Welcome, everybody, very cordially at the conference for the media, investors, and analysts on the earnings of TAURON Capital Group for the nine months of 2022, and the Q3 of this year. Let me first introduce the host of today's meeting. We have President Paweł Szczeszek, the President of the Management Board of TAURON Polska Energia, and Mr. Krzysztof Surma, the Vice President of the Management Board responsible for the finance, the CFO. My name is Łukasz Zimnoch. I'm the press spokesman of TAURON Polska Energia.
Traditionally, the basic information, the presentation will be conducted in Polish with a simultaneous interpreting into English. Outside of the broadcast, you can also listen to today's meeting via the teleconference mode. I'd like to ask you, encourage you to ask questions via the form available on the broadcast website. The only option to ask questions is to use this form. The time has come to make a presentation, and then there will be question and answer session. Mr. President, please have the floor. The floor is yours.
Thank you very much. Ladies and gentlemen, it's a great pleasure for me to welcome during the earnings conference call on the TAURON Group's results for the first nine months of this year and for the Q3 of this year. In my part of the presentation, I will describe the financial situation of the group, the highlights, the events that took place since we last met in September, and the capital expenditures. While the CFO, Mr. Krzysztof Surma, will present the macroeconomic situation and the detailed financial results broken down into the individual lines of business of our group.
Let's move on to the Slide number two, the key data for the three quarters of 2022. Slide number one, excuse me. On this slide, we are presenting the operating and financial results achieved by TAURON Group in the three quarters of 2022. The financial results during this period under review were under the pressure of a situation on the energy and fuels market. The rapid growth of electricity price, gas and coal are reflected in the sales revenue posted. On the other hand, we have an increase of operating expenses, so the earnings were strongly impacted by the outage, the shutdown of a 910 megawatt unit in Nowe Jaworzno, which led to the need to repurchase electricity on the power exchange in order to fulfill the contract that TAURON Group signed.
The net profit that we posted was lower than a year ago. The EBITDA for first three quarters of 2022 went down by 23%, down to PLN 2.8 billion, while the net profit fell by 14%, reaching PLN 395. We, however, increased significantly the capital expenditures. They went up by 33% and achieving PLN 2.6 billion in the reported period.
The volumes posted by the group in terms of electricity production and distribution were relatively flat, while regarding the operating data, a 14% decrease over heat production is not worth it, which was a consequence of warm winter at the beginning of the year and an 8% decline of commercial coal production, which was due to the need to carry out some retooling of the headings at the coal mines owned by TAURON Group. Let's move on to the next slide. On the next slide, we are presenting the data that covers only Q3, the Q1 of this year. Similar as in the data for the first three quarters, you can see an increase of sales revenue and a decrease of the profits. The net debt to EBITDA ratio came in at 3.3 at the end of the Q3 .
It is worth looking at the changes in the operating data in the Q1 of electricity production and distribution and supply. Unnoticeable, the declines, which are, first of all, the result of decreased business activities, business operations that will be elaborated upon by President Surma. A 30% decrease of commercial coal production is a consequence of what I mentioned before, the need to retool the coal phases and the cumulative effects were seen in the Q1 of this year of such activities. Let's move on to the next slide, the summary of the highlights of the most important events of the first three quarters. On this slide, we are presenting the most important events that took place until the date of publishing our earnings for the Q3 , namely today.
Since the majority of them I already described when we were presenting the earnings for the Q1 and for the first six months of this year, let me focus on the most recent events now. Indicated on the slide, the green turn of TAURON is beginning to pick up steam. The Q1 , we completed the construction of two wind farms, Majewo and Piotrków, with total capacity of 36 MW. We also purchased new renewables projects in development with a total capacity of about 70 MW. It's worth mentioning here that at the advanced stage of analysis, we have several further both wind and photovoltaic Projects with a total capacity of around 600 MW .
