completed. Taking over is almost at the completion site. In Nowa Brzeźnica, it is about 50% advancement. We completed main installation of seven out of nine turbines. And we finished the main takeoff point from this farm. So work is going according to schedule. Regarding Sieradz wind farm, here we are at the stage where we completed grouting the foundations. We are in the process of organization of the backup facilities of the site. And we will be moving to next phases. And now Miejska Górka President Lot mentioned, it's in the initial phase. The project was acquired quite recently. So we are at the starting phase of construction process. Regarding photovoltaic farms, Proszówek photovoltaic farm, here we are in the final stage.
Last configuration work within SCADA to control the farm is now going on, and we expect the farm to be handed over for exploitation in December as well. In Bałków wind farm, we are in Bałków PV. Actually, half have been delivered, and advancement is slightly lower on Postomino PV. We ended delivery of all modules. We are in the process of delivering inverters, and we are also within schedule. Moving on to the next slide, we also wanted to show you distribution, geographic distribution of our investment. Our traditional activities, our wind farms and conventional power plants and distributional networks are located in the south of Poland, whereas the investment is distributed all over Poland where there are optimum conditions for construction, with most density in West Pomeranian district, where wind conditions and availability of land being highly condensed in a small number of owners is better.
Thus, it is easier to develop such wind farms. That much from me.
Thank you for your attention. Well, good. Ladies and gentlemen, so I'm looking at the watch. We are point sharp in time. So we have a lot of time for questions. And this was the main objective of our self-correction. Well, from general information, I wanted to pass on to you that within the flood activities, we had inspection from Polish Waters on our dams. And as you can see in the slide, we got information that our operations and what we were doing was 100% in line with requirements and procedures which are enforced. So for me, it is a very important thing. And it confirms all what we communicated to you so far, clarifying, explaining the situation in the Lower Silesia. Now moving on to questions.
The first questions are here, quite a lot of them. Of course, I do encourage you to ask further ones. The first question, to what extent is the scenario of switching off over 50% of coal-fueled from 4.1 to 1.8 in Tauron until 2028? Well, this is a topic, if you allow. Of course, we are open for suggestions. There are three questions from the series because it is so that we are talking of units. Well, three questions from the series. Good. And I will do my best to possibly broadly respond to that. If I was not precise enough, please ask additional questions. And of course, we will give you broader information. The first thing is that apart from this 910 units, so the new Jaworzno, we have in our group 12 units, 200+. Two of them have market capacity until 2028.
Other units actually have market ending, Power Market ending in 2025, so at the moment, very intense work is going on, and in a few perspectives, one is legislative perspective in order for the Power Market to appear and so that it works for the following three years. We are strongly involved in the work, in consultancies and opinion giving, and the first draft of the law appeared, then another one is in the pipeline, and the work is, or result of the work is so optimistic that we believe that the Power Market will keep operating. All the more that messages on the side of PSE clearly say that this power is needed, and we approach our assets, our product-wise, so we say, on the one hand, we have a product.
That means electrical energy generated from our renewable sources in the whole ecosystem together with storage facilities and so on, but it is energy typical from renewables, which is the future. Another perspective is conventional energy. That means produced mainly in 910. There is quite a lot of electrical energy and, well, followed by consumption of coal, and the third product of our group, it is the power. That means capacity security. That's why we have 200 for the transition period to provide services and provide the market with the power. This is our value offer which we present to the market, which we are selling, and this is our approach to this process, so on the one hand side, we have these units. We know that the market of power ends in 2025.
If market of power would not be available or it would not be attractive for us economically, we then clearly say that they will be switched off. This is the message we send to the environment. And this message has already been transferred to the public side. We are also, after a series of meetings with our employees and social party and local governments, we inform what may happen. And we prepare the organization both from business situation and social-wise to this situation. Although our main goal, and this is the thing we are focusing on, it is sales of our product in the market, which needs this power. Today, we know that in messages from PSE in perspective of 2028, each unit, every power is necessary for stabilization of the operation of the system.
So we believe that in this Q1 or in the first half of the year, auctions will be announced. And we will approach this auction or, well, we will do our best, of course, depending on the conditions. And if we win the power auction, we will continue the work. And this scenario will keep repeating over the coming three years until 2028. We have three years for together here with PSE, with legislation to think up what the backup for power in the system should look like after 2028. But for the time being, we are focusing on these three years. This is also an answer to the question, what is the probability? So probability is there. But at the moment, we are estimating that it is low that the 200s will be switched off because the message from PSE is very clear that this power is needed.
Whether all the units will enter the power market will be covered by it, we don't know because this will result from the auction, competitive operations, so we will see which units will be reported and which units will actually go through this competitive element. It's important that if Power Market does not exist, this is an answer for the next question. We don't see a chance to keep units in production which do not generate positive economic results, so the precondition is operation of these units from the perspective of us, of the Board, to obtain positive economic results, and this is our clear commitment, and we are getting ready for various scenarios. Priority is to maintain, to keep those units because years of preparing this part, the social part for transformation are involved.
