Tauron Polska Energia S.a. · GPW:TPE
Tauron Polska Energia — Investor Day (December 2024)
38 slides from Tauron Polska Energia's investor day presentation, December 2024
Slide 1: TAURON Group Strategy for 2025-2035
TAURON Group Strategy for 2025-2035 December 2024
Slide 2: Agenda
TAURON Group Strategy for 2025-2035 Agenda 1 Where we are 2 Strategic Priorities of the TAURON Group 3 TAURON Group Strategy
Slide 3: Business development is a relay race
TAURON Group Strategy for 2025-2035 In 2019, TAURON launched the Group’s transition process Business development We are determined to deliver on our promises and plans is a relay race Commencement of TAURON NOWA energia decarbonization of district heating and construction of Obtaining an NRP (Nation
Slide 4: Modern energy group with assets concentrated in Southern Poland
TAURON Group Strategy for 2025-2035 Modern energy group with assets concentrated in Southern Poland Distribution Generation assets under construction Photovoltaic farms Hydro power plants ▪ Number of Customers: 5.9 million Electricity distribution Wind farms Local CHP plants Coal/gas-fired ▪ Distrib
Slide 5: Group with enormous upside
TAURON Group Strategy for 2025-2035 Group with enormous upside Number of Customers Electricity distributors in Poland Volume of electricity distribution [TWh] 5.9 TAURON 51.3 5.7 PGE 38.9 37% Market 3.3 Energa 22.4 share 2.8 Enea 20 #1 Largest distributor of electricity in Poland Suppliers of electr
Slide 6: TAURON from shareholders' perspective
Strategia Group TAURON Stock price on “ Grupy TAURON Strategy 2025 for - 2035 2025-2035 We believe that TPE shares will still be attractive relative to PGE and Enea, even if the coal asset carve-out does not occur in the 16 December 2024 near future. Tauron's current business model (limited exposure
Slide 7: TAURON in the eyes of our Customers
TAURON Group Strategy for 2025-2035 TAURON in the eyes of our Customers Customer satisfaction ratios on the rise ▪ TAURON is the most 70 64 frequently considered 60 brand among electricity MEETING OUR GROWTH 53 51 50 suppliers PROMISES 44 40 32 ▪ TAURON is one of the best 30 18 rated electricity sup
Slide 8: What we believe in
TAURON Group Domestic electricity consumption [TWh] Strategy for 2025-2035 ARE2024 ARE 2024 300 KPEiKWAM KPEiK WAM Decarbonization and electrification Growing importance of distribution 280 KPEiKWEM KPEiK WEM ▪ Moving away from fossil fuels and the need to ▪ Strategic role of distribution in the dev
Slide 9: Agenda
TAURON Group Strategy for 2025-2035 Agenda 1 Where we are 2 Strategic Priorities of the TAURON Group 3 TAURON Group Strategy
Slide 10: Responsibility, Commitment, Efficiency and Energy
TAURON Group Strategy for 2025-2035 RESPONSIBILITY COMMITMENT EFFICIENCY AND ENERGY ▪ for our Customers’ comfort, safety ▪ to meeting evolving challenges ▪ in creating value for shareholders and bills ▪ to building competitive advantage for and Customers ▪ for future generations, employees ourselves
Slide 11: We power the change with New Energy
TAURON Group Strategy for 2025-2035 We power the change MISSION with New Energy ▪ to build a sustainable competitive advantage and take a strategic position in the New Energy World ▪ to create sustainable economic value for shareholders and investors ▪ to deliver tangible value to Customers and loca
Slide 12: Vision
TAURON Group Strategy for 2025-2035 We will create a New Energy World focused on green solutions that provide comfort and Vision security for our Customers GRADUAL PHASING OUT OF CONVENTIONAL POWER GENERATION AND COMMERCIALIZATION OF SITES HEAT PRODUCTION TRANSITION SUPPLY AND CUSTOMER SERVICE SHARE
Slide 13: Strategy of growth around the core business
TAURON Group Strategy for 2025-2035 Strategy of growth around the core business 3 steps from the core 2 steps from the core 1 step from the core Core 6 million connected to our distribution network, Customers 6 million buying electricity from us, Customers preferably from our RES sources low chance
Slide 14: Business Priorities of the TAURON Group
