ENEA and ENERGA have suspended payments of the dividends for 2017. Representatives of the Association Workshop for All Beings participated in the Annual General Meetings (AGM) of these utilities to confirm whether these funds will be used to finance the Ostrołeka C coal power plant and to ask questions about its profitability. ENEA refused to answer, ENERGA declared to respond within 14 days.
The Annual General Meeting (AGM) is the occasion when shareholders may ask questions to the Management Board. During the Enea (25.06) and Energa (27.06) AGMs, the representatives of the Association Workshop for All Beings asked questions about the conditions under which Ostrołęka C would be profitable (including capital costs, support from the capacity market, various EUA growth scenarios, electricity price levels, energy production hours and competition with renewable energy sources). The questions involved the issues of finance, insurance of the investment, the validity of its integrated permit (its adaptation to the BAT standards) and concerns about the deterioration of the economic situation of already operating coal power plants (including the Kozienice power plant which belongs to Enea).
Enea refused to answer the questions, referring to the article 428 paragraph 2 of the Commercial Companies Code stating that the Management Board may refuse to provide information “if it could cause damage to a company in particular by disclosing technical, commercial or organizational secrets of the enterprise”.
The Energa Management Board did not provide for the possibility of asking questions during the Meeting but it committed to reply in writing within 14 days. One of the individual shareholders who wanted to know if Energa was realizing the RES development objective enshrined in the Strategy for the years 2016-2025, was allowed to express his opinion just after the Management Board had left the room. In practice this person spoke to the empty seats.
Without giving any area for a dialog with the Management Board, there is no realization of the best investor relations practice. Last year, the company answered our questions in writing and in general form, avoiding inconvenient topics. We hope it will not follow along Enea and will not avoid giving exact answers to our questions - says Diana Maciąga from the Association Workshop for All Beings, who participated in the Energa AGM.
During the AGMs of both companies, shareholders voted to stop dividend payment for 2017, which may be directly related to the difficulty in financing the construction of Ostrołęka C.
In 2017, Enea generated a net profit of PLN 1.8 billion. The entire amount will be allocated to "increasing reserve capital for financing investments". As follows from the justification of the Management Board of Enea S.A. among these investments is the construction of the Ostrołęka C coal power plant. Energa did the same. PLN 106.6 million is to be allocated to supplementary capital.
Decisions on non-payment of dividends seem to confirm that Enea and Energa have difficulties with raising funds for the construction of Ostrołęka C. While leading financial institutions do not want to finance socially harmful projects, companies reach directly to the shareholders' pockets to pay their coal ambitions - comments Klaudia Bort, representative of Association Workshop for All Beings at AGM of Enea.
The Enea and Energa companies collaboratively conduct the investment process of the new power plant Ostrołęka C with a capacity of 1000 MW. The project has been criticized by industry experts who question its cost-effectiveness and indispensability for the energy system. They also point out that the real costs of its construction can be significantly underestimated and that it will deteriorate the economic conditions of other units of this class, including the Kozienice power plant belonging to the Enea group. It was also undermined in reports prepared by independent experts who forecast its negative impact on the region.
Diana Maciąga, Association Workshop for All Beings, tel. +48 502 646 890, email@example.com;