Good morning, ladies and gentlemen. Welcome to our conference, where we present the result of TAURON Financial Group for the first half of the year. A warm welcome to everyone joining us live here in person and online. My name is Olga Kostrzewska-Cichoń, and I am Head of Media Relations of TAURON Group, and I am going to be the interlocutor of this meeting. Let us welcome Grzegorz Lot, President of the Management Board of TAURON Polska Energia, Krzysztof Surma, Vice President of the Management Board for Finance, Michał Orłowski, Vice President of the Management Board of Asset Management and Development, and Paweł Jabłoński, Executive Director of Portfolio Management. We have also presented a speech by Krzysztof Zawadzki, Vice President of the Management Board for Trade. Our meeting is going to be divided into two parts.
First, we are going to present our results. Then, of course, you are welcome to ask any questions in the second part, so this will be Q&A session. Mr. Lot, the floor is yours.
Ladies and gentlemen, I will be brief. First half year has been very dynamic. You might notice it already by looking at us, and we are proud of what we have been doing because we have made a commitment when we announced our strategy. Our hashtag is, "We deliver," and this is crucial. This is visible in our company. We have been delivering. We will get into details afterwards. Distribution has been carrying out its projects, and we have been converting quite a lot of processes right now, and we have a focus on local content in it. So the AMI readers procurement, so we are choosing the contractor by the price, but also based on the local contact. Is it easy? Well, it is doable. It is challenging, but doable, so we have been implementing these elements in a systemic way.
We are extremely proud of one thing in distribution, and this is apart from our everyday work, it is the customers, the clients. In our strategy, we want to grow, the distribution in a dynamic way, CapEx and projects, but the customers matter. 75% of our connection requests have been done online, and this is something that makes us stand out. This is what we offer to customers, and it is a great value, I think. I could talk quite a lot about customers, but let us leave it for Q&A. One very important thing for us is, the renewables. 1 GW of connected capacity. Miejska Górka has been speeding up. It was planned for autumn, but in June already it was executed, and new units will be launched soon. This affects our results, but also shows that we are very determined to make it operational.
There is one very important and sensitive thing for us. This is energy warehouses. We know that the first one to come to this market will be the winner. We can see one important challenge here. This is the cost. The price of electricity will be going down, but the cost of the profile is something to handle. Energy storage is crucial here. It is important for the stabilization of the grid. Now, heat. Marcin Staniszewski is with us here, so he is at your disposal. We won the cogeneration auction over PLN 3 billion for projects that are underway and tenders that are in the pipeline for the new Łagisza. It is going to be electricity and heat combined block, a very modern one with a reasonable price. It is already underway, and it is also in line with the strategy. Our customers, clients, again, I am very enthusiastic about it.
A few years ago, we made the bid, and it is three years into this already. TAURON Nowa Energia, a nine-year price guarantee. We are now reaching 400,000 customers, 385,000 customers contracted energy for nine years. So if someone asks for the price for households, well, it is unpredictable totally. But in our company, it is clear for our customers. Almost 400,000 customers. Heat pumps, et cetera, are perfect solutions for larger consumers. Someone might ask, and if the price falls down? Well, every consumer in Poland can leave the contract, the fixed-term contract without penalties and choose any other product. We are convinced here. We are not afraid. We do not want to corner our customers. To the contrary, we want to compete on security and quality. 400,000. Dynamic tariffs are also an important, interesting thing. nine-fold growth.
The total amount is still small compared to the total base of the customers, but this is the future for us. The interest has been growing. We have launched a new product. This is the dynamic tariff with a price cap, because we can see that customers have their concerns. The price of electricity might go down, PLN 495 , and for some it is even PLN 300. So we have a cap. We communicate that you can save a lot of money if you change your habits, and this will be a gain for you. Also, one very important thing for us, over 40,000 new customers, a huge growth with the Tanie Godziny [Cheap Hours] . It is an upgrade of the dynamic tariff. If you do not want to be directly involved, we provide a solution of very specific prices in very specific hours of the day, of the year.
Customers, it is very clear for them when they can make savings, and the Tanie Godziny [Cheap Hours] , and this has attracted many new customers. Over 51% of TAURON customers are already outside of the tariffs and in the products. This is hard work to work together with the customers to convince them to join this transition. For us, it is money. For customers, it is security and price stability. It is very important for what we want to do, which is switching from the classical model to the model based on dynamic tariffs, renewables, and energy storage, customer engagement. We want to lower the cost of the profile, and you can only achieve it through shared engagement. This is what guarantees lower prices. Also, digitization is our continued project. Over 50% here. It is small font here, so you can see it better in the chart.
This is the number of customers who already are serviced online, invoices, contact point. Some people are very willing to do it, and we've had a strong focus on developing the digital channel, the internet, and smartphones. Last but not least, profitable transition and just transition. Two years ago, when we talked about it, we talked about what it would be like. Now, we know that we won the capacity action for the previous year, and it was a very good decision. It was very profitable for us, and also very good for the system stabilization. Now, a huge capacity auction, which also was won for all the units, apart from the backup ones. I am not going to get into details now. It's huge money and work for the next year.
This is also a message to local communities that the units will be operational in the next year. We have embarked on huge transition projects. I would like to invite you to Katowice on the 1st of October, the Energy Days Roundtable. We will show you not the dreams, we'll show you the specific plans for the transition of the sites which are now conventional. So Siersza, Jaworzno, Łagisza. I'm not going to mention all of them. So there is a specific plan for every site, for OCGT and conventional solutions. I don't want to spoil it, but everything is planned and measured, and it will be announced there. This shows our approach to transition. That's why two, three years ago, we undertook to guarantee business continuity because we want the business to continue to be profitable so that our shareholders remain an interest in the project.
This is how we deliver on it. I'm very proud for our team. This is largely an achievement by my colleagues, so an applause. The tender has been announced. It was difficult to buy the gas turbines. A lot of publicity, but it's a closed topic now. We have contracted two turbines instead of one. 2x 315 MW OCGT in Jaworzno. It's an ongoing project that will be delivered as planned. So much from me, and later on, I will be at your disposal during the Q&A [Non-English content] Now we are going to see the Krzysztof Zawadzki speech addressed to us.
