Strategy in action innovations and new activities

We realise that some years from now the energy industry as we know it today will be just a memory. Research on-going around the world is contributing to the rapid development and, more importantly, commercialisation of new technologies, which will certainly have an impact on the market model in the coming years. We do not want to stay behind, which is why in our strategy until 2020 innovations are one of the key elements. By speaking of innovations, we think about not just completely new technologies or products on the energy market but also searching for solutions that can considerably contribute to changes in our core business lines, i.e. the mining segment and electricity generation and distribution segments.

We believe that in modern conventional energy innovative solutions will create competitive advantages and contribute to reducing environmental footprint, in line with circular economy rules. Taking into account stricter climate policy, new environmental standards and coal mining costs using existing technologies, waste storage costs and increase in uncontrollable sources, we are taking actions intended to optimise replacement activity and automation system development in lignite mining, application of innovative technologies reducing SO₂, NOx, particular matter and mercury emissions in electricity generation. Reducing machinery maintenance costs or reducing start-up times for generating units will contribute to maintaining competitiveness in lignite mining and adapting generating assets to the changing energy market model. We are carrying out periodic optimisation projects. From June to November 2016, employees of Elektrownia Bełchatów submitted 73 improvements that make their work safety and more efficient.

Modernized flue-gas desulphurization installation (FDG) at units 5 and 6 in Bełchatów Power Plant won the highest grade in both jury vote and internet plebiscite during the XXI edition of Poland’s countrywide contest “The Modernization of the Year 2016”, within the category of industrial-engineering enterprises.  

Challenges in the electricity distribution sector such as introducing quality regulation or increase of dispersed generating sources are causing us to seek innovations also in this segment: developing a system for monitoring the quality of electricity, distribution grid automation, implementing grid management methods in the context of an increasing share of dispersed sources are just some of the directions in which we innovate. 

All of our activities are intended to increase overall system efficiency - fewer failures, faster failure identification and thus faster repairs. In effect, clients connected to the company's network will benefit from eliminating long and very long interruptions in electricity supplies. Reducing the work time of teams tasked with locating damages is bringing measurable financial benefits, which than in the tariff process translate into lower rates for customers.

The second side of innovation is the development of new technologies. In our strategy, we set an ambitious goal of becoming a leader in new business models and operating areas. Smart grid, energy warehouses, electric transport or dispersed energy sources are examples of new solutions and technologies which we will be looking at especially closely. Electromobility is one of the projects that we are currently intensely developing. The aim of this project is to promote and develop electric transport in Poland. In October 2016, ElectroMobility Poland S.A. was formed (in cooperation with the other three energy majors in Poland), which is tasked with dynamically developing individual electromobility in Poland. To this end the company announced a competition for electric car body designs.

This project also includes a pilot construction of electromobility system infrastructure in Łódź. The pilot's purpose is to verify a business model based on fleet cars and the possibility of replicating it in other locations. PGE will manage charging infrastructure and provide quick charging services and successively increase the scale of business and improve client offerings. 

Aside from solutions for individual clients, PGE has also started cooperation with bus manufacturers in order to develop, test and prepare for commercial implementation a public transport model based on electric buses and providing for further use of batteries after their lifecycles in vehicles are over. This issue is particularly important for improving the economic results of the entire usage model for electric vehicles, which is most burdened by battery costs.

We are also involved in a recycling project that aims to develop and introduce a new technology for the recycling of lithium batteries, particularly those used in systemic energy warehouses and for charging electric vehicles, intended to obtain strategic materials from used lithium batteries: cobalt, nickel and copper. This is an important project because of forecasts of dynamic growth in the markets for these materials and Polish legislative requirements specifying the need to collect and utilise used batteries.

Other activities include the formation of PGE Ventures, which is focused on working with start-ups and PGE's joining work on project Kampus+, led by the Warsaw University of Technology, which aims to create the largest innovation hub focused on smart living in Central and Eastern Europe. In the search for new revenue sources, PGE will test innovative solutions in the living lab formula in three key areas - smart home, smart city and vehicle-to-grid.

We will spend a total of PLN 400 million on research, development and innovation by 2020, half of which will be our own funds.