Total expected sustainable result of the Programme on consolidated EBIT of the PGE Capital Group is to amount approximately PLN 1.53 billion p.a. starting from 2016, as compared to 2010 (a base year for the Programme).

The Programme will be implemented in period 2012-2016 and will consist of two elements: cost reduction programme in PGE Group and increase of revenues from existing activities. Initiatives will be implemented gradually, starting from 2012, to reach the ultimate effect in 2016.

As compared to 2010, the cost-related initiatives will provide for approximately PLN 987 million of savings in 2016 and in subsequent years. The initiatives related to cost reduction include:

1. Increase of organizational structure effectiveness

2. Optimization of repair and maintenance costs

3. Increase of effectiveness of power consumption and reduced network losses

4. Purchases centralization

Revenues-related initiatives, as compared to 2010, will provide for additional revenues of approximately PLN 541 million in 2016 and in subsequent years. Initiatives related to increase of revenues include:

1. Increase of power generation from biomass

2. Increase of sales effectiveness and improvement of customer care services

The costs of the Programme will be carried mostly in 2012-2013. As of 2014, the Programme will have a positive impact on financial results, reaching its full potential in 2016.

Further information concerning the Programme are presented in the presentation attached below.

 Efficiency Improvement Programme