Good morning, ladies and gentlemen. Let me begin with the energy market and the key factors shaping current market conditions. We continue to see why there are intraday price ranges in both the spot and balancing markets. To give you an example, the highest hourly day-ahead price recorded since the 1st of January this year was PLN 2,560 MWh, while the lowest was -1,309 PLN MWh. The widest price spread within a single day during the first half of this year was PLN 2,409 MWh. These figures illustrate a shift in the way the market operates. Short-term fluctuations in renewable generations are playing an increasingly important role. They also create price risk, which means we need to actively manage our portfolio hedges and trading position.
We can also observe the further growth in PV capacity. According to Polskie Sieci Elektroenergetyczne [PSE], it reached 27.6 GW at the end of the first half, up from 23.7 GW, an increase of around 16%. The scale of these new connections is increasingly the influence of solar generation on electricity prices, particularly in the afternoon. This widens the gap between daytime and evening prices and makes balancing the national power system more challenging. We are also observing a decline in the number of hours with negative prices, 237 hours last year compared with 253 in the first half of this year. We expect the full year total to be between 250 hours- 300 hours. The numbers of hours with negative prices fell by 19% year-on-year, but negative prices remain an important feature of the electricity market.
A problem of periodic generation surpluses have not disappeared, although they were less pronounced than in the first half of 2025. We are also observing higher clean dark spreads. Coal costs have fallen and electricity prices have risen, while the cost of CO2 emissions allowances has increased. This means that hard coal-fired generation was more competitive relative to gas-fired generation in the first half of this year. Higher electricity output, compared with the half of last year, supports this assessment. Overall, the economics of coal-fired generation improved significantly year-on-year. Average temperatures during the heating seasons were lower, this translated into higher heat sales and better utilizations of our heating cogeneration assets. Conditions for wind generation, however, were considerably less favorable. In fact, wind conditions were the worst in 10 years. Capacity factor fell from 24.2% year-on-year, and generation was down 14.6%.
This adversely affected the result of the RES segment and reduced the share of low -emission generation in the national electricity mix. Hydropower generation increased slightly from 31.2 GWh- 31.9 GWh. However, July and August demonstrated how difficult hydrological conditions in Poland have become. Taking those months into account, we expect full year generation to be broadly in line with last year. The full year outlook, therefore, remains modest. As I mentioned, weak output in July and August, caused by difficult hydrological conditions, limits the scope for generation growth into the second half. Overall, renewable generation fell by 0.9% in absolute terms. This reflects a significant improvement in renewable output in the second quarter, following a quite clear decline of 1.1% in the first quarter. However, when we take the increase in installed capacity into account, output per megawatt of capacity was down by around 10%.
It means the benefits of additional capacity were therefore largely offset by less favorable generation conditions, particularly for wind. Electricity generations from fossil fuels increased by 7.4%, driven by higher output from gas and hard coal. This helped compensate for weaker renewable generation and meet growing domestic electricity demand. Hard coal-fired generation increased by around 10%, making up for lower renewable output. This confirms that conventional generation continues to play a key role in balancing the national power system when renewable availability is lower. Domestic electricity consumption increased by 4.6% year-on-year. Over the same period, GDP growth averaged around 3.65%. At the same time, PMI and the detector of economic condition was down by around 1.4 points. Manufacturing PMI remained below 50 throughout the first half, averaging around 48.1 in the first half of 2026. Manufacturing is therefore not keeping pace with the broader economy.
Another important development concerns cross-border electricity flows. At about 1 TWh year-on-year, reaching nearly 2 TWh for the first half as a whole. Exports exceeded imports in every month except February. This balance reflects price differences between Poland and neighboring markets, particularly Germany. It also reflects renewable generation across the region, the availability of domestic generating units, and the cost of fuels and CO2 commission allowances. The conclusion is that these cross-border flows reflect the growing competitiveness of domestic generation and high-capacity utilization. The scale of dispatching in Poland is also increasing. Compensation paid by the operator to renewable generators does not cover all the revenue that we lost by the affected installation. It is calculated using balancing market prices rather than the prices under the commercial contract.
In the first half of this year, redispatching reached almost 1.2 TWh, which is an increase of 42% year-on-year. This is a substantial increase. It reflects the growing challenges of integrating renewables into the national power system. Contributing factors may include local grid constraints, inefficient management of surplus generation, and transmission limitations. For electricity trading, the main implication is a greater risk of differences between plant and actual generation. An interesting example is that the amount of the electricity would be enough to cover the yearly consumption. To put the development into perspective, it would be enough to cover a full year of electricity consumption by Polskie Koleje Państwowe, for example, PKP, or six months of electricity consumption by all residents of Górnośląsko-Zagłębiowska Metropolia. Let me turn to our generation portfolio. Our electricity generation increased by 24% year-on-year.
Conventional units were the main driver, with output up 87 of our total net generation. Renewable generation increased only slightly by 0.3% year-on-year. However, we should remember that on June 30 last year, we installed renewable capacity, and it stood at 874 GW and reached 1,210 GW by the end of the second half of this year, which is an increase of 39%. Output per unit of installed capacity, however, fell by around 27%. The first half shows a widening gap between growth in renewable capacity and the actual growth in generation. This underlines the need to expand grid infrastructure and, above all, to build energy storage facilities that would allow us to store surplus electricity when generation is higher and make use of it later. At the same time, improved competitiveness allowed us to increase output from conventional units by 28%.
This again demonstrates the importance of TAURON Group's diversified generation portfolio. Heat generation increased by 8%, supported by lower temperatures during this year's heating season, as I mentioned earlier. CO2 emissions rose by around 24% as a result of higher conventional generation. We also recorded an increase of around 7% in the average cost per unit of CO2 emitted. Together, 24% increase in emissions and 7% increase in average emissions cost mean that those costs have a greater impact on the generation segment's result. Coal consumption also increased by 25%, reflecting higher output from our coal-fired plants. At the same time, the average unit cost of coal consumed fell year-on-year. It was this reduction that helped improve the competitiveness of our coal assets. Renewables accounted for 13% of net generation, down 3.1 percentage points compared with the first half of last year.