We are also working on option two, which we will tell you more about on the 17th of December, about commercialization of those places which theoretically will appear after switching off the 200 units. I keep repeating that power market is ahead of us. We see a big opportunity to fit in the market and to be selling our service. There is also a question in this series. Please forgive that I'm talking so long. I want to be very precise because not only shareholders are listening to it, but also our employees. For them, it is also very important a message. Whether is the prioritization who is more important, shareholders and practically owners of our company or the social agent? We are considering all these elements.
We take very serious approach to this social part or to our employees and to the local governments, and here we carry out a very open and highly determined dialogue with these groups, communicating to them what may happen. They are getting ready for all scenario, preparing also the development version after theoretical closing down the units. Let me give you only the example that we are after conversation with every employee of our power plant. It will be the situation in everyone in turn where we personally communicate what that person can have, what options after closing down. Will it be well energy, time off, or earlier retirement, then we gain information who wants to have earlier retirement, who wants to be relocated, well, the lucky thing is that apart from the conventional energy, which is today subject to great changes as a company, we plan big investments.
So, distribution, renewables, heat. Therefore, we need professionals. We need people who are involved. Therefore, we have the option to offer to our employees work within the group. And as we declared, it is our goal to not only generate value, but also to take care of people and also companies who are cooperating with us now. So we actually balance these elements. We take care of people. We take care of local governments. We are very well advanced in these discussions. But economy is the holy grail for us and for the units to be operating after 2028 and after 2025 also. They have to fulfill economic requirements. And we take great care of it. I hope I did answer the questions, but it was long. But these were three questions. Yes. And if you have additional questions asking for more detail, please write. We will actually answer.
If not me, then my colleagues. Okay. Now, next question. To what extent scenario of dividend policy in December is possible and paying dividend in 2028? Well, honorable ladies and gentlemen, as we announced, the presentation of strategy will take place in December. We would not like to go ahead of facts today. The only thing we can promise that in that strategy, definitely the question of dividend policy will be included and paying the dividend in the following year. So as of today, this is my answer. Let's wait till the 17th of December. So I suggest you to keep the floor still. The key issues in generation on coal is a bit less possible in conventional generation next year. Well, here we may say that this answer is slightly complex because, of course, significant question for conventional power generation is question of CDSs themselves.
It is obvious this is one of the elements in revenue. Do not let us forget about the second element. The second element is power market. The third element, which appeared this year, is a question of additional revenue from balancing market. Of course, pressure on CDS is visible all the time. We can see it. It looks very bad, especially for 200 units. Let's keep in mind that here our role is optimization in the area of hedging of this and then buying back in this market, possibly revenue in power market, as I said, plus balancing market. We hope that total value of all that will result in the fact that conventional power generation will still be at the positive EBITDA level.
Next questions, please explain economic sense of purchasing ready finished PV and wind farms offshore and at which moment value is generated. Do you want to generate a few percent of IRR selling price product higher than production cost? But I will merge it with a question which we got regarding Miejska Górka project and prices of energy. As you quite right mentioned, one of the elements which purchasing wind farms gives us is achieving synergy by allocation of synergy to end users. As President mentioned at the beginning of our presentation, we have, among others, offer with nine-year permanent price for end users and recipients, which is also our element of way to allocate to end users. And this is among the most important factors. I wanted to add that Miejska Górka farm was not purchased as finished ready farm. It had complete set of licenses.
The process of construction will be carried out and supervised internally by us. Apart from this element, synergies related to balancing the portfolio, so wind farms are a good addition to hourly profile of what is demanded by our end users who more and more often have their own photovoltaics and they need energy when the sun is shining less. Therefore, wind farms fit in this profile well, and on top of that, there is synergy at more operational level. We ourselves manage wind farms, which we have so large purchasing scale in contracts for maintenance of such farms. So we have certain synergies at cost side, and here, responding to the question about the Miejska Górka project, alone detailed assumptions regarding prices of energy are not revealed at our conferences.
What I can tell you is that this project was implemented on market terms with internal return higher than WACC, cost of capital, and in renewable segment, additional, we can see synergy with our sales of energy being upside to result on this transaction. The level of input per megawatt is also lower compared to those which to the average from implementation of recent farms in the group. This, which was noted, includes provision, cost provision currencies, so it is a level of spending including all elements and additionally including buffers for risk. Another question from investment about CAPEX for energy storage construction and what percentage can be replaced by free subsidies from the EU. Well, regarding this CAPEX and energy storage, it is more complex in wind farms. We have actually two, three suppliers from which we select, and the price differences practically do not exist.
But this price of energy is more complex. We have suppliers who are much cheaper, but they guarantee higher parameters and lower parameters. For example, Chinese suppliers and the question where from the inverter is, and well, the spending dropped recently quite quickly, so I think they are at the level of 60%-70% or maybe lower than they were considered one and a half years ago. Key factor being megawatt hours, not megawatts. It is, I guess, level which should be about PLN 1 million per megawatt hour or lower, depending on supplier of technology, but everything depends on configuration, and we have an example of PGE who showed higher prices. We on our side were in preparation for auction of power market, which will take place in the fourth quarter in December for energy storage facilities.
