01.10.2010 Corporate presentation - TAURON Polska Energia

Polish distribution RAB – brief overview1• ―Old‖ RABs of distribution companies have been revalued to reflect their full economic value (―full RAB‖)• Going forward, in line with the regulatory RAB formulas it is understood that RABs will be increased bynew investments, decreased by RAB depreciation and also impacted by some other auxiliary items (gridconnection charges and other corrective coefficients)2• ―Full RAB‖ will not be reflected in regulated revenues and distribution tariffs straightaway – asmoothening mechanism has been introduced• RAB Return will increase by 1.5% of last year’s adjusted Regulated Revenue plus return on newinvestments (cumulative) (―transition‖ formula) as long as the so calculated RAB Return is lower than―standard‖ RAB return (RAB * WACC) on ―full RAB‖• ―Full RAB‖ is therefore not effectively remunerated in whole in the initial ―transition‖ period3• Key components of the Regulated Revenue• RAB Return• RAB Deprecation, reflecting new investment capex• Other:• Under /overperformance components with key parameters approved by the Regulator (i.e.justified opex and network losses) incentivising the Company to introduce greater efficiencies• Other pass-through items37