In accordance with our strategy, by 2025, we want to have 1.6 GW, so 600 MW in renewables, and by the end of 2030 as much as 3,700 MW in renewables. The breakthrough from a point of view of our transition, energy transition, at the same time, a long-awaited event was the signing of a contingent agreement of divesture of our TAURON Dystrybucja subsidiary to the State Treasury. The transaction should be finalized at the end of this year, probably on the 31st of December or January 1st next year. Currently, we are waiting for the fulfillment of the last suspending condition defined in this contingent sale agreement. In parallel, the process of spinning off the coal asset, generation assets, to the National Energy Security Agency.
The spinning off of the majority of the coal assets out of TAURON is the most important strategic project in our company over the last few years. Its completion will unlock the CapEx potential of our group and will clearly, significantly, markedly bring us closer to the achievement of a green turn of objectives. Worth mentioning about the affirming of the Fitch Ratings long-term, TAURON's long-term domestic and foreign currency ratings at BBB with a stable outlook. It's also a pleasure for me to inform you about the best, the best of the best of the high quality of annual reporting in the competition run by the Institute of Accounting and Taxes. Let me now hand over the floor to President Surma, who will continue the presentation. Thank you very much.
Ladies and gentlemen, in terms of the macroeconomic environment, during the year, the conditions have been very diverse, have varied. PMI especially is, which indicate, way ahead of the economic situation in Poland, we have a significant drop, about 40 points. Everything below 50 means a significant economic slowdown or a recession in the near future. The second important indicator for us is the electricity consumption in Poland. Here, for the first time since the pandemic shutdown of our economy, we are dealing with a decline of electricity consumption in the quarter three of this year. In terms of electricity production itself, since Poland still was a net exporter of first three quarters of this year of electricity, we are dealing with an increase of electricity production despite the decrease of the consumption in Q3 .
An important piece of information is the fact that we have a significant increase of renewables production output, mainly as a result of a strong increase of PV panels installed, even among households. Addition, we are dealing with a significant decline of production from gas, which the reason being quite obvious, the Russia's aggression against Ukraine and an increase of gas prices on the market. This, you can clearly see it in the results for the first three quarters. An important piece of information is a transfer of the production between the hard coal and lignite. It's also due to the higher prices of hard coal and the limited supply of this coal on the market, especially in Q3 , in Q3.
Moving on to the results of our group, we are dealing on one hand with a good result, almost 50% increase of sales revenue. The bad information is that this increase was accompanied at the same time by more than 50% increase of the operating expenses, of the cost, which had effectively led to the decline of a net profit year-over-year. The net profit reached after the first three quarters around PLN 400 million.
In terms of EBITDA adjusted by one-off events related to the CO2 emission allowances market, which was one of the transactions back in 2021, 2022, and the effect on the provision for the onerous transactions meant that PLN 3 billion was recurring EBITDA, and it was at the first three quarters, or as compared to the first three quarters of last year, was lower by about 10%. Those weaker results are especially seen in the results of Q3 alone. You can see that in Q3 alone, we reported a loss. At the consolidated level, EBITDA year-over-year was very low. The details and the reasons for this event, I will elaborate upon when I discuss individual segments.
If we move on now to the global results of all the individual segments, the key segment is the backbone of the group is the distribution line of business here, stable positive results year-over-year. A negative impact on the earnings came from the generation segment this year. Also, it's worth, noteworthy to look at the supply segment, which after two weak quarters rebounded. You must remember that this segment includes several areas of operations, and all those areas of operations had a positive contribution to the group's EBITDA in Q3. If we look at the Q3 alone results, here you can see even more clearly the weak results of the generation line of business and the relatively good earnings generated by the supply segment.
I will elaborate on the details when I discuss the individual segments. If we look now at the EBITDA for the first three quarters of 2022 versus EBITDA for first three quarters of 2021, here we can see that clearly that practically all the segments made positive contributions to EBITDA except for the generation segment. This segment was so negative, unfortunately, the positive contributions of the other effects were offset by this negative impact of the generation segment's results. If you look at the Q3 alone results here, we even have a smaller number of segments that made positive contributions to the group's EBITDA. As a matter of fact, we are saying that it was supply and mining segments. In the mining segment, as you mentioned before, we are saying anyhow about the negative EBITDA in Q3.
