Current Report No. 31/2018

Title: Preliminary results of the capacity market main auction for 2021provided by Polskie Sieci Elektroenergetyczne S.A.

In reference to current report no. 30/2018 of November 15, 2018 TAURONPolska Energia S.A. ("Company","TAURON") announces thaton November 20, 2018 Polskie Sieci Elektroenergetyczne S.A. ("PSE")provided the preliminary results of the capacity market main auctionconducted on November 15, 2018, as part of the capacity market mechanism("Auction").

In accordance with the information published by PSE the Auction'sclosing price reached 240.32 PLN/kW/year, and TAURON Group's companiesconcluded capacity agreements for the total volume of capacityobligations amounting to 2,672.5 MW, including the agreements for:

a) 17 years (i.e. for 2021-2037) with the capacity obligation of 4.7 MW,under which the annual revenue estimated by the Company will reach PLN1.12 million,

b) 15 years (i.e. for 2021-2035) with the capacity obligation of 768 MW,under which the annual revenue estimated by the Company will reach PLN184.57 million,

c) 5 years (i.e. for 2021-2025) with the capacity obligation of 1,474MW, under which the annual revenue estimated by the Company will reachPLN 354.23 million,

d) 1 year (i.e. for 2021) with the capacity obligation of 425.8 MW,under which the annual revenue estimated by the Company will reach PLN102.34 million.

Taking the above into account the Company estimates that TAURON Group'srevenue from the Auction will reach:

a) in 2021: PLN 642.25 million,

b) in 2022-2025: PLN 539.92 million per year,

c) in 2026-2035: PLN 185.69 million per year,

d) in 2036-2037: PLN 1.12 million per year.

In accordance with the act of December 8, 2017 on the capacity market,the final results of the Auction will be announced by the President ofthe Energy Regulatory Office in the Bulletin of Public Information(Biuletyn Informacji Publicznej) on its website, on the first workingday following the 21st day from the day of closing the Auction, i.e. onDecember 7, 2018. Under the above act, until the final results of theAuction are announced, TAURON Group's companies' capacity agreements areconcluded under a suspending condition.

In case the final results of the Auction differ significantly from thepreliminary results of the Auction, based on which the Companycalculated its estimated revenue from the Auction, the Company willdisclose the accordingly adjusted data.

Legal basis: art. 17, clause 1 of MAR - inside information