As in the wider market, unfavorable weather conditions reduced output from our renewable assets relative to their installed capacity, and this limited renewable generation despite the increase in capacity. Renewable generation curtailment increased by 31% to almost 62 GWh . The ratio of curtailed generation to net generation also increased from 3.9% in the first half of last year to 7.1% in the first half of this year. The volume of redispatching affecting our renewable units rose particularly sharply to more than 5x its previous level. This is also reflected in the compensation due to us. Estimated compensation receivable for dispatching the first half of this year have already reached 80% of the estimated total for the whole 2025, and that gives a clear indication of the scale of this issue.
Turning to the availability of our generating units, our hydropower plants maintain a high availability with only a slight decline year-on-year. Our wind farms improve their availability and continue to maintain a high level of technical availability. Our solar plants recorded a slight decline, but availability remained high. Coal-fired plants, particularly those at TAURON Ciepło, increased their availability compared with last year, demonstrating a high level of operational readiness. For coal-fired power plants, however, availability fell by 15.1 percentage points compared with last year. This mainly reflected outages caused by equipment failures or plant shutdowns. Almost every unit experienced an outage of this kind during the first half. Average generating unit availability across the national power system remains higher than in our own portfolio. Let me now turn to our sales portfolio.
Electricity sales volumes increased strongly by 8.2% year-on-year, with the largest increases in the household segment at almost 9% and the business segment at more than 16%. In the household segment, the number of metering points increased by more than 52,000. In the business and SME segments, growth was driven mainly by higher sales volumes. The growth rate of TAURON Group's electricity sales was almost twice the rate of growth in domestic electricity consumption, which is, as I mentioned, 4.6%. This supports our position as a leading electricity supplier, and reflects, in my view, the strength of our offering for both household and business customers. Turning to the renewable share of our electricity sales, we recorded a slight decline of 1.6. Purchases of renewable electricity, the numerator in this calculation, grew more slowly than the sales volumes.
To reach a share of 100%, we would need to document the renewable origin of all the electricity purchased for sale. The decline, therefore, reflected slower growth in renewable electricity purchases than in overall sales. As a result, the renewable share of the electricity we sold was noticeably lower. We also recorded substantial growth in customers under the Nowa Energia program. The number of metering points increased by almost 170,000 compared with the first half of last year. Of these, 80% were household, 327,000, and then small and medium-sized enterprises accounted for 50%, and large businesses for around 1%. This growth confirms increasing demand for electricity backed by green certificates, and more broadly, for renewable electricity. The household segment is the main driver, accounting for 80% of the total increase in the customer base.
The pattern of growth shows that the Nowa Energia program is currently being driven primarily by household customers and the SME segment. There is also further growth potential in the business segment. Turning to electricity fed into the grid by prosumers, we recorded a slight decline of 1.3%. In the first quarter, the volume fell by around 25% year-on-year, and this was due to higher consumption, probably because of the colder winter. In the second quarter, electricity fed into the grid increased by 7.3%, and this growth came mainly from prosumers using net billing, primarily those with new installations. I will not repeat the earlier points on heat sales, so that increased, supported by higher demand and lower average temperatures. Our Tanie Godziny tariff continues to attract customers. At the end of last year, it had 25,000 customers.
By the end of the first half of this year, the number had exceeded 40,000, an increase of almost 62%. This suggests growing interest in an offering that helps customers use electricity more efficiently. We can say that this interest is really, really growing, and we need to prepare those offers and use electricity more efficiently. It also demonstrates the effectiveness of our sales and promotional activities to tell them that they can use their portfolio. We are helping, this way, customers to understand that they can actively manage when they use electricity and better align with their consumption needs. Let me close with a few words about our efforts to raise customers' awareness of electricity use. We are currently running an educational campaign called Tauron: That's Obvious Choice. It encourages customers to save electricity and make informed use of time-of-use tariffs.
It also promotes our online energy advisor, the Tanie Godziny and Tanie Weekendy offers, and of course, dynamic prices. The most visible effects of our campaign is this traffic on our website. Among the main results, we have seen also an increase of around 11% in interest in these tariffs on our website compared with the corresponding period. Interest in our online advisor service has also increased. We do hope that these incentives will encourage customers to choose tariffs and better match their consumption patterns, and of course, help them reduce their electricity bills. That concludes my presentation. Thank you so much.
Just a comment. Mr. Zawadzki is with us emotionally, although he is absent today. He has talked quite a lot about coal, but I want to pass a clear message. The long-term strategy of TAURON has a clear focus on renewables, storage, customers, supported by OCGT, and other things I've talked about. Now we are simply using a market opportunity. These units are essential to stabilize the system and have a very specific tangible value. So operational discussion is one thing, and then there is the strategic point of view, and I don't have to repeat myself. Now, Vice President for Finance, Mr. Surma.
Good morning, ladies and gentlemen. The results of H1 2026 are a bit lower than in 2025, but let's remember that there is the underlying effect. 2025 was the record year, the best ever in the group, hence the differences year to year.
They are negative, but still we think that the results for this H1 are sound. Now, revenue, it is over PLN 17 billion , comparable year-to-year. Two factors, juxtaposed factors, so the price of energy fell, and the volume and distribution had a significant increase, the energy sold, heat.
Krzysztof has already talked about it, I am not going to repeat it, but these were the two juxtaposed factors. EBITDA. I will later get into detail, but the level is PLN 3.7 billion , and that is 12% worse year-to-year. Let us have a look at comparable EBITDA, 2026, we think. There were no one-offs that would have affected the comparable EBITDA, and in 2025, we did have some one-offs, mainly the tariff question, which I already discussed. In 2024, to remind you, the regulator adopted a tariff for 18 months, which was extraordinary. It was not favorable in 2024.
It did not cover the costs fully because the price of energy went up. In 2025, in three quarters, this was turned, this lower tariff was turned, so it is not comparable. That is why we have an additional effect of around PLN 200 million on EBITDA. Therefore, if we take this away and compare EBITDA year-to-year, the difference is around 8%. Now, net revenue, it is over PLN 1.5 billion . Yes, it is also lower year-to-year, and mainly due to the drop in EBITDA. The additional things that affect this figure is the deferred tax, which is higher, and the current tax is lower. The net income is better because of the interestment costs and the derivative instruments. This comes partially from the securities accounting, which were implemented last year in October.