I will elaborate on the details when I discuss each segment. Let's move on to the distribution segment. Our key subsidiary here, we have stable growth year-over-year. EBITDA higher by about PLN 100 million. Here, an important piece of information is such that the this EBITDA was positively impacted by the higher rate of the fees for electricity distribution. However, the negative impact came from the costs, wages, cost of wages, cost of external services, outsourcing, and the cost of taxes paid on the grid assets. If you look at the Q3 alone in this segment here, the first two effects that I mentioned also had the same impact.
We are dealing here with an increase of revenue and an increase of revenue due to the increase of the rate approved by the President of the Energy Regulatory Office for the year 2020-2022. On the other hand, a negative impact coming from the cost of wages, payroll costs, and the external services costs. In addition, worth noting in this Q1 is a reversal of the cost of covering the balancing difference. In the previous two quarters, we had positive balance of the upward adjustment. Here in Q3, we had a negative. It's a downward adjustment, we had a negative impact on the results of the distribution segment. All in all, it offset the positive impact of the first half of this year in this respect.
Second, if I deserve noting, which also correlated to the decline that I mentioned at the very beginning, the consumption of this in Poland is more than 3% decrease over distributed electricity volume, which had a negative impact upon the results of the distribution segment. If we look at the key parameters, here, practically all of them have been met, have been maintained. Basically, they shouldn't have material negative impact on the future tariff in the distribution segment. Let's move on to the renewable segment. Here, an important impact came from the increase of the prices, both on the electricity market as well as the property rights market. Those price increases had a positive impact upon EBITDA in terms of the volume of electricity generated from renewables. It's almost flat year-over-year.
There's an important allocation between individual segments, a much higher production output from the wind farms. Let us recall that in 2021, the production of wind farms was historically low. This year, we returned, we rebounded into the solid historical average. We had a very low output, production output from the hydropower plants. A low level of waters meant that the production is the same, but the source of its generation has changed. In terms of Q3 alone result in the renewables segment, here we are dealing with this price effect still being positive on the earnings. We are dealing with a significant material decline of the volume, mainly from the output on the hydropower plant. It means that year-over-year, the earnings are very similar.
In addition, we had slightly weaker results on the prices of the pro-property rights, which as a result of the cost, will lead to the comparable results year-over-year. If we move on to the segment that had the biggest negative impact upon the earnings of this year and of this quarter, namely the generation segment, several aspects should be highlighted here. The first one is the high base level effect. Let us remember that last year, we're dealing with a cost-plus contract, which we mentioned several times during the earnings call. That was a contract signed between TAURON and Jaworzno. This contract led to the transfer of a margin between the generation segment and the supply segment as a result, leading to the better earnings in the generation segment.
On an accrual basis, 2021, there's about PLN 700 million for the first three quarters of 2021. We're dealing with a high base level, high reference level. If you compare, have the comparable results year-over-year, you would have to reduce this result, the earnings by PLN 100 million. Nevertheless, even if you adjust for this high base effect, it has materially lower year-over-year. Two issues. The first issue is the effect of high coal prices, which had a significant impact, material impact on the deterioration of the results of quarter 3.
As a result of those high coal prices and the renegotiated contracts by all the mining companies as well as Tauron Wydobycie subsidiary, Tauron Mining, which means a certain transfer of a positive margin to the mining segment, meant that at the same time, we have contracts in place of electricity supply sales on the power exchange at a fixed price, which means that we are incurring losses. We incurred such a loss in Q3, which requires setting up a provision also for Q4. This provision was set up for second half of the year, and it's continued also for Q4. That's one of the reasons for this large, negative, result. The second reason is the shutdown of the unit, which is clearly visible when you look at the results of Q3 alone.
We had an unplanned, unscheduled outage at Nowe Jaworzno in August this year. This failure also coincided with the highest electricity prices this year, reported this year. The company had to repurchase electricity that it sold before at very high prices. Paradoxically, in Q3, when there were very high electricity prices on the exchange in the market, normally the generation segment would take advantage of it, could sell additional electricity, was not so under the long-term contracts, could have sold such electricity on the spot market at high prices. Instead, we were dealing with a shutdown of the unit, the failure of the unit, we had to repurchase. Paradoxically, the generation segment was a victim instead of a beneficiary of high electricity prices on the market in the 1st quarter.
