Commencement of negotiations with EDF Investment SAS

The Management Board of PGE Polska Grupa Energetyczna S.A. (the"Company"), with reference to current reports no. 55/2016 datedSeptember 16, 2016 and no. 68/2016 dated November 30, 2016 on submissionof the offer with partners for acquisition of assets of EDF InvestmentSAS ("EDF") in Poland, discloses that on January 27, 2017 the Companyjointly with ENEA S.A., Energa S.A. oraz PGNiG Termika S.A. (the"Business Partners") has signed an agreement (the Memorandum ofUnderstanding) with EDF concerning the negotiations on the purchase ofEDF assets in Poland (the "Transaction") and due diligence regardingthis case.

The Transaction includes:

(i) acquisition of all shares of EDF in EDF Polska S.A., which is theowner of in particular: 4 CHPs i.e. Kraków, Gdańsk, Gdynia and Toruń,district heating network in Toruń, Rybnik power plant, and

(ii) acquisition of all shares of EDF in Zespół ElektrociepłowniWrocławskich Kogeneracja S.A., which is the owner of 4 CHPs i.e.Wrocław, Zielona Góra, Czechnica and Zawidawie and district heatingnetwork in Zielona Góra, Siechnica and Zawidawie.

Business Partners agreed that the submission of the potential bindingoffer shall be possible after the completion of the due diligence, whichwill be the basis for the further decisions about the Transaction.

The Company will inform in a separate current report on the conclusionof a legally binding documentation relating to the Transaction or thecompletion of negotiations on the Transaction in another way.