Now, investment outlays, CapEx has gone up a bit, and nominally, distribution has had the largest effect, but Michał will talk in detail about it later on. Now, net debt to EBITDA. A very good level, 1.2. This affected mostly by the decrease in debt. Let us split it into segments. No changes here. Distribution remains the most important segment, 64% of share in EBITDA. In H1, EBITDA nears PLN 2.4 billion. So its position is stable, and then followed by other segments. Number two this year is generation because of the favorable conditions for conventional generation, EBITDA, PLN 464 million, H1. Now, there has been a change. Sales is not ranked second anymore, but third now. I will tell you why later on. EBITDA here is PLN 272 million, and the next new segment is renewables, PLN 445 million, and heat, which has been catching up, and nearing renewables, PLN 235 million in H1.
Now, the specific reasons behind the weaker EBITDA year-to-year. As you can see, most of the segments have lower results, but the reasons are mostly out of company's control. So, distribution first, the balance of the regulatory account, the position of it is crucial. This is the difference between the actual volume and the volume set in the tariff, and it will be cleared in the year N+ 2. Last year, the account was positive, and this year, actually, it is negative, over 170 million PLN for the whole year of clearing the volume of 2024. Because of that, already in H1, the result year-to-year was negative, PLN -222 million on this account. This is actually what largely determines the results of distribution. There were two more factors, which are also very important.
The regulator assets grew in value, PLN 2 billion difference, and this improved the result, but also WACC went down by 1.34 points. This has had an adverse effect. Both factors offset each other, plus there was a negative effect on the balancing difference. Overall, the effect on distribution was negative, but also there is good news that is important for our strategy. As you know, we believe that the electricity consumption will grow in the country, and this year, for the first time, we can see it in the distribution, 3% growth in the volume of electricity distributed. Now renewables. On the one hand, the market prices have fallen, as Krzysztof has mentioned, and this has had a bad effect on our results this year. Good news, while we have launched new units, this brings up volume and, consequently, EBITDA.
Some negative events, wind conditions have been worse year to year. We have launched new units, which unfortunately has been offset by less winds, and this has had a worse effect on the whole segment. Now, heat. This is the only one that actually grows year -to -year. Two factors here. First, volume growth. Lower temperatures during the heat season, and this is the first factor. The second one is the increase in the tariff, and it has been a positive effect in this segment. Also there has been a higher margin on electricity. The costs fell, the generation costs. As a result, year-on-year, the results have been better. This is the segment that is positive and stands out because of that in H1. Last year in H2, there were enough write-downs, regulators issues, free allowances, CO2 allowances.
All of these will be reversed in the next quarter. Now, supply and wholesale trading. I think that it is the worst performing segment. A few factors at play here. The first one is, the G tariff in 2025 performed exceptionally well. On the other hand, the costs of G tariff went down and neared the line of profitability. Therefore, it is not possible to get a positive margin in this segment. Also, the lower unit margin on supply to business operators and SMEs. Now, good news, the structure of supply has been evolving. Customers prefer increasingly listed products and not a fixed price, and this lowers the risk for the company. 65% of our business customers already prefer the listed price of stock exchange, so this mitigates the risk.
Good news, while the growth of volume, for the first time in a longer period, supply has gone up, and for many years there had been drops. It is an increase. It is a positive development. Now, the last segment with a small loss year-on- year. It is generation, but we consider that the results are good anyway. There is a fall in price year -on -year. Because of that, EBITDA is slightly lower. But the volume is better, both of sales and production. The balancing capacity revenue has gone up. Year -on -year, last year we had some compensations, which has not been the case this year, but the segment looks good, really, despite the slight drop in the first half of the year.
Now we can talk about the debt, our ratio that we have seen before. The one reporting to the bank, the difference is about PLN 2 billion year -on -year. I would like to show you also the economic net debt, and this net debt is on a very similar level to previous year. Why? The main issue here is the way, when the date of CO2 strike down, write down, when it was redeemed. Now we can redeem the certificates for CO2 emission a little bit later. In 2025, some of the transactions, there were forward transactions which were adjusted to the previous redeeming period, and right now we adjusted them to our liquidation, to our cash flow, and we delayed this date. We adjust forward a transaction to CO2 redemption.
About PLN 2 billion of write downs, which means those PLN 2 billion, we are going to spend a little bit later for the certificates. Those certificates were bought at the turn of August and September, and this is the main difference year-on-year, why we have this net debt a little bit different. Another factor which is also quite vital for future financing costs, it is on our NRP. In 2026, we included PLN 1.5 billion of preferential funding in the inter arrears. The four of the preferential funds and the grants are now included in our reporting, but it of course influences the debt. Now when you look at debt, you can see that we have exchanged the most expensive debt in our balance, which we had the most expensive debt in previous year, and now we exchanged it.
Both debts right now, both financing ways, decrease our debt. I would like to also pay attention to our leasing. There, we can see an increase, but our leasing is not a typical financing leasing. Mostly, these are mortgages and lease. A lease for property, a lease for the land, and they are going to increase the value of our debt on lease. The last information in this slide, you can see that our group is in very good financial position. We have PLN 6.42 billion secured, and I believe this is enough of a 12-year gap to finance it. We have also PLN 14.2 billion available financing under the NRP project, and it is going to be started, commissioned after the execution of the contract. First we need to commission the investment, and then we will be financed by those funds.
Now let us talk a little bit more about NRP financing. We are not going to stop. We deliver our strategy. We obtained more than PLN 400 billion from those project, mostly on renewables and the lightning, on the distribution, and the charges for electric vehicles. As you can see, on July 30, we had PLN 18.4 billion funds of preferential financing. We are just a step ahead from this strategy to reach it. Remember, it is just two years since we announced this strategy. We have a lot of grants and provincial loans that we apply here, and we are still searching the cheapest possible financing. In my part, that is probably all. Now I would like Michał to talk about the investment part.
Krzysztof talked about losses, and there are fewer of them, but still, the results I believe are really great.