Moving on to the supply segment, as I mentioned, talking about the previous segment, we are dealing with a base effect. Here, this base should be raised. We would have started then from the EBITDA of around PLN 700 million in 2021. Comparing, if we were to adjust it to make it comparable conditions, we had a bit lower EBITDA year-over-year. Its location is also varies. It's different. It's worth noting that we are reporting very good earnings of the Czech Supply, supply energy and TAURON Nowe Technologie also reported good earnings. The supply segment's EBITDA was reduced by the gas contract, high gas prices on the market, and the need to purchase gas.
At the same time, a lack of passing on the entire increase onto the customers led to the significant decline of the margin in this area. During this period, it's almost PLN 100 million in total. Additionally, a negative there was a negative impact on this segment is the profile of the customers, changes of prices during the day, or strong movements of prices during the day, which was not possible to be passed on, onto the final consumers and the G-tariff not covering the full costs. It's worth looking at Q3 alone results. Q3, as I mentioned at the very beginning, after two weak quarters in the beginning of this year, even taking into account the base effect, base level effect that I mentioned, so the transfer of margin between the generation and the supply segments.
Here in Q3, it would have amounted to about PLN 455 million, this effect base. The earnings of Q3 would have been better year-over-year. Here, the key issue was the decline of the price in September and ability to have additional contracts at a bit lower price. If we move on now onto the mining segment, in the mining segment, we are dealing with, unfortunately... Well, if we talk about cumulatively, we are still dealing with positive EBITDA. However, here the key aspect is, of course, the price effect. The price year-over-year went up materially, both on the market as well as of medium-size and large size coal launches, as well, as well as coal dust sales, including also to our generation subsidiary.
We are dealing with a decline of production volume, which I will elaborate upon more when I discuss Q3 alone. It's important that cumulatively this year, this effect of a decline of a sales volume didn't have a direct negative impact on the result due to the fact that in 2021, some of the costs were to activated in the balance sheet were transfers because of the higher sales, and the sales of inventories was activated with a negative result directly in the P&L statement. We didn't have that effect in 2022. We had a positive effect of the base level also in this regard. We move on to the Q3 earnings of the mining segment, here the effect of declining volume had a negative impact.
We didn't have such a large transfer of inventory last year into the results. This effect, as the CEO mentioned at the beginning, was due, first and foremost, due to the retooling of headings in the Sobieski coal mine. We had the peak overhauls of that type, and the coal face retooling. Therefore, the mining output, extraction output from this coal mine year over year was very low. We expect in the next quarter that the extraction output will be at a good historical level. This here, this quarter, due to this retooling of headings and coal faces, we posted a negative result in the mining segment, but we assume that the next quarter will be better. Moving on to the debt levels. The debt, net debt, versus the ratio, including the ratio, it reached about PLN 11 billion.
This is due to the difference in the cash balance difference, almost 1 billion PLN. Additionally, it's reduced by the level of debt and the hybrid debt bonds. What's important, the key issue, the maturity of the loans in December this year, as we mentioned during the previous earnings conference call, on July 15, we signed a loan agreement with the Consortium of Banks, which this loan fully enables us to refinance the loan that is maturing, which was the bonds and was concluded in 2015. We have no risk of refinancing, and what's important also is worth highlighting, also in 2023, we don't have significant maturities of significant loans. The risk of refinancing in the near future is mitigated. Here, I'd like to complete this part of my presentation. Let me hand over back to the CEO.
Thank you very much. Let's move on now to slide related to the capital expenditures. Ladies and gentlemen, as I already mentioned at the beginning of the presentation, in the first 3 quarters of this year, the CapEx went up by one-third versus the same period of last year, coming in at PLN 2.6 billion. Based on the data that you can see in front of you on the graph, you can see that CapEx went up in all lines of business of our group. Traditionally, the largest funds, almost PLN 1.5 billion, was allocated to the distribution segment, with the majority of that amount spent on installing new grid connections as well as grid asset refurbishments and replacements.
