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7. Property, plant and equipment

(a) 2014

LandBuildings and structuresTechnical equipment and machinesVehiclesOther fixed assetsFixed assets under constructionTotal
Balance as at 1 January 2014
Cost 49 520 8 906 244 6 339 315 177 861 501 099 2 098 491 18 072 530
Accumulated depreciation - (3 263 734) (2 567 976) (76 599) (322 926) (590) (6 231 825)
Impairment loss (103) (21 837) - (2) (14) (7 183) (29 139)
Net carrying amount at beginning of the period 49 417 5 620 673 3 771 339 101 260 178 159 2 090 718 11 811 566
Changes in the 12 months ended 31 December 2014
Reclassifications 3 129 680 096 392 714 12 764 45 619 (1 205 475) (71 153)
Acquisition - 24 624 4 347 2 798 1 092 2 415 294 2 448 155
Disposal (cost) -47 (38 376) (6 081) (2 406) -535 (30) (47 475)
Disposal (accumulated depreciation) - 22 194 2 532 2 150 41 - 26 917
Depreciation - (344 037) (309 288) (12 256) (32 989) - (698 570)
Impairment loss (-) (162) (16 131) (12 010) (6) (185) 720 (27 774)
Acquisition of subsidiaries 29 970 170 779 28 890 426 1 910 21 765 253 740
Liquidation (cost) (119) (46 750) (23 158) (866) (54 372) (313) (125 578)
Liquidation (accumulated depreciation) - 41 548 21 844 804 52 311 - 116 507
Other (cost) 1 192 22 706 (28 885) (279) (1 278) (3 405) (9 949)
Other (accumulated depreciation) (1 073) (3 228) 32 389 182 (634) (2 066) 25 570
Balance as at 31 December 2014
Cost at end of period 83 645 9 719 323 6 707 142 190 298 493 535 3 326 327 20 520 270
Accumulated depreciation (1 073) (3 547 257) (2 820 499) (85 719) (304 197) (2 656) (6 761 401)
Impairment loss (265) (37 968) (12 010) (8) (199) (6 463) (56 913)
Net carrying amount at end of the period 82 307 6 134 098 3 874 633 104 571 189 139 3 317 208 13 701 956
property_plant_equipment_2014_enea_2014.xlsx

(b) 2013

LandBuildings and structuresTechnical equipment and machinesVehiclesOther fixed assetsFixed assets under constructionTotal
Balance as at 1 January 2013
Cost 45 597 8 337 103 6 008 196 168 005 470 255 1 038 894 16 068 050
Accumulated depreciation - (2 981 052) (2 241 617) (69 898) (297 767) -563 (5 590 897)
Impairment loss -103 (11 152) 195 -23 -16 (6 677) (17 776)
Net carrying amount at beginning of the period 45 494 5 344 899 3 766 774 98 084 172 472 1 031 654 10 459 377
Changes in the 12 months ended 31 December 2013
Reclassifications 3 944 601 856 375 970 13 126 33 684 (1 085 281) (56 701)
Acquisition - 10 554 9 418 3 078 2 120 2 144 404 2 169 574
Disposal (cost) -23 (21 052) (1 642) (3 806) (1 039) (1 377) (28 939)
Disposal (accumulated depreciation) - 9 546 1 344 3 389 1 039 - 15 318
Depreciation - (320 352) (377 063) (11 856) (28 868) -27 (738 166)
Impairment loss (-) - (10 685) -195 21 2 -506 (11 363)
Other (cost) 2 (22 217) (52 627) (2 542) (3 921) 1 851 (79 454)
Other (accumulated depreciation) - 28 124 49 360 1 766 2 670 - 81 920
Balance as at 31 December 2013
Cost at end of period 49 520 8 906 244 6 339 315 177 861 501 099 2 098 491 18 072 530
Accumulated depreciation - (3 263 734) (2 567 976) (76 599) (322 926) -590 (6 231 825)
Impairment loss -103 (21 837) - -2 -14 (7 183) (29 139)
Net carrying amount at end of the period 49 417 5 620 673 3 771 339 101 260 178 159 2 090 718 11 811 566
property_plant_equipment_b_enea_2014.xlsx

Collaterals established on the Group's property, plant and equipment are disclosed in Note 18.

Due to a delay in construction of block 11 in Kozienice Power Plant as compared to planned works for 2014, the settlement of the whole construction phase has been made in January 2015 in the total net amount of PLN 280,796 thousand. The Group does not have an information of the individual works that have been completed by 31 December 2014, therefore the whole construction phase was formally approved and invoiced in January 2015 and recognized in the accounts, both in capital expenditures and liabilities, at the time of invoicing by the contractor, i.e. in January 2015.

Impairment test (property, plant and equipment)

As at 30 September 2014, due to the falling prices of electricity and certificates of energy origin, the Group carried out tests for impairment of tangible fixed assets in entities producing energy. As a result of the analysis the Group recognized an impairment loss on assets (biogas plants in Liszków and Gorzesław), in the amount of PLN (28,658) thousand.

The key assumptions applied to test are as follow:

  • energy price trends for years 2013-2035,
  • price trends of certificates of energy origin from renewable resources and cogeneration,
  • price trends of CO2 emission rights,
  • price trends of coal,
  • allocation of free of charge CO2 emission rights for years 2015-2020 according to the derogation proposal (Art. 10 paragraph 5 of the Directive 2003/87/WE of the European Parliament and the Council),
  • consideration of the new power unit no. 11 in Kozienice power plant,
  • consideration of support system for green energy for the whole projection period but not longer than 2029. 

 PEC ObornikiMEC Piła Wind farm DarżynoBiogas plant DobittWind farm WindfarmHeat and power plant BiałystokHydro-electric power plantPower plant Kozienice 
Recognition of financial projections Real Real Real Real Real Real Nominal Nominal
Discount rates pre-tax 6.70% 7.10% 8.10% 6.30% 7.80% 7.30% 5.60% 6.50%
Residual discount rates 0.00% 0.00% 0.00% 0.00% 0.00% 0.00% 0.00% 2.50%
property_plant_equipment_c_enea_2014.xlsx
 

Projection periods applied for particular cash generating units:

  • Power plant Kozienice – till 2035,
  • Heat and power plant Białystok – till 2018,
  • Biogas plant Dobitt and wind farm Windfarm – till 2034,
  • Hydroelectric power plants – till 2034,
  • Wind farm Darżyno – till  2034,
  • MEC Piła – till 2018,
  • PEC Oborniki – till 2018.

Adoption of longer than five years financial projections period is justified by the fact, that assets used by cash generating units have longer economic useful life.

Based on the sensitivity analysis performed, prices of energy, certificates of origin, CO2 emission rights and discount rates are the key factors having an impact on the estimated value in use of cash generating units.

Finance lease

The Group uses the following property, plant and equipment under finance lease:

31.12.201431.12.2013
Initial valueAccumulated depreciationNet carrying amountInitial valueAccumulated depreciationNet carrying amount
Technical equipment and machines 1 937 -783 1 154 1 029 -308 721
Vehicles 8 098 (3 390) 4 708 10 096 (3 755) 6 341
Other fixed assets - - - 1 656 -346 1 310
Total 10 035 (4 173) 5 862 12 781 (4 409) 8 372
finance_lease_enea_2014.xlsx

The Group does not enter into finance lease agreements as a financing party.