There is a lot of optimism. You need to remember that besides those negative information, the results are really optimistic and we all received dividends, and we always fight for those results, but they are, let's say, pretty interesting. Ladies and gentlemen, now we are going to talk about CapEx. They increased year-on-year by 6%. PLN 2.8 billion is the average CapEx. Now we are going to talk about distribution. We invested PLN 1.7 billion. We are going to talk about the structure that you can see in here in the slide and the CapEx investment, but it does not really reflect our perspective, because the last quarters were very intensive and years of intensive securing preferential funding, grants for RES, cogeneration auctions, but then, of course, I am going to refer to them.
When we talk about the investments, we are in the procurement process, and we want to start also some construction sites, therefore, maybe this CapEx scale is pretty low. Of course, later I am going to talk about them in more detail in particular slides. If you look at the distribution only, construction of new grid connections is PLN 811 million, and renewables. Construction, it is about 7.8 GW in our capacity, and also we sped it up with modernization. In practice, it is about 1.5 km of the grid, of the network, modernized, of course, right now. We create a great scale program of distribution, which is supposed to increase these ratios and indicators. When we are talking about these intellect smart meters, it is about more than 3 million smart meters at our end users.
When we talk about wind farms, construction of three wind farms was the biggest challenge and the biggest investment for us, as well as modernization of hydroelectric power plant in Piechowice. If we talk about heat, the main source where we spend our money was heat sector decarbonization project, and also connection of new facilities to the district heating networks. In other segment, this is about PLN 74 million in lightning and light fiber. It, of course, was also financed by the National Recovery Plan. Talking about generation, we do not have CapEx from Jaworzno, but we are expecting them to come in the next quarters at a large scale. Nowe Jaworzno, it is now 910 MW, and it is also, of course, undergoing a modernization process.
There are a lot of systems that are going to be replaced because, historically, they caused a lot of problems. I believe that in the next quarters, those problems are going to be solved and the dispatching will be higher.
Now moving on to the wind farm in Miejska Górka, the first electricity was manufactured already. This is still a startup phase, but we are testing the turbines and commissioning them one by one, and we are now in the process of final operational approvals for the power line. Importantly, the project is already generating energy, and it is going to be visible soon. It was around PLN 8 million of income in August, and once more turbines have been launched after the test, the production will grow, and next year, we expect in the Q2 the project to be fully operational. Importantly, we received dedicated financing from the European Investment Bank for this project, which is quite favorable compared to commercial terms, and we have 18 years to repay this loan. This is a project that enjoys very attractive financing terms. Now, the outlays and spending.
This is an interesting thing here. The expenditure was PLN 705 million in June. This is the expenditure, the spending over PLN 1 billion. This is because the turbines were prepaid, and the outlays do not reflect fully the progress of the project. Also, between 2026, 2027, we will recognize the costs as outlays of expenditure, which will increase this item in the balance sheet significantly. Now, going to the storage. In the first H1, we were preparing the tenders. Now we are choosing the right contractors in total for the energy storage and renewables. 492 MW are covered by the tenders, and this will help us start the execution, the physical construction of the projects. Other projects are under construction and are to be handed over this year. Kuźnia Raciborska, we are the final stage of fitting and construction, so soon they will join our pool of storage batteries.
Now, PV and wind projects. We have already mentioned Miejska Górka, but there are also other projects we launched, which are PVs or hybrid facilities. Let me focus on two examples here, because I think that they are a good example of our philosophy in this segment. As we know, PV is under significant pressure. We have discussed the prices of energy on the market, the prices under pressure, and our projects, in practice, are projects with value added. So take Mysłowice, 55 MW, huge scale. It was a former landfill, so it was very difficult to repurpose the land for other uses. It was also a burden from the point of view of real estate tax. So we got financing from the National Recovery Plan, 90% in loans, - 20% points as the underlying rate.
This has solved the problem, and also it is a potential for the future because the farm is located next to Jaworzno. There is a possibility to directly hook up new assets, including an electrolyzer. So on the one half we have preferential loan. We have repurposed a post-industrial site, which was ours, and which has been now incorporated into the fleet. The hybrid facility in Ogrodzieniec is also an interesting project. It is our own development, developed internally. This is a strategic promise we made in our strategy. We will build a PV facility here, 65 MW of capacity, and storage, 55 MW. PV also enjoys funding from the National Recovery Plan, and the batteries got a grant from the National Fund for Environmental Protection and Water Management. So this is also an interesting solution. Our own resources have been used with double preferential financing.
I think this shows very well what our philosophy is of creating the best value for our shareholders with the best possible and available support. Now, moving on to the OCGT unit. Many questions, many doubts were involved whether we would be able to contract these turbines to meet the capacity contract we made, and we have succeeded. We are very happy with the conditions of this contract. Why we succeeded? First of all, technological flexibility. We have a one turbine solution, Class H turbine here, but also there is a two turbine solution to Class F turbines, and this two turbine solution turned out to be more feasible in this specific setting. Also the model of investor deliveries.
We split the turbines from the construction contracting, and this made more companies interested in the supplies, and it will help us also to boost the number of companies interested in the construction contract. One EUR 293 million , and out of that, EUR 193 million goes for the turbine supply. The installed capacity will be higher than planned because now with the two turbines, it is going to be 630 MW of electrical capacity . If you compare that to the situation in the Polish market, it is around 30%, 25% cheaper than some recent contracts made on the market. Our contract is 25% cheaper, so this is an interesting contract. The turbine can be built outdoor with containers, so this means that prefabricated modules can be brought to the site, which will shorten the construction process and reduce the spending on the construction works.
Now we need to get the approvals, this is crucial, and the environmental decision and the construction permit. We also need to prepare the specs. We need to hire the contractor or the engineer for the site, and the tender is ongoing. We want to finalize the design in the beginning of the next year. The construction part and the turbine part will be split, and this means that there will be more companies interested, which will boost competitiveness and also local content for construction parts. Now, the carbonization of heat. The CHP unit in Łagisza is the key project for us. PLN 1.2 billion . This is the largest budget, plus over PLN 2 billion of funds from the cogeneration auction, which will be paid between 2031 and 2045. This is our crucial asset.
It is in the middle of Silesia and provides energy to most of our heat system over there, and it stabilizes heat deliveries for most parts of Silesia. Now, the tender for turbine supplies is underway. Two turbines are planned, and we expect to get the bids in September and choose the contractor based on that. Jaworzno Heat Utilizing is an important project for us as well. First, it is important because it will provide heat to the city of Jaworzno, but also it will provide energy to the steam unit in Jaworzno, and once it is commissioned, we will be able to put out of service some coal units in the power plant Jaworzno 2, which now generate loss. It will have a significant result on our results.