Strategia Group TAURON Grupy TAURON Strategy 2025 for - 2035 2025-2035 Business Priorities of the TAURON Group STRONG AND STABLE FINANCIAL POSITION Customer focus and Profitable expansion of Decarbonization Customers are the focus Just transition of dynamic development RES and energy storage and imp
Slide 15: Strategic performance indicators
TAURON Group Strategy for 2025-2035 Strategic performance indicators ▪ EBITDA doubled by 2035 EBITDA ▪ EBITDA: >PLN 9 billion in 2030, >PLN 13 billion in 2035 ▪ IRR for investment projects >1.5 p.p. above the cost of capital PROFITABLE ▪ Ensure profitability of sales across all Customer segments and
Slide 16: Modern management model of the TAURON Group focused on value creation
TAURON Group Strategy for 2025-2035 Modern management model of the TAURON Group focused on value creation MANAGEMENT BOARD OF TAURON POLSKA ENERGIA BU - BUSINESS UNIT EGM – EXECUTIVE GROUP MANAGEMENT EBUM – EXECUTIVE BUSINESS UNIT MANAGEMENT GROUP FUNCTIONS Distribution RES Heat Wholesale Supply Cus
Slide 17: Agenda
TAURON Group Strategy for 2025-2035 Agenda 1 Where we are 2 Strategic Priorities of the TAURON Group 3 TAURON Group Strategy
Slide 18: EBITDA doubled by 2035
TAURON Group Strategy for 2025-2035 EBITDA doubled by 2035 18% EBITDA 2023 EBITDA 2030 EBITDA 2035 Other Other Other PLN 0.2 bn Generation PLN 0.2 bn Supply PLN 0.2 bn Supply Supply RES and energy PLN 0.6 bn PLN 1.1 bn PLN 1.6 bn RES and energy 3% PLN 1.1 bn 2% storage 2% storage 10% 18% 12% PLN 2.0
Slide 19: TAURON Group capital expenditures
Strategia Group TAURON Grupy TAURON Strategy 2025 for - 2035 2025-2035 TAURON Group capital expenditures 90% of capital expenditures earmarked for distribution and RES investments CAPEX CAPEX 2012-2023 2024-2035 4% 5% 5% 60% 6% expansion and modernization of the 45 30% distribution network PLN bn 53
Slide 20: Stable financial position and use of new financing sources
Strategia Group TAURON Grupy TAURON Strategy 2025 for - 2035 2025-2035 Stable financial position and use of new financing sources NET DEBT/EBITDA < COVENANT Covenant level 3.5x Financial stability with safe debt ratio levels Covenant level 2.0x Retaining TAURON’s investment grade rating 2023 2035 FI
Slide 21: Start of dividend payments after 2028 at PLN 0.50 per share
TAURON Group Strategy for 2025-2035 Start of dividend payments after 2028 at PLN 0.50 per share Dividend of up to 20% of net profit 0.7 PLN per 0.5 share PLN per share 6% annual growth 2029 2030 2031 2032 2033 2034 2035 Dividend payout criteria will be in line with the Code of Best Practice for WSE
Slide 22: Customer focus and dynamic development of distribution
TAURON Group Strategy for 2025-2035 Customer focus and dynamic development of distribution Capital expenditures [PLN bn] ENSURE SECURITY OF ENERGY SUPPLY +100% DISTRIBUTION FOCUSED ON CUSTOMERS FOR CUSTOMERS >6 >5 ▪ Proactive partnership in regional development ▪ Leader in reliability of energy supp
Slide 23: Our vision for distribution
TAURON Group Strategy for 2025-2035 Our vision for distribution Digital distribution operator ▪ Development of assets based on advanced analytics and demand forecasting ▪ Dynamic management of storage units and external flexibility ▪ Full utilization of data from remote meters ▪ High connection capa
Slide 24: Profitable increase in RES and energy storage capacity
TAURON Group Strategy for 2025-2035 Profitable increase in RES and energy storage capacity RES installed capacity [GW] +570% CONSTRUCTION OF WIND FARMS DEVELOPMENT OF ENERGY STORAGE Offshore 4.7 0.4 GW AND PHOTOVOLTAIC PLANTS BASED ON TO STABILIZE THE OPERATION OF RES AND CUSTOMER DEMAND SUPPORT THE
Slide 25: Decarbonization and improvement of thermal efficiency
TAURON Group Strategy for 2025-2035 Decarbonization and improvement of thermal efficiency REPLACEMENT OF COAL-FIRED SOURCES CONFIGURATION TO TAKE ADVANTAGE OF Heat storage - capacity [TJ] ENERGY PRICE VOLATILITY AND SUPPORT 12.1 12.1 WITH MODERN LOW-CARBON UNITS THE GRID ▪ All major heat source site
Slide 26: Customers are our focus
TAURON Group Strategy 2025 - 2035 Customers are our focus “ A customer is the most important visitor on our premises. He is not dependent on us. We are dependent on him. He is not ▪ Customer is the core of our business ▪ We help Customers achieve their personal and business goals ▪ We are committed