The renewable segment is worth noting, PLN 300 million on building 2 3 wind farms and 2 PV with a total capacity of 140 megawatts and the overhaul, upgrading, refurbishing of hydropower plants versus last year, the renewables CapEx went up almost 6 times, which demonstrates that, as I mentioned before, that the green turn of TAURON is picking up steam. More than PLN 270 million was spent in the generation segment, mainly refurbishment and replacements of assets, also investments in the new capacity expansion and growth of the heating districts and connecting to the heat network of new facilities. In the mining segment, the majority of funds were spent on the production preparation and the refurbishment and replacement task.
The balance of the CapEx, mainly related to the IT infrastructure, came in at slightly less than PLN 300 million. Here, I would like to finish our presentation. Let's move on now to the answers to your questions. Ladies and gentlemen, a lot of questions were sent. I will try to read them one by one, unless some of them will be repeating themselves. The first question, what items in what values are included in the other services bar in distribution services in the graph showing the EBITDA for the distribution segment? I will try to answer this question. With respect to this, let's say, bar on our graph, on our presentation, there are three key items included in that area.
The first one is the labor cost, as I'm mentioning also, this is also the order that is reflects the amounts, the value. The key issue is the increase of the cost of labor. The second issue is the increase of external services cost. Those external services, outsourced services, include also services provided by our subsidiaries. What I mean here is the TOK, WDT, and other support subsidiaries that are part of our Group. The third category is the increase of the tax costs. Thank you. Next question, the distribution segment, the bridge EBITDA graph by in values. What is the adjustment balance, the cost of grid losses? What does it include? Why is it so high? The adjustment is related to estimates. What assumptions that were taken account when making this estimate were not exactly in line with the reality, and why?
Why did those misassumptions were so different from the reality? However, the balance of the adjustment, let me start with the results of Q3 alone, came in at around PLN 16 million, and this time, in this quarter, it was a negative balance. If we talk about the very fact how we calculate that, let's remember that this is balance versus balance. It is based on the estimate of customers' invoice during the given period. There's a reference to the price of a distribution service in the given period. it is not so that we make an estimate then we adjust this estimate because it was wrong, but because of the balance in the given period is different from the, say, similar period.
It is worth mentioning here, for instance, the balance changes or recently has changed mainly due to the issue of invoicing the prosumers. Simply, they were invoiced differently. We also changed the systems in between, in the meantime, in terms of billing those and settling accounts with those prosumers. The balance of the adjustment was increased in the previous period, decreased in the current period. One can say that in each period, another period with adjustment balance will be different and for different reasons. It was not due to the wrong estimates, but the difference in the balances in the individual periods. Another question. According to the company, the October 27th law on the freezing of prices and the regulations of the 9th of November will allow for covering all the costs in the trading line of business.
Is the company ready to take over the collapsing independent suppliers? Well, to answer this question, we have to know what will be the level of the tariff agreed upon with the President of Energy Regulatory Office. As of now, we are assuming that all the justified costs, according to the regulations, will be covered, will be included in the tariff. Thus, the results of a segment should be positive, let's say, should generate some minimum margin. Of course, in order to answer this question, we would need to receive information on the tariff. The tariff should be approved by mid-December at the latest, we are waiting for this piece of information.
The next question, what's the opinion about the management board a bit than the distribution segment 2023, what are the factors behind such opinion and according to management board, the volumes and so on, how these factors will be evolving in this segment? In terms of the result for 2022, we can still refer to here. As of now, we are assuming flat earnings in the distribution line of business, which is visible after the first three quarters. The factor that could have a negative impact upon the level of these earnings is the volume of electricity distributed. As I mentioned, Q3 was relatively weak in this regard, and we are dealing with an economic slowdown, so this may have a negative impact upon the earnings. Nevertheless, the full-year result will be flat or slightly positive.