The CHP auction was won in June, and we will launch this in 2029, but the gas boilers will be launched earlier. In Będzin, in Jaworzno, we will use storage and electrode boilers 30 MW in Łagisza with the electrode boiler. The idea is that outside of the peak heat season, we want to use negative prices for hot water for households. We do have huge projects, but also we have won many CHP auctions, Olkusz, Zawiercie, Kamienna Góra. These are smaller locations, not as meaningful. But this means additional revenue and profitability and also profitable decarbonization of smaller sites. Thank you.
Ladies and gentlemen, now I would like to welcome you to Q&A sessions. The first question here comes.
Thank you so much. I have three questions, actually. First refers to slide number four, when you are talking about the generation portfolio, you inform us that year-on-year, the consumption of coal rose about 35%. Of course, it is very difficult to foresee what is going to happen in Q3 and Q4. However, it is a fact that since August, we are facing a little bit different reality, especially capacity reality than we were in June, of course, for clear reasons. Therefore, I would like to ask, if the consumption of coal is going to rise in Q3 and Q4, bearing in mind the geopolitical situation. Day before yesterday, at the coal mine congress, it was said that almost there was nothing, no coal in the warehouses, in the storage sites.
Are you going to buy some extra additional coal supplies? If yes, where from if the warehouses, storage sites are empty? Second question, it is a very interesting information that in your renewables portfolio, there are batteries, energy storage batteries. Do you have any previous experience? Do you think it can be a game-changer based on the second quarter? Of course, I would like to ask about three sites, Łagisza, Jaworzno, and Siersza, in the context of the capacity market. Do you believe that what is happening, I mean, every year, some kind of black scenario is going to happen, starting from COVID. Is there any chance that the three sites are going to operate in your portfolio after 2028? Thank you so much.
I would like to answer the first question. If it goes about coal in our group and coal supplies in our group, we can see that it is increasing and it is a consequent of our strategy. We try to secure the supplies, but we also are open to some new solutions. You can see that what we can see in the first quarter is a consequence of procurement processes and offers on the market. Of course, we bore in mind the availability of coal. What can happen in the second half of the year? The dynamic is pretty high. It is dependent on geopolitical situation, on the weather conditions, and of course, availability of our units. What we have already said, Nowe Jaworzno is in an outage right now. In October, there will be an outage in Łagisza.
So the demand for coal is going to be a little bit different in the second half of the year. And of course, we are talking about hedging contracts. Yes, coal supplies are secured. Now, I would like to refer to this battery storages, to the warehouses. I believe it is just the beginning of a very fast way that we are going to accomplish soon. The results are better than we assumed. So actually, what I would like to say is that our portfolio is secured of 600 MW in our warehouses, both on the capacity market and also with grants from the National Fund for Environmental Protection and Water Management. We have received the most of all capacities, financed by state. So we were the second company financed by environmental fund. What do we expect, actually?
Or maybe the question is, if we think that it will support our financial result in the second half of the year? Yes, I believe it will. So the warehouses should eliminate this value. It can be, of course, spent on the margin or on lowering the costs on improving our competitiveness and increasing the volume. Yes. And as Michał said, it is 700 of-
MW? Mega? It is another warehouse. So yeah, we can see a great potential. Without such warehouses on such a scale, also dispersed ones, this transition will be very difficult, and it will be very difficult to deliver the price which is now present in the European Union. So that is the question. And now the third question, pretty difficult one. So we are getting back a little bit to the history that happened three years ago. And now the question refers also to 2028. So it is a kind of capacity market in 2028 and 2025. In 2025, we won. It was a good decision. With this unit, we could provide a stable system. So regardless of this transition that we are undergoing right now, I think we are able to face it.
So we also won a contract for 2027 in the capacity auction, and I think we need to win the auction for 2028. And then we will be able to discuss this year. So there are a lot of projects undergoing, but the reality will verify everything. Pragmatism is crucial. Our position here is that as long as we do not commission these gas units, renewable units, we need to have backup because we need to provide our customers with energy 24/7. There is an option, and it is right now under discussion. So we are ready. We have a strategy that we are presenting right now, zero emission, opening the world of new energy, and I believe that we can compete with these units. We have a precise, specific offer. We can work longer, even in 2029, 2030.
When you look at the legislation in the European Union, there are several regulations that talk about 350 kilograms per megawatts, then you can run your business activity. It means that those units can work on a particular number of days throughout the year. It means that they are also needed. Of course, it requires special legislation and decisions. The system of work on these units, which somehow makes them work different than they were designed, does not help at all. On one hand, CapEx that needs to be done, and on the other hand, this supplementary system of support. It is possible. We believe in it, and those units can operate. Of course, there needs to be demand for it, and it needs also a proper business plan and business case.
Wojciech Jakóbik would like to ask another question, so let us give him the floor.
Thank you. A quick question about the profitability of more investments like offshore, because TAURON used to communicate about it. Now there are many geopolitical issues, and I can see that it is not as profitable as before. What is its effect on the long-term plans and also energy prices? Because PGE Polska Grupa Energetyczna gave the specific cost of energy from coal and gas, and the conclusion is now that coal production is more profitable right now. It is over PLN 200 of difference. What is your data on it?
The first question first. Our strategy is clear when it comes to the renewables. Wind farms will continue to be the default. We have a share in one joint project with PGE Baltica, and this is now the project which has been undergoing an intense phase of preparation, so there are no plans to boost the scale of offshore planning. If you think about profitability of renewables, now commercial PV without storage is a difficult business case. That is why we are looking for preferential funding options or any additional advantages from projects. Also, with the hybrid formula with storage and wind onshore, here the supply is quite low. The general master plans in Poland are now coming into effect, so this blocked new project for some time. Now you can either buy existing projects or buy projects which have a long and difficult history.