After these auctions, we will see what the system will look like or level of support from this source will look like. We will also be during contracting, we will see what prices will be achieved finally, depending on configuration. Regarding the subsidy program that was launched, the level of EUR 1 billion, which is organized by National Fund for Environmental Protection and Water Management. Their expected maximum subsidy level is 40%-45%, as we see. So depending on results of that competition and finally allocated levels of subsidy, this will be the level. But it should not exceed the figures I have mentioned. Thank you very much. Now, another question. To what extent the average cost of financing debt may drop in the group? We obtain lower financing in the context of money from the EU.
I will not precisely answer this question for one reason, because we didn't have the amount of application for what level of subsidy we apply from KPO for reconstruction of our networks. And we don't know what amount will be finally allocated to our application. But what we can say that definitely would significantly influence in the future the cost of financing due to its level. Its level is 0.5%. It is not increased by any base rate like WIBOR. So in order to answer this question, we should know the final amount of this funding and how quickly we will be utilizing it. And then what will be the level of subsidy from other sources. But taking the percentage rate level, it is significantly lower compared to the market. So this will significantly reduce the average weighted rate in the group. Thank you.
Is the company planning optimization of labor costs, for example, in the form of program of voluntary redundancies? We are not planning it. We take good care of costs. The amount of work, which is ahead of the group and amount of investment activities is so big that our employees are very needed. Of course, we are saying if switching off the coal-fired units would be switched off, there is a staff problem we have to solve. More in categories of proposing employees, be it, as I said earlier, retirement or energy vacation or proposal of working in other locations in the group, within the group. The program of voluntary redundancies are not planned. Now a question making more precise the question of shutting of coal-fired units. How will the process look like? Do we have a plan for individual units?
And how will it influence the possibility of financing? Well, of course, customer, client is our Lord. We, of course, have a plan for every unit. So we are studying when analyzing economics, analyzing solutions. The first perspective is the site, this place where the units are located. The second perspective is each and every unit. So this for sure will be done in this way. And the question of phasing out or taking off the power units or operation of 200 units, it has nothing to do with phasing out of the assets. Independent of whether they will or will not be, there is a gap in the system and financial gap. And in a way, we will have to utilize those capacities to support transformation of power sector until 2028 and maybe even later. So we separate these two things.
As we mentioned earlier, we declared that as Tauron Group, we are supportive of phasing out of coal-fired units and assets. We said that if they are not phased out, separated, we will manage in a different way somehow, but we will. Krzysztof is intensely working on various scenarios. We are also prepared for various hybrid solutions resulting from this. We will show you more about this on the 17th of December. As you know, this process, decision-making process regarding separating or phasing out of coal-fired units is decision of shareholders and the main owner, the State Treasury. Depending on the model which will be worked out and decisions which will be made, we as a company, we will be following these decisions. Looking at the fact that there are possible various scenarios, we have to be prepared for acting in various environments.
There will be a separated hived-off asset. We will for sure follow the path of very quick big investment. In other case, we will be doing our transformation and development, maybe project finance or other solutions. But definitely, we will be implementing it because our clients expect low cost and green energy. And the fact that we are so intensely working and struggling for the power market, we are filing the offer of selling capacity from our 200 units. It means we are doing it in the model when these units are within the group. But also the solution will be working, is necessary also for the model with separating coal-fueled units.
Thank you. And at Piotr Gołębiewski, other power groups signaled that they expect lower prices of coal in contracts for the next year. Is Tauron also expecting drop there and how big drop? Yes, really, we expect drop in coal prices. Let me recall statistics from this year regarding this PSCMI 1 index. That means the index based on energy coal in deliveries to professional and industrial power sectors, so over the nine months of last year, it dropped by 2%.
The same is happening in European market. Coal ARA dropped by 20% from PLN 22 per gigajoule to about PLN 18.7. This is also caused by questions regarding the dropping demand for coal in German power sector. Increase of production from renewables is pushing out the coal from conventional power plants, and this actually results in a drop. We buying coal, domestic coal, because these are the expectations today. We have built a model in which we would like this contracted coal to be adequately contracted to produce and sold electrical energy.
Therefore, we would like to take care of the purchasing of the coal to be profitable and so that CDSs, which were mentioned here already, to be positive. We foresee coal prices due, among others, to large surplus in Polish deposits will be still going down in the coming year. Thank you. These are all questions which came today. Thank you very much for today and see you during transmission on publication of strategy on the 17th of December. See you and please be kindly invited on the 17th of December. We will be available for you. We will be here. There will also be streaming available after presentation of the strategy. All the board will be available for you as long as needed, so we will answer all the questions, of course, those which we may answer and which we know answer to.
Nevertheless, very kindly, please be invited and we are awaiting these events. Thank you.