Slightly up year-over-year. In terms of 2023, first of all, the outlook in this regard is presented usually during the presentation of full-year results, earnings conference call. We are waiting, as I mentioned, talking about the trading line of business, waiting for final decisions of the President of Energy Regulatory Office. The model is being finalized for the distribution segment. First of all, WACC, and the level of WACC for the next year is being discussed. The second issue, the level of covering the cost of purchasing electricity for the balancing difference. These two issues are key. To answer the question regarding the prospects for this segment, we have to get the information from the President of Energy Regulatory Office, which I do hope will happen by mid-December at the latest.
When we will be presenting the full year results, we'll be able to provide the outlook for 2023 for the distribution segment. The next question, if theoretically, the generation segment were to be consolidated for the whole 2023, the resu-- a bit of the segment 22 could have been better than the revenue from the capacity market. First of all, let us remember that we are continuously dealing with another National Agency for Energy Security. The basic assumption is the generation segment will be transferred to the National Agency for Energy Security. That's the first piece of important information. The second important piece of information, we are dealing with an legal act and then with an act of law and the regulation that impose certain price caps.
However, the key issue to answer this question is the price of coal for next year. The negotiations are underway regarding this topic with the key mining companies in Poland. To answer that question, what's the outlook for 2023 in the generation segment, conventional generation segment. As a matter of fact, we'll have to know the final price of coal. Another question, PGE expects WACC in the distribution segment to be at the 7.8%. What is the risk that it'll be set at a lower level? As I answered an earlier questions, the application of a company regarding the tariff for next year, including the WACC level, has been submitted by the company. We are awaiting a response of feedback from the President of Energy Regulatory Office.
I don't want to give you a statement, whether this is the level that PGE mentioned or not. I assume that within next month, we'll be able to provide disclosure of this information, and this information will be published. It's a public information. Excuse me. The result of a supply segment in 2023 should be positive or are you considering setting up a provision in the segment in Q4 at what level? At your order of magnitude. Which segment? Supply segment. Let me answer the question again. The result of a supply segment we need to 3D should be positive, or are you considering the provision in this segment in Q4, at what level? As I mentioned, we are dealing with this act of law which regulates over maximum profitability of a supply segment.
Of course, Since we are talking basically about the supply companies, let us remember that the supply segment in our case is both TAURON Nowe Technologie, the Czech supply company, and TAURON Sprzedaż GZE. I understand the author of the question is mainly referring to TAURON Sprzedaż and TAURON Sprzedaż GZE subsidiaries. We are dealing with the act of law. Both the act of law and regulation determine the maximum level of profitability in this segment. We are talking 3%, but the key issue, as I mentioned before, is the issue of tariff approved by the President of the Energy Regulatory Office since the prices for individual consumer, the households have already been agreed upon, whereas the compensation payment for the trading companies will be dependent upon the tariff approved by the President of the Energy Regulatory Office.
Only at that time we'll be able to answer this question, what will be the earnings of the supply segment subsidiary? The next question, how much net debt is assigned, allocated to the assets that are being transferred to the National Agency for Energy Security? Here, it's worth mentioning, which we already emphasized historically, at TAURON Polska Energia, we have a central financing model in place. The entire financing is directly drawn down by TAURON Polska Energia. There is no direct allocation of debt to the individual segments. As a matter of fact, the issue of allocating, assigning the debt is more of a secondary important because we're talking more about the intra-group debt, whereas the key issue in case of a transfer of the assets to the National Agency for Security is their valuation.
A matter of fact, it'll be up to value. Depending upon valuation, the level of debt will be dependent upon the valuation. The parties could agree upon the higher or lower allocation of a debt agreed between the parties. The key aspect is the valuation, how much money we could get, how much for the assets that will be transferred. The next question: Will TAURON be able to post a bit of profit in the conventional generation of electricity in 2023, taking into account the latest decree of the government? In terms of regulation itself, the regulation specifies the maximum profitability of this segment.
To every megawatt hour, maximum margin of first-degree profit to cover the CapEx and the cost of financing at the re-level of around 50 PLN, additionally 3% calculating based on the price on the spot of balancing market in the subsequent year. It's not possible to describe it directly, but the key issues, the price of coal, hard coal, could be passed on, could be transferred, and the price of CO2.