Now, if you have a good and well-configured project with good wind conditions, it is and will be profitable, but there are few projects that meet these conditions. This situation is going to change. Two years ago, there was a legislation amendment. Once the master plans have been approved, this is expected to happen this year already, there will be more projects available, and we think that they might be attractive economically speaking. Talking about the prices, it was, of course, most profitable to benefit from wind and from the sunlight, which means that coal is to be eliminated. Of course, we are talking about the long-term plan, and with the high prices of gas, a lot of countries load their batteries, their storages. It's more profitable now to use coal than gas. That's the reality.
Getting back to the first question, actually, if there is a lower demand for supply of coal and there's going to be a demand, the market is going to react. Somehow we don't know what the situation is going to be like, I mean, the supply versus demand, and we don't know what's going on between gas and coal, what's going to happen there. I feel quite humble to talk precisely what's going to happen in few months. I don't want to predict anything for sure. Answering your question, yes, we have some data, but we don't share them in a really transparent way.
As Mr. President said, we can see that our profitability has risen, especially the production from coal, and we just applied it in the first half of our year, and we can see an increase in production and increase in supply on the market, especially in the situation with higher prices. We try to take benefit of this situation, and we try to build on the margin on the commercial use.
Another question is coming. Rafał Zasuń, WysokieNapięcie.pl.
I would like to ask you about the G tariff price. From your perspective, with your contracts, is it possible to have the same level of the tariff, also bearing in mind that there is going to be election in Poland and depression is going to be high?
The second question is that I have seen EBITDA and volume, but can you show us the number of customer in small and medium enterprises and business? Is this number growing or falling?
Second answer is growing. We are going to find this number soon. There is an increase in small and medium enterprises and, of course, households as well. This is the trend that we somehow changed. It was challenging. Right now, on this competitive market, small and medium enterprises are the most competitive market, so we've managed to change this trend. They are coming back to us. This increase is really positive. We have more and more customers. The first part of questions was some kind of, I think, intellectual hack on me. Of course, I'm not going to talk about the G tariff for the next year.
I would like to say one thing. I think that we spent too much time on tariffs. I can tell you the price of energy for the next year and even for the next 10 years. We do not need to wait for this tariff, actually, because the price of energy, which is PLN 495 , can be the same for the next four or five years or nine. When it goes about the tariff, I understand your idea why you ask such a question. Actually, it is ahead of us. There is a resolution that has just been into effect. So it means that subscription fees are going to be changed and moved or split into two, in the permanent ones. Right now we are applying to the regulatory office, and then we are going to apply for the next year. Nine years, yes.
Nine -years plus this permanent charge, and there is also a kind of guarantee for that. So there is a kind of guarantee for the customer that the product is going to leave our company, and we run some such company with Polish insurance company, PZU, and that is a particular value, and 50% of our customers have already had products with such guarantees. I mean, dynamic products with Tanie Godziny, and this is the direction that we believe the most interesting one. So in each tariff group, we have had an increase in households, in businesses, and in large businesses was the highest. Actually, in every tariff group, there has been an increase half year on half year. It is about 8% on average, but in large business it was even, I believe, 10%.
Somehow I have a feeling that I did not address the question straightforward. As you understand, it is a really sensitive element of our work.
Another question.
Good morning. I am Marek Kolanowski, WNP.pl. The first question is, when are you expecting to award the job of the contract engineer for Jaworzno? Going back to the capacity action, except for Nowe Jaworzno, what capacity of coal units will be outside of the capacity market at the beginning of 2027? What will be their role? Will they be a backup for the contracted units, or will they have a different function? Thirdly, as to your expert knowledge and insider information, what are the chances for the exchange-traded bonds, listed bonds for electricity to come back? Is it likely to come back? Thank you.
Let me begin with the issue of the contract engineer, that the procedure is ongoing, and in Q4 it should end, and we will select the engineer. Depending on the questions in the procedure, et cetera, it might be October or later, but this is the expected deadline. Now the capacity auction. With every auction, the strategy and the situation is different. Now, 200 units are a backup for other units. This is how we joined the capacity market. We won the capacity market for all the units, and the 200 units are now operating in Łaziska, Jaworzno, Łagisza, Siersza. Yes, everywhere. This is because of stress. They function based on the terms of the capacity market or as a backup.
Let me not reveal the secret of what and where, because next year we are also going to take part in the auction, and it is different than last year. Probably, next year it is also going to be different. Unfortunately, it is off mic. I do not know. We always adapt to the regulatory situation, so the fewer the changes, the better for us. Speaking about the bonds, we were clear in our communication about our position, and this has not changed, but whether this will come back, well, we have no idea. Also, there are many things now ongoing, the financing huge investment projects, the capacity auction issues, the transition of the industry. So there are many variables here we need to take into consideration.
Paweł Puchalski, Erste Bank Polska. I have two simple questions. First, the level of contracting in TAURON, speaking about the energy sold for 2027.
Chair, you focus on customers, but I am always focused on EBITDA, and I am looking at the EBITDA in Q2. There is a loss of PLN 7 million. Is it something you would expect to repeat in the quarters to come, or maybe there was an exceptional situation that took place in this quarter?
Well, speaking about the contractation, the segment of supply, well, you have to split the portfolios. You have the tariff portfolio, which means that the purchase is made ahead, and most of the electricity is already secured. I am not going to give you the specific figures, but this is the general market practice in this portfolio. Now, the business segment. My answer will not be a direct one. We are very conservative there in terms of backing up. So here, this is back-to-back. Every supply contract is secured simultaneously on the market.
We secured 100% of the energy, but the peak season is already ahead of us, the peak contracting season, so we will have to secure the portfolio additionally in this time. We told you last year that there is this risky element last year of business contractation. This is what we communicated last year. That is why for the whole year, we have been working to convert our customers to make them switch to the market-based options where the risk is smaller. This has an effect on the margin as well. But it is very good in terms of the risk, especially if the price is volatile. So there has been a question about the loss. Strategically, I will pass this on to Krzysztof.
Yes, as I have said, this segment is not performing very well this year in terms of EBITDA.
We are under a huge pressure here because the G tariff is relatively low, and the profile cost is growing. So Q3 is not going to be favorable for the profile cost because this is when this cost is the highest and the price difference is the highest usually. So the segment will continue to be under pressure till the end of the year.