Slide 27: Demand and Customer
TAURON Group Strategy PROFITABLE EXPANSION AND for 2025-2035 DEVELOPMENT OF PRODUCTS, SALES Sales volume [TWh] CHANNELS AND SERVICES +29% 40 ▪ Fiercer competition / CSIRE as an accelerator 31 33 Demand and Customer ▪ 40 TWh of electricity to be sold to existing and new Customers across Poland in 203
Slide 28: By 2040, 100% of the energy consumed by customers from renewable or zero-carbon sources
TAURON Group Strategy for 2025-2035 By 2040, 100% of the energy consumed by TAURON’s customers will originate from renewable or zero-carbon sources GREEN ENERGY SALES 86 thous. Customers 1 m Customers 3 m Customers (1.7%) (16%) (47%) TWh 0.24 TWh/year 8.5 TWh/year 17.8 TWh/year 100% CLEAN ENERGY BY
Slide 29: We are removing barriers to developing electromobility in Poland
TAURON Group Strategy for 2025-2035 We are removing barriers to developing electromobility in Poland ▪ Electric cars, as distributed energy storage units, support energy transition ▪ TAURON Customers will be able to charge their electric cars using a newly-built network of charging stations ▪ This w
Slide 30: Green evolution of TAURON's portfolio vs. energy mix
TAURON Group Strategy for 2025-2035 "Green evolution" of TAURON's portfolio vs. energy mix 400 [TWh] Generation structure according to the aKPEiK project Zero-carbon energy High availability of zero-carbon energy in in 2040 the system and favorable legislation 350 89% 300 250 Zero-carbon energy PV i
Slide 31: Just transition of conventional power generation
TAURON Group Strategy for 2025-2035 Just transition of conventional power generation GRADUAL PHASING OUT OF OPERATIONAL EFFICIENCY CONVENTIONAL GENERATION ▪ Profitable operation of coal-fired units based ▪ Maintaining adequate availability on the capacity market (projected end of Jaworzno ▪ Optimizi
Slide 32: Installed capacity mix [GW]
Strategia Group TAURON Grupy TAURON Strategy 2025 for - 2035 2025-2035 Installed capacity mix [GW] 2023 5.1 GW 2030 3.5 GW 2035 6.3 GW 0% 8% 1% 4% 2% 2% 3% 7% 3% 1% 2% 2% 21% 38% 42% 22% 86% 29% 27% Wind 0.4 GW Wind 1.5 GW Wind 2.4 GW PV 0.1 GW PV 1 GW PV 1.7 GW Battery storage & PSPs 0.7 GW Battery
Slide 33: Our path to climate neutrality
TAURON Group Strategy for 2025-2035 Our path to climate neutrality 2025-2030: No coal-fired electricity and heat • Decarbonization of heat generation generation after 2030 • Construction of renewable energy sources • Gradual phasing out of coal-fired units 2030-2040: Climate neutrality in 2040 • Con
Slide 34: OZE2 form the foundation of TAURON's Strategy
TAURON Group Strategy for 2025-2035 and OZE2 form the foundation of TAURON’s Strategy E ENVIRONMENT Responsible use of natural resources and concern for the climate ▪ Construction of RES and energy storage units S SOCIETY Favorable social impact and building a sustainable work environment ▪ Partners
Slide 35: Sponsorship and promotion, CSR and the TAURON Foundation
TAURON Group Strategy for 2025-2035 We focus on open and effective communication We establish relationships based on trust and cooperation We are a committed brand SPONSORSHIP AND CSR AND THE PROMOTION TAURON FOUNDATION ▪ We support sports that encourage active and ▪ We conduct educational activitie
Slide 36: Energy generated by People and for People
TAURON Group Strategy 2025 - 2035 Energy generated by Organizational culture based on OZE2 values Focus on value creation People and for People Developing and deploying innovative solutions Respect, cooperation, equal opportunities Committed and competent employees Inclusive work environment Just tr
Slide 37: We change with People and for People
TAURON Group Strategy for 2025-2035 Shareholders Local communities We change Clients with People Climate and and for People environment Employees Thank you for your attention Suppliers Business
Slide 38: Disclaimers
TAURON Group Strategy for 2025-2035 Disclaimers This presentation has been prepared by TAURON Polska Energia S.A. (“Company”). By reading this presentation or attending a meeting at which this presentation is delivered or discussed, you agree to abide by the following legal disclaimers. The purpose