The key to the answer whether the segment or what the result of a segment will be, would be the volume of electricity sold by this segment and of course, obtaining such price of coal, which will allow us to generate a positive CDS, positive margin in this segment, which will allow, at the end of the day, to achieve the profitability indicated in the act of law. Today, it's not possible, as I mentioned before, to determine the earnings, the results of the segment, having not finalized the negotiations with the coal mines. The next question. Supposedly, the trade union members from Tauron Wydobycie, Tauron Mining subsidiary, want 10,000 PLN for each employee for getting transferred from Tauron directly to the State Treasury company.
Are there talks underway with management board of TAURON or the management of the National Agency for Energy Security in connection with its planned sale of Tauron Mining subsidiary to the State Treasury? We're talking both to the workforce of Tauron Wydobycie subsidiary, as well as management board of Tauron Wydobycie. The workforce ask questions, like, about the future of this entity of this company, while it becomes the State Treasury company, the workforce put forward certain expectations, both of financial and non-financial nature. The talks are underway. We want to complete this transaction by way of coming to an understanding agreement with the workforce. Next question is related again to the finances in 2023. Should we expect a significant increase over financial costs?
Of course, as I mentioned, we are giving this outlook during the presentation of the full year results, but it's not a big surprise here if I say that the increase of the costs will take place. It is mainly the consequence of a base. Increase cost, the increase of the WIBOR rate. Let us remember that last year, WIBOR was around 3%. Today, we are dealing with, we're talking, in our case, the main factor being the 6-month WIBOR. Today, the 6-month WIBOR is around 7.5%. Taking into account the fact that some financial costs are delayed, are lag behind. The WIBOR is set 6 months ahead of its actual implementation. Partly in 2022, we're taking advantage of a lower cost of financing as a base effect, considered a base effect.
Similarly, next year, we'll have to pay some interest according to the higher cost of financing due to the increase of the WIBOR rate. The loan margins are at a similar level year-over-year. Here, of course, it's worth noting the level of financing that we have according to the fixed rate, and the cost of financing here will not change. An important piece of information is such that for some transactions, especially for the loan that matured in December this year, we had a transaction based on the fixed interest rate, the IRS transactions. Those transactions will expire.
They were concluded at a lower interest rate level. Thus, with respect to some part, certain part of the financing cost will go up since the fixed from fixed rate based on the IRS instrument will move on to the floating rate and based on the current WIBOR level quoted. The next question, has TAURON secured hedge the price of coal for its power plants, combined heat and power plant, after the mining is transferred to the State Treasury? We have contracts in place, active, which irrespective whether TAURON Mining subsidiary is part of TAURON Group or outside, those contracts are in place, are active, and will also be in place and working next year, both for our power plants and combined heat and power plants. Time has come for the last questions.
How due to the transfer of assets to the National Agency for Energy will be the bonds and the loans at TAURON? As I mentioned, the issue of loans and bonds is doesn't change. The party for the financing agreements in the majority cases is TAURON Polska Energia. TAURON Polska Energia will be as it happened before, so far up to now, will be servicing this financing. The key issue when, during the transfer of the assets to NABE is the question of the price that we managed to obtain during this transfer for those assets. We can imagine then on a transitional basis, taking into account our strategy and the growth and the transition towards the green energy and fixed, CapEx in the distribution.
The cost of CapEx will be high in the long term, but on a transitory basis, we can imagine that especially those loans that, well, the RCF, that we can fluently pay them back and then draw more funds. Partly, those loans could be paid back from the funds that we get from NABE. On a transitionary basis, that could reduce the debt level of the group. The key issue would be the price that we obtain for those assets and the how this payment will be spread over time. Ladies and gentlemen, this way we have answered all the questions that we have received. Already today, I'd like to invite you to our next meeting directly after we publish the report for the full year 2022. After, we will inform you about the date of this conference in a traditional way.
Thank you very much for this meeting and see you next time.
Thank you. Goodbye.