Ladies and gentlemen, are there any more questions? Just please be brief. There is one very emotional issue for prosumers, the clearing. Why the 31st August was set as the clearing date, because it is not good for those who use more energy in the winter, because they will pay more in the winter, and they will not be able to get the money back until the summer. It would be easier to set the date for the 31st of December.
Yes, you could have done it, but the settlement, the clearing actually settles the actual use of energy, the actual consumption, which affects your bills. Prosumers, the best option for them. In metering, please bear in mind that this 1.2 million customers, it's a huge promo program. Customers use the network as a storage. This is a huge topic, a huge burden for the industry. Yes, we opted in. Now, six or 12 month settlement periods is a huge disruption for the segment, because you have to make forecasts for the consumption and generation of electricity. You can easily make a mistake, and this costs. Also, it's a burden for the customer service. It's also problematic for the customers themselves. All the prosumers have smart meters and 24 hours data access. They have an app.
The real actual one-month settlement period or two-month is the best for both parties. You pay per use, or then you gain thanks to storage.
Now let's move on to questions online, which are asked in our form. The first one is, how much has been already spent from the pool of low-cost loans under the National Recovery Plan, and when will we see a more significant reduction in financing costs as a result?
As you could see in the slides, those preferential financing and also financing in the program. It's about PLN 2.6 billion on the 30th June, and it was received from National Recovery Plan. This is kind of refinancing. It means first we spend, and then we apply for refinancing. On the next slide, you can also see that it's about PLN 17 billion. Now the cost of financing, which you could see in the first half of the year, there was a significant decrease, about PLN 80 million. It's the interest cost on half year.
I believe it's a significant decrease. How big is the influence of National Recovery Plan versus other financing? It also applies to the value of the market in the next several years, when this debt is going to be due. It's 1 percentage point, PLN 601 billion. With a simple assumption, we can say it's 5 percentage points between the market. The year scale is about more than PLN 100 million, PLN 130 million, let's say. The difference is 5 percentage points. If we consider the whole scale of PLN 17 billion, 1 percentage point is about PLN 170 million in savings per year. Actually, we are not able to say really precisely the cost of financing in the perspective of several years.
If we can observe the costs of financing bonds and profitability, which is about 6 percentage points, and if we know that the majority of this statement is 0.5 percentage points, this is the difference of 5 percentage points between the preferential financing and commercial debt. But whether the profitability and financing is going to be about 6%, I believe it is quite high percent, but I cannot predict it. It is about PLN 170 billion a year.
What impact are the sharp rises in energy prices having on the company's result, and does this not pose risk for trading next year? How does this affect energy repurchase in conventional generation?
The answer is going to be divided into two periods. Current year, which we have already mentioned. Our hedging policy is conservative.
Entering the year of execution, most of our positions are closed, and there is no exposition to risk, which actually, it is pretty limited. This is how it happened, and I mentioned it before. We took advantage of this chance and the CDSs were used by us, and now referring for the part of influences. It affects our productivity, so increased our productivity and the sales from repurchase. Now to show you the scale. The repurchase was about 700 GWh and now it is about 700 right now. The contracting is undergoing right now, and the increase in prices of the energy is not really significant as much as volatility. The price changes, and we want to see it as a kind of chance rather than risk. We want to also secure risk on the side of costs.
Is the increase in coal consumption and conventional generation within the group accounting continuing in the third quarter and likely to persist in the coming month? If so, are supplementary coal purchases required? What are the volume sources of the coal and, of course, prices involved?
Again, I think I have already answered this question. Just to sum up, the energy sale contracts all include secured contracts.
Next question. I would like to ask what year-on-year growth in CapEx can we expect in 2026?
CapEx in 2026 are going to foster and accelerate a lot of projects which are in the first phase right now, but then are we going to start this stage of financing. There are some events which can affect the yearly result, especially the difference between investment and expenditure, like in Miejska Górka.
It can really affect the expenditure, and there are some projects of acquisition of renewable sources of energy, which can finish in a positive or negative way. But generally, the distribution in those projects year-on-year is as in the first half year. Renewables and in wind farms, in heat sector, they are accelerating. It is hard to say, because there are a lot of factors that can influence this level. However, this expenditure are going to rise much more quickly than previous year, and I believe that this year is going to be more than last year, but let us say maybe 20%, maybe 30%, but it depends on a lot of factors. The consensus EBITDA for 2026 is approximately PLN 6.62 billion.
Do you consider these to be ambitious assumptions?
You know that we do not post our forecasts, so this consensus and the forecasts are pretty wide.
There is no one answer, let's say. However, is it ambitious? I would like to bear in mind the financial results from the first half of the year, and maybe, yes, maybe I can say it is an ambitious scenario. If you analyze some situation and you believe it's something really ambitious, then we try to really deliver it, even if it's on the border with kinds of miracles. Somebody's listening to our conference today. If we're talking about prosumers and the payment is going to be done every month, it's going to be a monthly payment per real use and production generation. But everything what the prosumer has gathered in their batteries, it also brings benefits, I mean amounts, for example. Everything is going to be included in monthly settlements.
For example, if somebody has used energy in the winter but stored in summer, it's going to influence the price. The method of payment doesn't influence how much energy has been stored. There is no possibility, it's going to be zero payment.
Can you say something about DPS for 2027? The consensus is 20 groszy, or PLN 0.2 per share. Is it realistic given the CapEx?
Let me make a reference to our policy, and our dividends payment for 2025. There are many factors at play here, our financial results, our liquidity, and the planned CapEx. But in 2026, we communicated that we would like to start paying the dividend, and we would like it to be a permanent process, not a one-off. I'm not going to speak about the amount. We have set our goals and communicated that clearly, and this doesn't change. We will always be conservative when it comes to our financial capacities, but this was our goal in mind when we started paying dividend in 2026. This management board has the ambition to carry through transition and also share the profit.
Dividend is very important to us as we said from the very beginning, we will do whatever we can to make it possible.
Ladies and gentlemen, thank you. The conference ends now, and you can continue talking after the break and the earnings call for Q3 will be organized in the middle of November. Please join us and thank you. Also, there's one important event, the Energy Days ahead of us. Energy Days, 1st of October at 11:30 A.M., there will be a round table, TAURON's round table. I would like to advertise Tanie Godziny. This is a very good program. Thank you.